I'm in so much debt and so, so ashamed :-(

ElleWoods

After paying off my debts a few years back I've got myself into such a mess again. I don't know where to turn and feel so stupid and ashamed. I can't admit this to anyone, I tell people I'm doing ok financially but it won't be long before I'm unable to meet my repayments. I can't believe I've let myself get into such a mess again, I've made so many financial mistakes that I don't know how to fix them or where to turn. I'd love some advice but please be kind as I'm at the end of my tether.

At the end of last year I left my part time job to go self employed. The reasons why I left are numerous and complex - mental health issues made much worse by the stress of the job (I was ready to crash my car into a wall so I didn't have to go), lack of childcare (I'm a single parent and other parent isn't involved) and needing to be around for ailing elderly parents with health issues inc Alzheimer's. Before leaving I looked into my finances and although I had debt, I thought I'd be able to manage. I was wrong. I'm not earning as much as I thought I would (copywriting), so I'm looking for a local part time job so I can still be around for my caring responsibilities but haven't found anything as yet. In the meantime I'm trying to earn what I can by doing surveys, mystery shopping etc, when I don't have any work in. Although I'm now receiving more in benefits, they only cover the essentials. I have over £11k of debt on a car loan, personal loan and credit card and my expenditure is almost £400 more than my monthly income. I've also gone about £500 into my overdraft limit of £750 for the last couple of months. I'm in the black right now but once my rent and bills come out next week I'll be vastly overdrawn again. I've spent much of today looking into my finances and my SOA is below. Do you think it's worth me calling StepChange? No idea what they can do though. I've got myself into this mess and I need to get myself out of it somehow. Thank you for reading.

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 1
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 200
Partners monthly income after tax....... 0
Benefits................................ 822
Other income............................ 199
Total monthly income.................... 1221

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 500
Management charge (leasehold property).. 0
Council tax............................. 18.16
Electricity............................. 40
Gas..................................... 40
Oil..................................... 0
Water rates............................. 34.40
Telephone (land line)................... 17.40
Mobile phone............................ 20
TV Licence.............................. 12.12
Satellite/Cable TV...................... 36
Internet Services....................... 0
Groceries etc. ......................... 220
Clothing................................ 26.67
Petrol/diesel........................... 20
Road tax................................ 18.75
Car Insurance........................... 29.42
Car maintenance (including MOT)......... 8.33
Car parking............................. 4
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 10.42
Medical (prescriptions, dentist etc).... 35
Pet insurance/vet bills................. 11.67
Buildings insurance..................... 0
Contents insurance...................... 5.42
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 27.50
Haircuts................................ 12.5
Entertainment........................... 45
Holiday................................. 0
Emergency fund.......................... 0
(Unnamed monthly expense)............... 0
Education............................... 19.99
Sport/Hobbies........................... 54.13
Savings................................. 25
Total monthly expenses.................. 1291.88


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 5000
Other assets............................ 0
Total Assets............................ 5000

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Car Loan.......................3503......122.......4.5
Personal Loan..................5238......131.......4.7
Credit Card....................2293......75........0
Total unsecured debts..........11034.....328.......-


Monthly Budget Summary
Total monthly income.................... 1,221
Expenses (including HP & secured debts). 1,291.88
Available for debt repayments........... -70.88
Monthly UNsecured debt repayments....... 328
Amount short for making debt repayments. -398.88

Personal Balance Sheet Summary
Total assets (things you own)........... 5,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -11,034
Net Assets.............................. -6,034

anna_1977

SoftKittyWarmKitty wrote: »

After paying off my debts a few years back I've got myself into such a mess again. I don't know where to turn and feel so stupid and ashamed. I can't admit this to anyone, I tell people I'm doing ok financially but it won't be long before I'm unable to meet my repayments. I can't believe I've let myself get into such a mess again, I've made so many financial mistakes that I don't know how to fix them or where to turn. I'd love some advice but please be kind as I'm at the end of my tether.

At the end of last year I left my part time job to go self employed. The reasons why I left are numerous and complex - mental health issues made much worse by the stress of the job (I was ready to crash my car into a wall so I didn't have to go), lack of childcare (I'm a single parent and other parent isn't involved) and needing to be around for ailing elderly parents with health issues inc Alzheimer's. Before leaving I looked into my finances and although I had debt, I thought I'd be able to manage. I was wrong. I'm not earning as much as I thought I would (copywriting), so I'm looking for a local part time job so I can still be around for my caring responsibilities but haven't found anything as yet. In the meantime I'm trying to earn what I can by doing surveys, mystery shopping etc, when I don't have any work in. Although I'm now receiving more in benefits, they only cover the essentials. I have over £11k of debt on a car loan, personal loan and credit card and my expenditure is almost £400 more than my monthly income. I've also gone about £500 into my overdraft limit of £750 for the last couple of months. I'm in the black right now but once my rent and bills come out next week I'll be vastly overdrawn again. I've spent much of today looking into my finances and my SOA is below. Do you think it's worth me calling StepChange? No idea what they can do though. I've got myself into this mess and I need to get myself out of it somehow. Thank you for reading.

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 1
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 200 - I know you said you're looking for a p/t job but this needs to increase
Partners monthly income after tax....... 0
Benefits................................ 822
Other income............................ 199 what is this?
Total monthly income.................... 1221

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 500
Management charge (leasehold property).. 0
Council tax............................. 18.16
Electricity............................. 40
Gas..................................... 40
Oil..................................... 0
Water rates............................. 34.40
Telephone (land line)................... 17.40
Mobile phone............................ 20
TV Licence.............................. 12.12
Satellite/Cable TV...................... 36this really does need to go
Internet Services....................... 0
Groceries etc. ......................... 220
Clothing................................ 26.67
Petrol/diesel........................... 20
Road tax................................ 18.75
Car Insurance........................... 29.42
Car maintenance (including MOT)......... 8.33
Car parking............................. 4
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 10.42
Medical (prescriptions, dentist etc).... 35what is this for? you are entitled to an NHS redemption aren't you?
Pet insurance/vet bills................. 11.67
Buildings insurance..................... 0
Contents insurance...................... 5.42
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 27.50
Haircuts................................ 12.5 every month?
Entertainment........................... 45needs to go
Holiday................................. 0
Emergency fund.......................... 0
(Unnamed monthly expense)............... 0
Education............................... 19.99what is this?
Sport/Hobbies........................... 54.13huge amount to be spending when looking at your deficit
Savings................................. 25
Total monthly expenses.................. 1291.88


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 5000
Other assets............................ 0
Total Assets............................ 5000

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Car Loan.......................3503......122.......4.5
Personal Loan..................5238......131.......4.7
Credit Card....................2293......75........0
Total unsecured debts..........11034.....328.......-


Monthly Budget Summary
Total monthly income.................... 1,221
Expenses (including HP & secured debts). 1,291.88
Available for debt repayments........... -70.88
Monthly UNsecured debt repayments....... 328
Amount short for making debt repayments. -398.88

Personal Balance Sheet Summary
Total assets (things you own)........... 5,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -11,034
Net Assets.............................. -6,034

Hi
Well done on posting! My comments are in red above. Are you with Sky TV? If so phone up and say you need to cancel due to financial difficulties, in my experience they are very good and if in contract they may reduce if you can't cancel

How far into car finance are you ? If over half way hand the car back.

Entertainment and Sports stick out as HUGE monthly expenses that you just can't afford.

How old is your child/children?

Good luck

missbiggles1

You have pet insurance/vet fees but no money allocated for feeding it.

lessonlearned

Hi kitty.

Well done for posting, try not to panic, there always a way out.

Just off the top of my head I think you can cut £217-80 per month off your budget, but it would mean a moratorium on all discretionary spending for the time being and I don't know if you would find it palatable

.you would need to ditch the following ........


£54-13 sports
£27-50 gifts
£12-50 hair
£45-00 entertainment
£36-00 cable
£26-67 clothes
£70-00 reducing food spend down to (£150)

This gives you £271-80

Yes it's drastic and probably not sustainable in the long term but if you could manage to curtail all extra spending for just three months it would help you get out of the overdraft.

What is the £35 on medicines etc. Could you get a prepayment certificate, would that save you money.

£5k in assets.......can these be sold.

The car- it doesn't look like you can really afford a car at the moment. Could you manage without for a while.

The interest rates on your loans don't seem too bad. However what about your overdraft. Are you racking up fees and interest.

Have you get anything to sell.

For free/cheap entertainment, gifts, etc look at "making and doing", vouchers etc.

Chin up, you'll get there.

HappyMJ

Sell the £5,000 car buy another one worth £1,000 and take out a DRO.

All your debt will be written off and you can start again.

luhrmann

granted i'm only feeding myself but i can do that on a generous £120 per month. i can't imagine a child would add an extra £100? i think there's a way you can cut down on that. look into couponing and other ways you can save on groceries.

also seconding the comments about the car - if you can get rid of it, get rid of it. that will be a big expense gone.

have you considered speaking with stepchange or another debt charity? the way you are right now, you can't afford to continue.

well done on posting. you are a single parent also caring for relatives, so don't be ashamed that financially you're struggling! a lot of people do. and know that they appreciate your sacrifice.

asparagus1968

you should be getting free prescriptions on that income look into that asap!

National_Debtline

Hi SoftKitty


Thanks for posting, and please try not to dwell on how or why the situation has come about - what's more important is where you go from here.


Just one thing I wanted to clarify having looked at your SOA - what exactly is meant by "car loan"? Is this a hire purchase-type arrangement i.e. you will only own the vehicle outright once you make the final payment, and you have rights to terminate the agreement early? Or is it simply a cash loan from the bank used to purchase the vehicle, in which case you own it outright already?


Dennis
@natdebtline

enthusiasticsaver

You could reduce the groceries. My OH and I (2 adults) manage on £175 per month for food and household most months shopping in Lidl mainly. All the discretionary spending - cable tv, sports, hobbies, entertainment etc should go while you are in these difficulties until you manage to increase your income. You have £25 in savings column but no savings balance. Personally I also think getting rid of the car would help. If you are having to assist your ailing parents can you claim carers allowance?

Vikipollard

SoftKittyWarmKitty wrote: »

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 1
Number of cars owned.................... 1


Satellite/Cable TV...................... 36 Not sustainable
Internet Services....................... 0
Groceries etc. ......................... 220 Cut to 150
Clothing................................ 26.67 Charity shop for now
Petrol/diesel........................... 20 Piddly amount - don't need a car!
Road tax................................ 18.75 }these four cost
Car Insurance........................... 29.42 }THREE TIMES what
Car maintenance (including MOT)......... 8.33 }you use in fuel
Car parking............................. 4 }

Presents (birthday, christmas etc)...... 27.50 }make things
Haircuts................................ 12.5 }student nights at college or alternate months
Entertainment........................... 45 } cant afford this

Education............................... 19.99 } cant afford this right now
Sport/Hobbies........................... 54.13 }HUGE! Needs to go
Savings................................. 25 Not shown in assets



Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 5000
Other assets............................ 0
Total Assets............................ 5000

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Car Loan.......................3503......122.......4.5


Getting rid of the car alone would save you £202 per month (assuming you can clear the loan with the proceeds from the sale of the car). With such small usage, surely public transport is workable? The other savings could gain another £200.

tlc678910

Hi SK,
As you mention caring pressures for your parents with health conditions in your post I wondered if there is any mileage in considering living with your parents? Do they live in your old family home and have spare rooms / live close by?

This could ease your financial pressures and caring pressures/guilt as you are there for them. It could even ease your child care pressures if, for example, you felt one of your parents would be able to mind your child safely while you worked an evening or night for example (so the childcare is relatively peaceful).

I know this suggestion might not be practical depending on your relationship/the property or distance but if it were possible it could be worth talking with your parents. I think both grandparents and children usually get a lot out of their relationship with each other.
Good luck with everything
Tlc