Day 1

wheely

Good afternoon,

I have to admit to myself that I am in trouble. I cannot talk to family or friends, as I am just to embarrassed. I have not been able to talk to my wife about it, as it will cause unbearable pressure on our relationship.

I have approximately £36k of debt, accumulated over a decade of keeping my head above water and living beyond my means.

The debt is spread over 5 credit cards, with varying rates of interest, and no hope of transferring to lower interest/0% cards.

I have an outstanding mortgage of £100k on a £170k house, and I cannot afford to lose the house.

I am in the fortunate position of having a good job, that is as secure as any job can be nowadays.

My income is around £2600/month, plus a contribution to bills of £450 from my wife. My outgoings are around £2700 before living/fuel costs of around £400.

I am not in arrears and I can meet the minimum payments, (just) but this weighs round my neck every day.

I recognise I need some lifestyle changes and can cut back on non-essentials, and will take Martin's advice and set a day aside to do a Money Makeover.

I just wanted somewhere to turn and someone to talk to.

Thanks

bargainbetty

Hi Wheely, welcome to the boards.

There are plenty of people on here who have stood in those shoes and worked their way out and upwards, and they will be here to offer help and advice along your way. Don't lose hope - this is a big first step, and every journey starts with one of those!

If you would like some specific advice on your budget, don't be afraid to use the statement of affairs (there is a sticky linking you to it) and put up your figures in all their glory - it's nerve-racking and people may be blunt, but they will give you good and useful information on how to reduce your outgoings.

You will have advice to share the problem with your wife. If you have been living beyond your means then cutting back won't be a thing you can do unnoticed. If she understands the situation and can recognise her part in fixing it, then it will be easier for both of you to move forward with a plan.

I wish you every success on your journey.

enjoyyourshoes

Need to discuss with wife.

Then agree life goals and put these is financial terms (sound like being debt free in X years/months may be a starter for ten)

The rigorously investigate research analyse all monthly outgoings , split into needs and wants, then ditch the wants.

reconcile bank account daily, accrue for medium and long term costs and deduct these (as accrual) including all monthly so/dd.

do cash flow with all debts and calculate maximum contribution by month
by debt (based on affordability and when removed all wants from monthly expenditure)

Set up DD to above amount by debt , sit back live frugally till debts paid off.

The start saving the debt repayments in to regular savers

Distiller72

I was in your position bit with 50k+ and i only dealt with it when i lost my job through illness.
My income reduced by arpund 90% so major changes needed to be made. Now I am surprised how much money i actually wasted month in month out.

National_Debtline

Hi wheely


It can be difficult dealing with something like this when you feel like you don't have anyone to confide in. You'll find lots of lovely helpful people on the board. And if you would like more specific advice it's a good idea to complete a statement of affairs (SOA) and post it back on here. It gives a more detailed view of your financial situation and allows others to give some useful advice on the best way to get your debt reduced. You'll find the SOA here
http://www.stoozing.com/calculator/soa.php. Good luck with it all.


Susie
@natdebtline

fatrab

Good luck on your journey.

At one point amongst other debts and commitments I was over £18000 on cards, overdraft maxed out (£3000), outgoings almost as much as income. That was just over 4 years ago.

Currently £5000 left on cards to pay, all at 0%, no overdraft, £1000 emergency fund and a surplus of £800+/month

It just takes time and following good advice.

I only started using the forum properly last month and no matter how bad you think your situation is there's always someone with the right advice. I followed the advice on the main site for most of my journey so far, but really wish I'd known about the amazing additional advice and support available here.

Definitely do an SOA. It really helps

Best wishes

fatbelly

wheely wrote: »

Good afternoon,

I have to admit to myself that I am in trouble. I cannot talk to family or friends, as I am just to embarrassed. I have not been able to talk to my wife about it, as it will cause unbearable pressure on our relationship.

I have approximately £36k of debt, accumulated over a decade of keeping my head above water and living beyond my means.

The debt is spread over 5 credit cards, with varying rates of interest, and no hope of transferring to lower interest/0% cards.

I have an outstanding mortgage of £100k on a £170k house, and I cannot afford to lose the house.

I am in the fortunate position of having a good job, that is as secure as any job can be nowadays.

My income is around £2600/month, plus a contribution to bills of £450 from my wife. My outgoings are around £2700 before living/fuel costs of around £400.

I am not in arrears and I can meet the minimum payments, (just) but this weighs round my neck every day.

I recognise I need some lifestyle changes and can cut back on non-essentials, and will take Martin's advice and set a day aside to do a Money Makeover.

I just wanted somewhere to turn and someone to talk to.

Thanks

Well you're in the right place.

What are the total minimum payments over the 5 cards? I'm estimating around £1000.

If you could get the cards to 0% that would clear them in 3 years. However your credit rating means you cannot do this.

Now may be the time to bite the bullet and go for a dmp with stepchange or payplan, to get the same result and get rid of this non-priority debt.

wheely

Thank you. I will upload a SOA once I've been to work and reviewed my budget spreadsheet.

It's nice to know someone is listening.

CoffeeCakeYarn

Just wanted to say welcome. I'm just starting out too, with £25k and just my (okay-ish) income. It seemed like a huge number, but once I'd got my head around the SOA and got a plan in place I felt so much better. You can do it!

wheely

Not really sure of the best way to format this, but here goes. Do your worst/best.

I know i am not in the worst position possible, but i want to get to a point where i can actually use the salary I earn, instead of using it all to pay off debts.

I know there are some easy wins, such as TV, utility bills etc, and I am trying to find a day off, so as I can sit at home an do a MoneyMakover. Any hints, tips or advice i can put into place during my Makeover would be greatly appreciated.

Thank you.

Statement of Affairs & Personal Balance Sheet
Summary
Monthly Budget Summary Amount(£)
Total monthly income 3,070.6
Monthly expenses (incl. HP & secured loans) 1,815
Available for debt repayments 1,255.6
UNsecured debt repayments 1,045
Amount left after debt repayments 210.6
Personal Balance Sheet Summary Amount(£)
Total Assets (things you own) 193,500
Total Secured & HP Debt -100,000
Total Unsecured Debt -36,869
Net Assets 56,631
Household Information
Number of adults in household 2
Number of children in household 0
Number of cars owned 1
Income, Expense, Debt & Asset Details
Income Amount(£)
Monthly income after tax 2620.6
Partners monthly income 0
Benefits 0
Other income 450
Total monthly income 3070.6
Expenses Amount(£)
Mortgage 650
Secured/HP loan payments 0
Rent 0
Management charge (leasehold property) 0
Council tax 142
Electricity 40
Gas 43
Oil 0
Water Rates 23
Telephone (land line) 0
Mobile phone 35
TV Licence 12
Satellite/Cable TV 63
Internet services 0
Groceries etc. 25
Clothing 25
Petrol/diesel 300
Road tax 24
Car Insurance 31
Car maintenance (including MOT) 50
Car Parking 0
Other travel 0
Childcare/nursery 0
Other child related expenses 0
Medical (prescriptions, dentists, opticians etc.) 0
Pet Insurance/Vet bills 94
Buildings Insurance 21
Contents Insurance 16
Life Assurance 43
Other Insurance 0
Presents (birthday, christmas etc.) 0
Haircuts 8
Entertainment 50
Holiday 0
Emergency Fund 120
Total monthly expenses 1815
Secured & HP Debt Description Debt(£) Monthly(£) APR(%)
Mortgage 100000 (650) 1.5
Secured & HP Debt totals 100000 - -
Unsecured Debt Description Debt(£) Monthly(£) APR(%)
car loan 3500 300 0
santander everyday CC 7000 225 18.9
Tesco Card 10735 214 18.9
Halifax 1834 109 18.9
Natwest 2700 56 18.9
MBNA CC 11100 141 NaN
Unsecured Debt totals 36869 1045 -
Asset Description Value (£)
Cash 0
House Value (Gross) 185000
Shares and bonds 0
Car(s) 8500
Other assets (e.g. endowments, jewellery etc) 0
Total Assets 193500

fatbelly

That seems to say you can make your contractual payments and have £210 left over.

However, your food bill is £25 per month. So changing that to something realistic wipes out your surplus.

I would go for a debt management plan as I said earlier. I wasn't far off with my estimate of £1000 per month as the contractual payments. It's the interest that is the killer.

If you want to re-jig your soa (and others may have some more suggestions) then can you try to pick 'format for mse' as this format is very difficult to read.