Over 30K in unsecured debt SOA

D_M_E

Do not miss the council tax payment without first asking them.

Contct the council and explain that, because of difficulty this month's instalment will be 2 weeks late, get their agreement that this will be acceptable and if you do it by phone make sure you record the conversation.

I once had problems and paid council tax 4 days late and they demanded payment of what was left - about £700 at the time - but they backed down after I went to the offices and complained about being only 4 days late, said the letter should not have been sent.

Get their agreement first.

enthusiasticsaver

Whilst I understand changing to an interest only mortgage until you have got yourself sorted opting out of your pension is mad if they contribute 10% on your sort of salary. However you are in a real mess so unfortunately it seems you have no choice. Make it a priority once you are on an even keel to opt back in and of course change the mortgage back to repayment.

I think you should reduce the entertainment And presents and No holiday savings until you are rid of the payday loans. Some people have got refunds from these companies if they have been shown to lend irresponsibly so it might be worth investigating that. The 118 loan should be first on your target list. FWIW consolidating debt as you presumably have in the past is the worst way of dealing with debt problems. Obviously the gambling was your catalyst for the debt and well done for getting to grips with this. As you pay off the expensive credit cards close them down so you are not tempted to use them again.

On the plus side you have a good salary, a generous bonus scheme and as you give up the counselling and repay the student loan you will be in a great position. You have 1200 spare each month assuming your soa is correct so once the payday loans are gone focus initially on the most expensive debts. Unfortunately none of your debts are cheap so I agree with others that you don't have the luxury of time to deal with them so cutting back as far as possible for the next year is sensible. I think a year to get rid of it is optimistic given the interest rates but you should be in a much better position by getting rid of the worst of them.

Your immediate problem is the £1000 shortfall for this month. Cut back on food as much as possible as I think you could save £100 on that by shopping at Lidl, Aldi etc, forget holiday savings, presents, entertainment and clothes for this month. If you can somehow get the student loan waived this month that would make the £1000. Don't miss the council tax without checking as others have said it then becomes due in full and imprisonment will not help you let alone costs although if it is only one month hopefully they would not be that quick off the mark.

MortgageDonkey

Been through the PDL saga few years ago and gor the sane reasons. In a much better place now. Have you thought about a debt chrity stepchange? Although in some professions thats a big no no.

Good luck

deux_x_m

It's a lot of money to owe, but you have a decent income and if you are disciplined with yourself I honestly think you can get yourself straight without too much pain.

Having said that the biggest obstacle to me is the money needed this month - you said you were £1000 short. If you can get past that hurdle somehow, and stick to a strict budget, then you can get on with targeting the debts.

Assuming your SOA is accurate (pretty sure it won't be 100% - not a criticism, just the first one never seems to be. Eg are there any bank chgs or interest on your overdraft) you have approx £1200 per month to pay over and above the minimum payments. This is without cutting any of the spending you have ear-marked for holidays, food, clothes etc.

The interest rates are horrible but if your credit rating is poor you are stuck with them, so may as well suck it up and get on with it. The biggest frustration when I started was wanting to be debt free in about 3 months and not seeing much progress due to the interest added each month. It does get better and as the months go by I can see the balances coming down and I feel like I am getting somewhere. I log everything I spend on a spreadsheet and then have another with all my debts listed and showing my projected balance for the coming months, projected future payments, total debt each month, percentage paid off etc. Geeking out but I find it really motivational.

Sort out this month and I don't see the need to miss a loan or council tax payment. If you can get to a starting place then you are in a good position for the future - you have a good job/salary, a flat with decent equity and started a pension way before me.

I haven't had a gambling problem, but make sure you don't quit the counselling too soon. As has already been said this could cost you much more in the long run.

This is fixable - good luck!

JayRitchie

dfw2019 wrote: »

Hi, thanks for your help!
Student loan I would have to call and check again next week but I believe it's around 7000 at this point. Yes it's missing from the SOA, I was thinking about payments that come out of my bank account so forgot about it (it usually comes out of my wages before I get them)

I've been giving this some thought. At the moment (subject to not having any dramas at work) you have, in substance, a cash flow issue far more than a debt issue. Am I right in getting the impression that you enjoy your work so no particular need to wish to change jobs/ careers?

Just to confirm:

- the take home pay of £5544 is stated after the deduction of £700 a month which was previously being taken and assumes no pension contributions (so when the £700 a month is added back your take home would be £6,244?

- how will the student loan be taken going forward? I think you've noted that it is a DD (as opposed to a standing order). Are you able to cancel the DD? I'm not sure how they work on personal accounts but they can be a nightmare with business accounts.

- For the two wedding you have this year, which months are they and what is a realistic budget? When would you need to pay and how much have you paid so far?

JayRitchie

Oh, and just to be sure, is you pension scheme DC rather than final salary?

dfw2019

enthusiasticsaver wrote: »

Whilst I understand changing to an interest only mortgage until you have got yourself sorted opting out of your pension is mad if they contribute 10% on your sort of salary. However you are in a real mess so unfortunately it seems you have no choice. Make it a priority once you are on an even keel to opt back in and of course change the mortgage back to repayment.

I think you should reduce the entertainment And presents and No holiday savings until you are rid of the payday loans. Some people have got refunds from these companies if they have been shown to lend irresponsibly so it might be worth investigating that. The 118 loan should be first on your target list. FWIW consolidating debt as you presumably have in the past is the worst way of dealing with debt problems. Obviously the gambling was your catalyst for the debt and well done for getting to grips with this. As you pay off the expensive credit cards close them down so you are not tempted to use them again.

On the plus side you have a good salary, a generous bonus scheme and as you give up the counselling and repay the student loan you will be in a great position. You have 1200 spare each month assuming your soa is correct so once the payday loans are gone focus initially on the most expensive debts. Unfortunately none of your debts are cheap so I agree with others that you don't have the luxury of time to deal with them so cutting back as far as possible for the next year is sensible. I think a year to get rid of it is optimistic given the interest rates but you should be in a much better position by getting rid of the worst of them.

Your immediate problem is the £1000 shortfall for this month. Cut back on food as much as possible as I think you could save £100 on that by shopping at Lidl, Aldi etc, forget holiday savings, presents, entertainment and clothes for this month. If you can somehow get the student loan waived this month that would make the £1000. Don't miss the council tax without checking as others have said it then becomes due in full and imprisonment will not help you let alone costs although if it is only one month hopefully they would not be that quick off the mark.

Yes, it was definitely a last resort to give up the pension contributions. I plan to start them again as soon as I've paid off the very high interest loans.

I've looked a little into the payday loans refunds. I've probably paid in excess of £10K in interest over the years so it would be amazing if I could get some of that back. I'm just not sure if it counts as 'irresponsible' if I could afford the repayments if it wasn't for my gambling (although the last couple of PDLs have been genuinely unaffordable even without the gambling). I've sent off a couple of emails though and will see what comes back.

Thanks for the advice & support!

dfw2019

MortgageDonkey wrote: »

Been through the PDL saga few years ago and gor the sane reasons. In a much better place now. Have you thought about a debt chrity stepchange? Although in some professions thats a big no no.

Good luck

Thanks for the support, great to hear from someone who has come through the other side. I did put all the details into StepChange (excluding the PDLs) and they basically said that I could afford to pay off the debt so I didn't need to take more drastic action such as a DMP. That seems to be the consensus on here too.

dfw2019

JayRitchie wrote: »

I've been giving this some thought. At the moment (subject to not having any dramas at work) you have, in substance, a cash flow issue far more than a debt issue. Am I right in getting the impression that you enjoy your work so no particular need to wish to change jobs/ careers?

Just to confirm:

- the take home pay of £5544 is stated after the deduction of £700 a month which was previously being taken and assumes no pension contributions (so when the £700 a month is added back your take home would be £6,244?

- how will the student loan be taken going forward? I think you've noted that it is a DD (as opposed to a standing order). Are you able to cancel the DD? I'm not sure how they work on personal accounts but they can be a nightmare with business accounts.

- For the two wedding you have this year, which months are they and what is a realistic budget? When would you need to pay and how much have you paid so far?

Yes I enjoy my job and don't plan to move anytime soon.

Sorry I think I am being confusing re. the take home pay and student loans. The 5544 is the amount I take home before the deduction (it used to be less when the loan was taken out of my wages). From last month it is taken as a DD which I presume I can cancel similar to any other DD.

I need to pay for the hotels for the weddings but that can be done nearer the time (in a couple of months).

Thanks so much for all your help. It's great how helpful & supportive people on here are, especially when it was my own stupidity that got me into this mess!

JayRitchie wrote: »

Oh, and just to be sure, is you pension scheme DC rather than final salary?

Yes it is DC.

Grumpelstiltskin

OK So your biggest problem is getting through the next couple of months.

So what can you do.

Contact the council regarding paying council tax over 12 months instead of 10.

Don't spend anything unless it is vital.

Go through your fridge, freezer and cupboards, it may result in some odd meals, but it will save money.

You get a free breakfast so take advantage, eat as much as you can then you won't want much at lunchtime. Can I suggest you do buy a couple of bananas if you like them and have one at lunchtime, make sure you buy them from the cheapest possible place don't fall into the Tesco Express trap where they charge an arm and a leg.


Entertainment, has to go if it costs money.


Haircut leave it an extra week and look for somewhere cheaper.


PPI Have you checked that?

All these are only small things but as the saying goes every little helps.