Personal debts to friends and family

SophieLoui23

shroomdoom wrote: »

He wants me to repay 400 per month

In which case, you have a shortfall of €82 each month.

If it was me, I would cut the emergency fund to €50 each month whilst I was paying him off. I'd also try and lower my grocery budget to €250. This site can help with meal planning and budgeting for food. This means that you could keep your entertainment budget whilst paying him the amount he requested. And he'll be out of your hair in 5 months

You could consider cutting your clothing budget but to be honest, it's fairly low at the moment anyway.

shroomdoom

You're smarter than I am! Great ideas. My clothing budget should end up as less; but I thought it better just in case, due to my recent luck, a bird decides to crap on me and the stain won't come out

SophieLoui23

shroomdoom wrote: »

You're smarter than I am! Great ideas. My clothing budget should end up as less; but I thought it better just in case, due to my recent luck, a bird decides to crap on me and the stain won't come out

:rotfl: Sounds like your luck is on par with mine at the moment!

If it helps, start a diary on here. I've found everyone to be really friendly and supportive, plus I love seeing my debt totals decrease.

Good luck, you can do it. Hopefully having a plan of action will help. Just remember, if you stick to it, you won't have to deal with him by the time Spring is here! :beer:

shroomdoom

Thanks so much

MrsSave

Sounds like a good friend :eek:

You mention that this shows half of the bills. You pay half and your mother the other half. Does that mean you spend 300€ on groceries for just yourself? Sorry if you've explained this and I've missed it, but I feel that's the case then that can be cut back a good 100€.

As others have suggested I would cut back the emergency fund to 50 per month, to free up a little more. I would also cut back on gifts and clothing, especially as it's only a few months and then in 5 months time you'll free up the money you're paying this 'friend'.

Pixie5740

This person was good enough to lend you 2,000 euros when you needed it. I'm not saying their behaviour is right (contacting your friends, family and place of work) but I do wonder what has driven them to such behaviour. Do they need the money back and whilst you are pleading poverty they see you out buying new clothes, getting taxis? Where did the communication break down? I also wonder what posters would be advising someone who loaned a friend 2,000 euros and hadn't seen a bean back even though the friend was working again.

Having seen your SOA I also think the 300 on food could be reduced. Is the 50 for clothes and 50 for presents really necessary whilst you owe friends money? You are setting aside 100 a month for emergencies so if you find yourself needing new clothes (bird poo washes out and apparently it's lucky if a bird poos on you) you can use that to fund the purchase. As for presents, don't buy any until you've paid back your friends.

tlc678910

When you are employed again would it be possible to borrow the money to pay your friend/s at high street rates? Or was your credit damaged when you were unemployed?

Tlc

enthusiasticsaver

I would prioritise paying your friend back and there is plenty of leeway in your budget to reduce. £2000 is a lot of money and I can understand why he wants it back asap and will stop the hassle you are having too. As much as you regret borrowing it I am guessing he regrets lending it even more.

According to your soa you only have a 82 shortfall. The areas you could cut back on or get rid of altogether on a temporary basis are entertainment, clothing, groceries, emergency fund.

I know you have said your entertainment is for your grandmother and taxis etc but why do you not go over to her on public transport and take a nice cake instead of taking her out until this debt is paid off? That would not cost £150 per month and you can use public transport which must be cheaper.

2000 is a lot of money and I am guessing that as much as you regret borrowing it I am sure your friend regrets lending it even more. You should be moving heaven and earth to repay it considering how long ago it was lent. Just focus on paying off the debt for the next 5 months and then you will be debt free. At least there is no interest to pay.

lessonlearned

Hi Shroom Doom

First of all congrats on the new job. Hope it's the start Of better things for you.

Pixie....has a point - you need to look at this from your friends point of view.

I feel that all debts to friends are "debts of honour". Paying them back is a matter of priority. You MUST pay them back as a matter of urgency. It's not like a bank or commercial institution who make money on debt, it's part of their business. Your friends do not receive interest or recompense.

You have two choices.....

Throw EVERYTHING At the debts or refinance or Take out a bank loan. assuming your credit history is good enough and they will lend to you. Yes you will pay interest but rates are historically low and you should get a good deal.

1. Throwing everything at the debts....this would mean an absolute moratorium on all non essential spending. I can find E400 in your budget.

Reduce food to E200 .....saving E100
No entertainment - E150
No clothing ... E50
No emergency fund. E100

Yes it's brutal but in 7 months you will have raised E2800 and will have fulfilled your obligations to your friends.

2. Borrowing from a bank or similar, paying back over say 2 or even 3 years would be more comfortable but will obviously cost a bit more in the long run.

In all conscience you cannot expect your friends to wait whilst you simply chip away at the debts making small payments and continue spending on clothes, taxis and salting money away in your emergency fund.

Yes it's nice to buy gifts for Christmas etc but you can make these just fun "token gestures" with money from your food budget. something like a chocolate orange or a giant sized toblerone can be picked up for around E1 and would be just as much appreciated by the recipient.

And......whilst it's nice to spend time with your grandmother I'm sure she would be horrified if she realised how much you were spending on her when you are in so much debt. You need to be creative. They are loads of ways you can spend quality time with her without spending much.

Instead of taking her out in a taxi for tea....then take the tea to her.......buy or make her some nice posh cake and then make her a fancy "hotel style afternoon tea". Dig out her best China, make fancy sandwiches and posh cake. Make it a game. Then when the weather is nice take it outside and make it a picnic. If the weather is bad take a DVD - old style Hollywood musical or romance - borrow from the library.

Play cards with her, or look through photos, maybe do a few little odd jobs with her.

Seriously it's your time and your company she wants, not your money.

Re her prescriptions. Does her surgery deliver, they should do if she is housebound.

You can do this - all it takes is a bit of imagination and creative thinking.

Good luck.

EssexHebridean

shroomdoom wrote: »

Thanks for the link, that's really helpful!

He essentially said if I don't pay the agreed amount, he will destroy my life and use the promissory note in court. To be honest, I understand how he feels and I just wish I could rectify this straight away.

My offer is going to be half of what he's requested per month, starting two weeks later than he requested...I'm afraid to even contact him about the offer because I'm afraid it will trigger more humiliation.

Has he said this in writing anywhere? By text perhaps, or email?

Next time someone makes a "joke" about you not wanting to pay, I suggest looking them straight in the eye and saying very seriously that you've made very clear to this friend that you are DESPERATE to pay him back, however he's been aware of the situation throughout that your finances have been too limited to allow you to do this. Personally I would then go on to say how distressed his threats to destroy your life have left you, that you are disappointed in their unethical behaviour in relation to contacting all and sundry about this. Chances are that they may not have been entirely open with others about their side of things - and I'm really not a fan of those who attempt to make themselves appear whiter-that-white while behaving badly.

You MUST now prioritise this debt - for the time being personally I would cut your entertainment budget to practically zero - you need to gently explain to your Grandmother that money is very tight at the moment and so you're unable to take her out. Can your Mother not take a share in the expenses relating to collecting her prescriptions etc? can you find out from her local chemist whether they have a service in place for delivering prescriptions to those unable to get out? Some do. That deals with your E82 shortfall. Food/groceries can be cut dramatically - even if this is for two people it can still reduce. Emergency fund - your SOA shows you budgeting E100 a month for this but you are showing no cash assets? Where is this money going? Your present budget - cut in half (and again - no trace of where this money is currently going?) and clothing > Zero for the time being. Personally I'd shift the 39.9% Littlewoods debt as a priority whilst maintaining the E400 you're paying to friend 1. With the savings on the SOA you should be in a position in 2 months time to be able to throw an extra E200 plus to Friend 1. That clears that debt in 4 months from now - If it were me I'd add an extra sum onto the final payment, to be sent to said "Friend" in writing to the effect that the sum paid is in full and final settlement of the debt and includes the interest that you acknowledge they have a right to expect. Work out an approximation of the interest their E2k would have earned them had they had it in a medium interest savings account for this period of time and make your additional sum fractionally above this. Pay by cheque.

You have to bite the bullet now and deal with this - you have already had a taste of what this person is like - and I suspect have firmly learned your lesson about borrowing from friends also. Knuckle down, tighten your belt, make sacrifices for a very short time and you will be debt free by March.