Young people in debt

lyrh2017

Hi all,

Me and my other half are 21 and 22, however together we have £14'000 of debt over our heads between us.

We currently rent privately, and these are our bills:

Rent: £560
Bills (elec & gas, water, sewage, broadband, insurance, council tax, tv license): £245

His regular finances:
Rent (inc bills and food shopping) £500.00
Loan £176
Car Insurance £85
Car Lease/ Finance £171
Mobile £45
Apple/iCloud £10
Petrol £80
Total Outgoings: £1067

His debts:
HMRC £474.70
Burtons £250.00
Next £450.00
Lloyds Credit Card 300.00
Loan 4,583.18
Overdraft 250.00
Total: £6,308.50

My regular finances:
Rent (inc bills and food shopping) £500.00
Loan £170.44
Car Insurance £81.52
Car Finance £229.00
Mobile £44.79
Contacts £20.50
Petrol £60.00
Apple Music £10.00
Credit Cards £90.00

My debts:
Credit Card1: £671.81
Credit Card2: £2,315.00
Credit Card3: £904.00
Overdraft £1,300.00
Loan £2,100.00
Total: £7,290.81

I bring home £1281/month after tax.
He brings home £1500/month after tax.


We want to get this cleared up and sorted as soon as possible - and were thinking of trying to get a consolidation loan.
At the moment we are paying out £475(+/-) combined for debts.

What would other debt busters suggest doing? Ideally we are wanting to reduce the monthly amount we spend on debts.

Thanks!

gettingtheresometime

Don't get a consolidation loan.....you'll fall into the belief that you've got money to spare & wont curb your spending which is probably the reason you are where you are.

The rule if thumb is to throw any spare cash at the debt with the highest Apr and once that's paid off, throw that debts money towards the next highest.

The car insurance seems - is that because of your ages?

lyrh2017

Yeah of our ages, hopefully should go down by November.

After everything is paid, we should have £432 a month left. But we never see that actually money.

sourcrates

From painfull experience, the senario goes something like this for most people.

Get job, get debt, get more debt.

Try zero % deals, works until deals run out.

Get consolidation loan, works till you start spending on credit again.

Realise your debts have doubled, and you can't service them.

More cards, more loans, more consolidation ........ stop !!!!

Stop using credit, work out a budget you can live on, the remainder of your pay should go towards the debt.
Debt management plans are popular, get some proper advice from one of the free debt charities.

Borrowing your way out of debt rarely works.

lyrh2017

After everything is paid, we should have £432 a month left. But we never see that actually money.

lee111s

Start a spending diary and see where it goes.

Count every penny.

Can you drop down to one car? That would free up £350 a month.

lyrh2017

We've worked it out that we spent about £170 this month on little purchases as tesco this month....we've dicussed one car, however we work in different directions and also work different timings...

ceb1995

Are you both stuck in mobile contracts for a while? Have you ensured all your bills are as cheap as possible?
Am I correct with my maths in that your food bill is £200 a month for two of you, you could make cuts there?

zippygeorgeandben

I'm confused - am I seeing 3 lots of rent? Whats the £560 at the top of the post 1? Then 2 lots of £500?

lyrh2017

No sorry, that's my mistake. We both pay £500 each. This is rent, bills and food shopping.

lyrh2017

Yes £200 for two of us for the month.
We shop at Aldi and spend around £50/55 a week on breakfasts, lunch and dinners, and always use everything we buy. What else could we do to bring it down??