Head out of sand but it all seems a bit scary

kezzb

Hi, I have finally pulled my head out of the sand and realised I need to sort out finances before I cant afford to pay everyday bills. I have managed to get 20k in debt over the last 5 years by spending more than I'm earning. Im a single parent, my husband died 5 years ago and we had no life insurance, we were idiots I know but you really don't think its going to happen to you. Its been a struggle ever since financially and I guess I just wanted life to be as normal as possible for our son who was 8 when his dad died
Anyway, I know to give us the best future possible I have to get debt free. Ive contacted Step change who have suggested a DMP. It all seems a bit scary but the alternatives seem worse. No questions yet , I just wanted to put my head round the door on this forum with the hope it will all seem a lot less scary
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Karonher

It seems like you have made the hard decision and got in touch with Stepchange.

Most people will suggest posting a statement of affairs and if there are any areas where you could cut back, they will be pointed out.

Sorry but I don't know where the link is.

sourcrates

Hi Kezzb,

The first steps can be scary, but with experiance and time, you will find a DMP won't impact your life much at all.
In fact the positives start nearly straight away, ideally you should cease paying all your non essential debts, like loans, cards, catalogues etc, save up for a few months, get yourself a little emergency fund under your belt.

Then start your DMP, make sure you budget correctly, and for the first time in ages, you will be living within your means !!!

Most DMP's tick over nicely with little creditor interest, as long as you stick to what's agreed, all will be fine, any problems, and stepchange will help you sort them.

Well done for taking the first step, good look with it, feel free to ask any daft questions you like lol !!!!

kezzb

Am I right in thinking I need to start getting my income paid into a new account and set up all my direct debits to go from there?

I am due to take my son away for a week at the beginning of August, we have been given use of my friends holiday home for free, should I leave everything until after our break. We will be doing it very frugally, lots of picnics on the beach

[Deleted User]

Karonher wrote: »

Sorry but I don't know where the link is.

Here you go.

http://www.stoozing.com/calculator/soa.php

Smodlet

Hi, kezzb, and welcome to the forum. I'll be honest, I have no practical advice to offer but the fact that sourcrates is here, and karonher, is enough for me to know you are in good hands. I wish you the best of luck and just wanted to say, you hang in there! You can do this. There is a wealth of support and advice on here.

Thank you again, sourcrates, for all your good advice and to you, karonher, for your good sense... even when we disagree.

Edited to add: And Bedsit Bob

sourcrates

kezzb wrote: »

Am I right in thinking I need to start getting my income paid into a new account and set up all my direct debits to go from there?

I am due to take my son away for a week at the beginning of August, we have been given use of my friends holiday home for free, should I leave everything until after our break. We will be doing it very frugally, lots of picnics on the beach

Yes to all, sounds like a plan !!!

kezzb

Thank you all for being so kind and not judging me. Ive been in touch with Step change who said I should stop paying credit cards now, just pay a pound., while the DMP is being set up. Do I need to cancel the direct debits? Also, I need to set up a new bank account. Any recommendations please, not Barclays as they are one of my creditors.

When you say getting some savings behind me, do I just save the money that would have gone on cards and pay in anything I make extra?
Sorry, my mind is whirling now, there is a lot to sort out.

Would it be awful of me to let my overdraft cover direct debits while I transitioning from 1 account to the other?

Save

sourcrates

Yes cancel DD's, Lloyds do a good basic account, can all be done online, really quickly.
Don't be tempted to use credit to cover payments as that can be construed as preferencial treatment, don't worry about it, stopping payments is par for the course.

kezzb

So I shouldn't use the overdraft to cover any payments (not to creditors) during transition? I put an invoice in weekly and its paid straight away and my tax credits payment has just gone in to old account so will be a month before it goes in to new account. Just looking at logistics.

sourcrates

Oh not to creditors, oh well that's up to you really !!