I want to stop drowning

BabyStepper

debtaghh wrote: »

I can't say what my shortfall is as every month we have different income coming in. Without any extra money then the shortfall is approx £400 not including saving for anything. But my dh does get overtime most months.

Approximate will not do. You need to know exactly what the shortfall is with you and your dh's basic wages, and with all your essential payments (not savings), all of the bills that keep the roof over your heads, food on the table and credit cards happy. You need to know this, it is urgent that you know this, otherwise you are guessing and that never ends well.

debtaghh

BabyStepper wrote: »

Approximate will not do. You need to know exactly what the shortfall is with you and your dh's basic wages, and with all your essential payments (not savings), all of the bills that keep the roof over your heads, food on the table and credit cards happy. You need to know this, it is urgent that you know this, otherwise you are guessing and that never ends well.

I do know the exact figures but my dd is currently using my laptop which is why I said approx £400 as I know it's around that amount but I do have the exact figure logged.

debtaghh

BabyStepper wrote: »

Your savings are not savings, it is money you withdrew from a credit card. This is not the same thing, you have not been able to save up several thousand pounds, you borrowed it. Telling yourself you managed to do something you did not is unhelpful in getting a realistic look at your position.

The only way your credit cards will reduce is if you stop using them. If you overpay when you can't afford to, you will need to use them again. It is really that simple. The available credit on your cards is not yours to use. They will only go down if once you have paid them, they remain paid!

As a rule, £1,000 emergency fund is recommended for houseowners and £500 for renters. You will need a savings pot for when your monthly income is lower than your essential outgoings. I would get this one going as a priority. After that, a savings pot for Christmas, car repairs, all the things that are not in your monthly budget. THEN start with the debt overpayments.

Most importantly you need a way to chart your progress so that you know if you are making any. It will be very slow and like you said, in 6 months you are going to re-evaluate and consider a dmp if you are getting nowhere with it all. 6 months is not long in the world of mse so every penny will count.

I know you have been given all of this advice before, no harm in repeating it.

I completely appreciate that it's not savings that I have made myself and I won't be using the credit cards this year. The aim is to pay them off and then close them.

With regards to saving / debt clearing I find this a tricky one as I really want to reduce the minimums.

Do you think I should save £500 for emergencies? What does this over?

Should I start saving for Xmas,car, dentist as well? If so how much? My dh needs a lot of dental work , we both get a Pre payment medical cards.

enthusiasticsaver

You need to save enough from overtime and extra income so you are not forced to put things on credit cards whic( as babystepper says is making your situation worse. One day these 0% deals will dry up or minimums will be increased making your precarious situation even worse. I know you are determined to keep on though so I would set your direct debits for slightly more than minimums on all but the card you are targeting. Set that at a level you can afford even on a low income month.

You need to save for everything you would otherwise be tempted to put on a credit card, dental treatment, car maintenance, holidays, Xmas. If you find you have spare money in your savings account then put it against a credit card. Only you know if what you are doing is working as you have taken the debt totals off your signature. You said a short while ago you did not think you have had your LBM. I am glad to say your rent is fixed so you have 18 months to get a strategy sorted in case you have to move again or the rent is unaffordable. You have booked a holiday so that means saving for it. Are you job hunting for another job or looking to take on a second job to increase income?

debtaghh

I have been looking at both options a second job or another job with more hours and more money. I have to think about the child care costs as well.

I had a panic last year and money transferred a lump sum to cover holiday, bdays etc. I know this is wrong and a cycle I need to get out of as all it means is my debt increasing. This is a struggle that I really have

enthusiasticsaver

Here is a useful exercise my DH and I do every year to plan finances. We decide on holidays, small or big. This year I am worried about Brexit so we are aiming for just UK ones so I research how much they will cost and set a target to save it by the time it needs paying. The problem with this is that they normally have to be paid two months before you go so if you go in August (unwise as that is the most expensive) you will need to pay in June so you have 6 months to save. You then need spending money. You know how much it is as you have already booked it. You could save as much as possible for the holiday and ignore Xmas savings until later in the year after the holiday balance has been paid. Get a quote from the dentist and ask for payment plans so you know what you are dealing with. Whatever you spent on the car last year by way of maintenance save that and add a percentage as the car is older. You should be saving for a replacement too but one step at a time. You know when all these things are going to happen and what you paid last time so you know what amount you need to keep in reserve. We can't tell you as we don't know where you have booked to go on holiday or when, how much you normally spend on Xmas or how expensive the dental treatment is. Everything you put on a credit card add up and aim for that in reserve if you don't intend changing anything.

Is the debt increasing or decreasing? Have you got the figures for last January and now? Even if you won't publish them on here you need to acknowledge them to yourself.

enthusiasticsaver

If the debt is increasing you are in a debt spiral. I think you have come to rely on credit so much. I am amazed they still keep approving them.

debtaghh

The debt has increased compared to last year but I have a lump sum in the savings which I could technically use to pay it off meaning my debt would have gone down last year. They don't keep on approving as in we don't apply for new credit cards. We were using the ones we have.

I've worked out before that we will need to save £400 a month towards, car maintenance, dentists, health card, holiday, bday and Xmas etc.

You mention Brexit, I worry about the cost of things increasing especially when there is uncertainty. Is this what you mean?

WannabeFree

Just jumping back out again about the credit check and renting.

It isn't a credit check like when you apply for credit. The rental agency can only see public infomation. They will have no idea what credit accounts you have. The amount outstanding. Nor if they are up to date or behind.

The only think they can see are CCJ's and CIFAS markers. It's more to prove you are who you are, you have got CCJ's and you haven't got a fraud marker.

I was behind on several payday loans and credit cards etc when I was credit checked for my current rental and was worried about losing the house. If you search on the forums you will find it repeated several times by those who know alot more than me too.

I obviously can't help about DH's job but from the rental side of things a DMP doesn't show on the 'credit check' an estate agent does.

It is a big step admitting the problem is bigger than you can juggle, I think alot of your friends on here are worried that the slightest thing will tip you over the edge. If for instance your husband has an accident/becomes unwell or anything else that will mean he needs time of work what will you do? or what when the lines of credit you have become unavailable etc? I think a lot of replies come across like people are judging you but I think it's more out of concern after seeing it/being in the situation themselves.

I haven't really replied as I'm worried it comes across wrong but I do worry and read along in the back ground
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debtaghh

WannabeFree wrote: »

Just jumping back out again about the credit check and renting.

It isn't a credit check like when you apply for credit. The rental agency can only see public infomation. They will have no idea what credit accounts you have. The amount outstanding. Nor if they are up to date or behind.

The only think they can see are CCJ's and CIFAS markers. It's more to prove you are who you are, you have got CCJ's and you haven't got a fraud marker.

I was behind on several payday loans and credit cards etc when I was credit checked for my current rental and was worried about losing the house. If you search on the forums you will find it repeated several times by those who know alot more than me too.

I obviously can't help about DH's job but from the rental side of things a DMP doesn't show on the 'credit check' an estate agent does.

It is a big step admitting the problem is bigger than you can juggle, I think alot of your friends on here are worried that the slightest thing will tip you over the edge. If for instance your husband has an accident/becomes unwell or anything else that will mean he needs time of work what will you do? or what when the lines of credit you have become unavailable etc? I think a lot of replies come across like people are judging you but I think it's more out of concern after seeing it/being in the situation themselves.

I haven't really replied as I'm worried it comes across wrong but I do worry and read along in the back ground
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Thanks so much for your reply. I know what you mean as sometimes some messages do feel negative but I understand that people mean well.

I know we are in a complete mess and I change my mind daily with regards to what the best option is.