How do I get out of this mess?

CLS90

Hi there,

Thanks in advance for taking the time to read this post. I'm seeking advice regarding my current financial situation.

I have been slightly over my £1000 overdraft limit with Monzo (£0.50 per day charge) for the last three months because I have had to move house due to a recent separation.

Each time I receive my salary it barely keeps me out of the Monzo overdraft and charge zone.

I also have an American Express Rewards Card and was considering withdrawing £1000 to put into my Monzo to bring me back to equilibrium.

Would this be considered a good idea?

Any advice is appreciated!

sourcrates

Not really, why are you always short of cash ?
Too much debt, overspending, what’s the reason ?

You should tackle the actual problem, not the symptoms, if your in debt, then look at ways of dealing with it, further borrowing never works.

CLS90

Thanks for your response,

I'm in this current situation because of the move (I had to pay a deposit, rent etc).

Even if I don't borrow any more, after all my bills have been paid I am still -£800 in the Monzo.

Overspending is defiantly an issue and I'm putting a budget together to stop that, but in regards to the situation above, what approach do you think is most reasonable?

Thanks again

snowqueen555

50p a day only works out to £15 a month, it would not be that which is causing you to struggle to keep afloat.

Maybe post a budget and we can help, there isn't much we can do otherwise.

CLS90

Thanks for your message,

A breakdown looks like this:

Monthly Salary After Tax: £1227.48

Bills:

Rent - £420
Childcare - £200
Car - £256.60
Car Insurance - £98.60
Credit Card - £30

After bills: £222.28

The above figure needs to satisfy food, travel and entertainment expenses which as you can imagine it doesn't. Nor is there an option to save.

So as it stands currently with Monzo, after the bills are covered I am still -£800 in the overdraft.

I have just been successful in getting a higher-paid position which should alleviate some of the pressure but as for the overdraft situation, I'm not certain how best to get out of it.

Thanks in advance for any advice!

Naomim

Hi, firstly you have come to the right place for help.

Your car stands out as a high payment. Is this a lease? Can you reduce this at all?. Also childcare. Are these maintenance payments? Theres nothing here for Bill's, are they included in your rent. What about mobile phone etc?

The best thing you can do is complete a full SOA, being honest about what is spent where, and the good people on these boards can give practical solutions.

Naomi

monetxchange

Filling out a complete SOA would help us give advice. The main thing so far is the car is crippling you. It’s not far off a quarter of your earnings. Totally disproportionate for your wage. What’s the deal with it? Is it a lease with a balloon payment? Could you hand it back and draw a line under it? With that gone, you’d be pretty comfortable. Save up for a £2k run around and search for better insurance deals on renewal.

Next thing is your wage. Don’t know how many are in your household but it’s not a great deal. Any scope for increasing that? A full SOA would help. There’s always a way round this. Asking for help and facing up to it is the first step.

sourcrates

CLS90 wrote: »

I have just been successful in getting a higher-paid position which should alleviate some of the pressure but as for the overdraft situation, I'm not certain how best to get out of it.

Hi,

Well one way to do it is to open a new, basic bank account, with a new provider.
Basic accounts have no OD facility, so it encourages you to live within your means, transfer all your banking over to the new account.

You then treat the monzo account as just another debt to service, and transfer an affordable amount to it every month, eventually it will be repaid.

However this will require disipline on your part, as you are £800 into the OD every month, thats a big shortfall to manage without, hopefully your salary will increase to compensate, also try and cut back on things you don`t need.

snowqueen555

Is there any scope to do overtime?

Any scope to claim any benefits/tax credits re child?

JayRitchie

How much extra will you take home with the new position?

username901

£350 a month to run a car on that salary is absolute madness, even if you had another similar salary going in to the household too at the time. I assume that figure includes petrol, tax servicing etc

You need that gone to stand any chance.