Need to do something now

System

FKIW99 wrote: »

We have one car on the HP its obviously a nice one - I do a lot of miles for work and like having a new reliable car.

I, like you, love nice cars, but you can't afford a nice car at the moment.


There are plenty of new, reliable (albeit not as sexy) cars for half that price.


Apply the Dave Ramsey method - never get a car that's more than half your salary. Plenty of people out there running around in 35k VWs that have sod all money in the bank.

FKIW99

So today I have downloaded and set up the app Yolt so I can track our spending. Straight way it has shown me where our money goes- groceries and eating out. I’ve shown my husband and just by having the awareness now I think we can improve. I have posted one of my guitars and case for sale on Facebook and also got down my sax from the loft that I haven’t played in years so going to sell that. Also prepared a few other bits to sell that I noticed were in the loft when I went for my sax.

Definitely getting the ball rolling now.. just need to keep going unlike last time!

clearmydebts

FKIW99 wrote: »

So today I have downloaded and set up the app Yolt so I can track our spending. Straight way it has shown me where our money goes- groceries and eating out. I’ve shown my husband and just by having the awareness now I think we can improve. I have posted one of my guitars and case for sale on Facebook and also got down my sax from the loft that I haven’t played in years so going to sell that. Also prepared a few other bits to sell that I noticed were in the loft when I went for my sax.

Definitely getting the ball rolling now.. just need to keep going unlike last time!

Hi,

I've a biggish amount of debt too. I'm so sick of it this time. I'm really determined to get rid. Eating out and groceries are my downfalls too. Will watch this thread with interest.

Singlespeeder

I sympathise with your situation. I'm currently £25k in debt but am doing something about it.
The things I've found the most useful ....
a) get a notebook. Write EVERYTHING down in it ... everything. Thoughts, fears, ideas, resolutions. Write down everything you spend money on. Maybe make a simple Legend or key of symbols, a triangle for food, star for beer, square for car expenses, or use coloured highlighters. This little visual aid helps to identify what's costing what. I thought I was being really good with food money .... turns out I was spending £300 a month on a bad month ... this is for 1 person. I've got this down to £140 - £160 ... that's everything, food, beer, going out....

b) go through everything you spend regular money on, and run it through the comparison sites... don't believe anyone will be doing the right thing by you, they aren't. You will almost definitely be able to save a heap there.
c) Food... PLAN ! And stick to it. Buy a slow cooker & use it. Try sneaking some vegetarian meals into the repertoire. At Christmas I thought I'd do "Veggie for January ".... I thought coming from a very meat heavy diet I'd struggle .... far from it. I haven't eaten any meat at all since Dec 29th, and I genuinely haven't missed it. Meat is very expensive compared to veggie. Lentils cost next to nothing and make an awesome chilli, curry or stew, all done in slow cooker. I basically allow myself £5 a day, £35 a week,£140 a month. This would scale up for a family but not exponentially. Buy in bulk, cook in bulk and freeze. I could easily do a slow cooker full of veggie red lentil curry, or Moroccan veggie stew (both are superb and flavoursome) for maybe £5, probably less. I would certainly get 8 - 10 portions out of this. It's all about planning.
d) work out how much you spend on Annual stuff ... car insurance, tax, mot, christmas, birthdays etc.. ( mine is around £1500) ... the worst one is car insurance at £450 on the 4th January ... ouch ! I now physically put £150 a month into a savings account ... this should cover EVERYTHING I need, hopefully with a little bonus nudge too. Now in January, the £450 for the insurance won't go on a credit card, it's already budgeted for.

Good luck and be strong.

tlc678910

Hi OP,
I'm going to suggest what is often considered on here "the unthinkable" and say that you should sell your house.

The reasons why this is usually seen as a last resort include:
that renting is expensive;
that people "usually" have destroyed their credit rating and/or have a low income and will find it hard to start again;
the fact that it is usually possible to keep your house e.g. DMP plan.
The fact people are overspending and will burn through the equity.

You are in a position where it is very difficult for you to pay down your debt - you have been trying - but making no progress. - I'm not judging just pointing out your tough position.

You sound like you have juggled your credit so far and actually have a great income, so it should not be impossible for you to buy again in future.

You have held your debt reasonably static (considering it's size and the interest payments) and so I don't think you are burning through money.

You are at an expensive stage of life where you want to provide for your kids and save for your future not get by by squeezing every penny and wearing dressing gowns inside all winter.

Sell your house. Rent. Pay off all your debt. It looks like you will still be left with around 10% deposit for a similar house. Save/have your baby and look at getting back on the property ladder ASAP.

You are lucky that the equity in your house can rescue you. It's important to make sure you don't do the same again so keep a close eye on your finances/budgeting with a view to saving more deposit.

Good luck whatever you decide.

worriedDan

Hi,

I wanted to post to offer some support. I am not in a position to offer financial advice as such but I can tell you that we started in a similarish position with 65K unsecured debt plus a mortgage. At the start we had a similar income to you. Some of the debt was 0% but some of it was at higher interest rates similar to yours.

Over the last 2 years we have managed to pay off about half of the debt without going onto a DMP or anything similar. Our interest rates were also around 20 percent

I don't think that you need to resort to a DMP at this stage as you do have some spare income. I also think that you can save money on your groceries and as you have said, the childcare costs will reduce soon. I reckon you could save £500 per month which you could throw at your debts. We started with the highest interest first and before long our minimum payments were reducing, meaning that our overpayments had a greater effect on the balance month on month. We were paying around £1300 per month at the start.
We have had some bumps along the way and we have fallen off the wagon once or twice but overall we have managed to keep focussed and you can too. Try not to think of the total debt balance but instead take it month by month. We budget each month and look at how much we can overpay.

My view is that you also need to factor in some fun money. Life cannot and should not be all about debt repayment. We made that mistake at the start and it led to problems for us - my wife was very unhappy but was worried to discuss it as she knew how much the debt concerned me. We take a more balanced approach now and we don't beat ourselves up if we have the odd slip up.

With regards to having another baby, we are a one child family and we would have loved another but sadly it's not to be - nothing to do with money though. If we were able to have another then we would so my view is that you shouldn't let your financial situation stop you. Perhaps wait a year until you have made significant inroads into the debt? I didn't see your ages and appreciate that this may be a factor.

Getting in control of you money will make you feel so much better. I really struggled with the emotional impact of our debt level, however just having a manageable plan in place made such a difference.

You really can do this - happy to answer any questions based on our experience. good luck!

FKIW99

Singlespeeder wrote: »

I sympathise with your situation. I'm currently £25k in debt but am doing something about it.
The things I've found the most useful ....
a) get a notebook. Write EVERYTHING down in it ... everything. Thoughts, fears, ideas, resolutions. Write down everything you spend money on. Maybe make a simple Legend or key of symbols, a triangle for food, star for beer, square for car expenses, or use coloured highlighters. This little visual aid helps to identify what's costing what. I thought I was being really good with food money .... turns out I was spending £300 a month on a bad month ... this is for 1 person. I've got this down to £140 - £160 ... that's everything, food, beer, going out....

b) go through everything you spend regular money on, and run it through the comparison sites... don't believe anyone will be doing the right thing by you, they aren't. You will almost definitely be able to save a heap there.
c) Food... PLAN ! And stick to it. Buy a slow cooker & use it. Try sneaking some vegetarian meals into the repertoire. At Christmas I thought I'd do "Veggie for January ".... I thought coming from a very meat heavy diet I'd struggle .... far from it. I haven't eaten any meat at all since Dec 29th, and I genuinely haven't missed it. Meat is very expensive compared to veggie. Lentils cost next to nothing and make an awesome chilli, curry or stew, all done in slow cooker. I basically allow myself £5 a day, £35 a week,£140 a month. This would scale up for a family but not exponentially. Buy in bulk, cook in bulk and freeze. I could easily do a slow cooker full of veggie red lentil curry, or Moroccan veggie stew (both are superb and flavoursome) for maybe £5, probably less. I would certainly get 8 - 10 portions out of this. It's all about planning.
d) work out how much you spend on Annual stuff ... car insurance, tax, mot, christmas, birthdays etc.. ( mine is around £1500) ... the worst one is car insurance at £450 on the 4th January ... ouch ! I now physically put £150 a month into a savings account ... this should cover EVERYTHING I need, hopefully with a little bonus nudge too. Now in January, the £450 for the insurance won't go on a credit card, it's already budgeted for.

Good luck and be strong.

Thank you very much for your advice, that's all really helpful. I am actually vegetarian leaning towards vegan but my husband is a meat eater and mentally is quite stuck with not even considering not eating meat with a meal (im working on this though!). We do have a slow cooker but haven't used it for probably a year - i will dig it out of the pantry and look up some recipes. Thank you for the inspiration!

FKIW99

tlc678910 wrote: »

Hi OP,
I'm going to suggest what is often considered on here "the unthinkable" and say that you should sell your house.

The reasons why this is usually seen as a last resort include:
that renting is expensive;
that people "usually" have destroyed their credit rating and/or have a low income and will find it hard to start again;
the fact that it is usually possible to keep your house e.g. DMP plan.
The fact people are overspending and will burn through the equity.

You are in a position where it is very difficult for you to pay down your debt - you have been trying - but making no progress. - I'm not judging just pointing out your tough position.

You sound like you have juggled your credit so far and actually have a great income, so it should not be impossible for you to buy again in future.

You have held your debt reasonably static (considering it's size and the interest payments) and so I don't think you are burning through money.

You are at an expensive stage of life where you want to provide for your kids and save for your future not get by by squeezing every penny and wearing dressing gowns inside all winter.

Sell your house. Rent. Pay off all your debt. It looks like you will still be left with around 10% deposit for a similar house. Save/have your baby and look at getting back on the property ladder ASAP.

You are lucky that the equity in your house can rescue you. It's important to make sure you don't do the same again so keep a close eye on your finances/budgeting with a view to saving more deposit.

Good luck whatever you decide.

Thanks for your message. I have actually considered this option, but I don't think we would ever do it unless it really was our only option. We were lucky to buy our house at the price we did and it has lots of potential to increase in value, plus its in a fantastic rural location. We would never get somewhere like this again if we sold it.

Thank you though

FKIW99

worriedDan wrote: »

Hi,

I wanted to post to offer some support. I am not in a position to offer financial advice as such but I can tell you that we started in a similarish position with 65K unsecured debt plus a mortgage. At the start we had a similar income to you. Some of the debt was 0% but some of it was at higher interest rates similar to yours.

Over the last 2 years we have managed to pay off about half of the debt without going onto a DMP or anything similar. Our interest rates were also around 20 percent

I don't think that you need to resort to a DMP at this stage as you do have some spare income. I also think that you can save money on your groceries and as you have said, the childcare costs will reduce soon. I reckon you could save £500 per month which you could throw at your debts. We started with the highest interest first and before long our minimum payments were reducing, meaning that our overpayments had a greater effect on the balance month on month. We were paying around £1300 per month at the start.
We have had some bumps along the way and we have fallen off the wagon once or twice but overall we have managed to keep focussed and you can too. Try not to think of the total debt balance but instead take it month by month. We budget each month and look at how much we can overpay.

My view is that you also need to factor in some fun money. Life cannot and should not be all about debt repayment. We made that mistake at the start and it led to problems for us - my wife was very unhappy but was worried to discuss it as she knew how much the debt concerned me. We take a more balanced approach now and we don't beat ourselves up if we have the odd slip up.

With regards to having another baby, we are a one child family and we would have loved another but sadly it's not to be - nothing to do with money though. If we were able to have another then we would so my view is that you shouldn't let your financial situation stop you. Perhaps wait a year until you have made significant inroads into the debt? I didn't see your ages and appreciate that this may be a factor.

Getting in control of you money will make you feel so much better. I really struggled with the emotional impact of our debt level, however just having a manageable plan in place made such a difference.

You really can do this - happy to answer any questions based on our experience. good luck!

Thank you so much for your wonderful message. Every time I check the forum to see if anyone has commented my stomach aches a bit, having to accept the situation we are in and the fact that selling our home is even an option (as mentioned in another comment) not that we would do it. But your message in particular made me outwardly say ah wow and my husband asked what i was reading. Well done on doing so well paying off half of your debt - thats amazing! You are a real inspiration and to hear how our situation is quite similar to yours when you started has given me hope that we can really do this. It sounds like me and your wife are quite similar, I worry a lot about the effect our debts have on my husband as he has a history of depression in his family and I worry that he would hide it. He works so hard for us.
I feel better already now we have discussed this all properly and I have set up the Yolt app where I can see where our money goes and track our spending. The income on our SOA is the minimum we both earn and often earn more so Im confident that if we reel in our spending we can have a good chunk extra to pay off each month.
We have decided to wait a year to have another baby, I am only 28 and my husband is 33 so I don't think there is any immediate need to have another. Im sorry to hear your situation regarding a second child.
If I think of any questions or need advice I will be sure to ask.
Thank you for giving me hope

FKIW99

Woop just discovered that from sept our monthly payment for electricity will be down to £65 a month instead of £89 - every little helps!