DMP: StepChange or self manage?

HonestS

Hi I need to enter a DMP and was wondering what the general consensus is on StepChange. I’ve read amazing reviews for them but also seen some horror stories. If anyone has used them, would you use them again or go self managed? TIA

sourcrates

Hi,

As you know, you don’t need a 3rd party to run a DMP, Stepchange simply pass on your payments to your creditors, on your behalf.

I would always recommend self management as it gives you more control, the Stepchange regime is not for everyone.

HonestS

Thanks, I’m leaning towards self managed but then have a wobble and think I’m better off handing the problem over to SC. Then I think I’m better off in control and knowing exactly where I stand with everything... I’m going round in circles! A common problem at this stage I’m sure ��

Willing2Learn

I self-managed the repayment of all my debts. There is plenty of guidance all over the internet. Have a look at NEDCABs site to support SM.
https://nedcab.cabmoney.org.uk/

Some people choose to initially begin their DMP via SC and then change over to SM once they feel more secure.

HonestS

I’ve just been looking at the NEDCAB website actually, it looks as though they walk you through it.

I’ve not missed any payments but they’re becoming increasingly difficult to meet. Should I cancel all the direct debits before sending out the first round of letters or keep meeting payments? I’m thinking it would be quite handy to stop payments so I can build an emergency fund.

Willing2Learn

If it were me, and the current contractual repayments were unmanageable, then I would cancel all payments to your creditors and send them holding letters so that the debts are frozen while you seek advice. I recommend using the first 3-6 months of frozen accounts to set up an emergency fund (EF). If you wish, you could make £1 monthly token payments to your accounts during this time. Just keep your creditors in the loop as to when full SM DMP payments will start.

Chandelier.

I've no further advice to add then what's already been said but ultimately you have to do what works for you.

Start by writing up a realistic budget. Many people use the SOA budget that is recommended on here. A quick google of SOA stoozing will find you the appropriate links. Work out your outgoings compared to your income and go from there. See what money you have left over at the end of it and what payments you can afford to make to each creditor.

The suggestion of building up an emergency fund is a good one for the unexpected expenses that life throws our way.

Open up a seperate bank account from your current main one and one that is not linked to any of your creditors.

Good luck on your journey and have a look at the DMP thread that's on here. You could also start your own DFW journal to keep yourself accountable and receive the great support many offer on here.

Once you've sorted everything out and work out a debt free date, it will come around before you know it.

Above I mentioned setting a realistic budget, I say this to ensure you factor in all day to day expenses. Don't leave yourself tight at the end of the month and be miserable throughout your journey. You still need to live a little.

NowInspired

I would definitely self manage. That's what we've done, I couldn't bare the thought of anyone telling me what I could or can afford. Being in control makes you feel so much better and you can decide the figures, based on what only you and you alone know you can afford.

HonestS

Thanks for the advice all. I don’t fancy SC telling me what I can and can’t do either to be honest. Plus I have another income from hosting students so I’d like to make additional payments when I can to get it paid up sooner.

The diaries have already helped me to make a saving, after seeing what others are paying for energy bills I did some digging and called BG and they said they’d lower my DD by £32, I then did a price comparison using actual usage numbers and if I switch I’ll save £55 a month!

Time to go through all my outgoing with a fine toothed comb!

Thanks again, appreciate it.