Help with debt please

021286

Thanks all for the suggestions. I have opened up a Monzo easy access saver today (thats just the easiest option for me at the moment) with £10 in it, I am still going to priorities throwing money at my debts but I think every time I forgo a night out for a night in or something similar I will try and put most of what I would have spent towards the debt, and maybe a tenner of it into the savings, something like that. I do already use the round up function on Monzo which is great I always manage to save about £60 a month in there without doing anything, however I usually just spend this so going forward I would like to throw this at debt.
Thanks again for everyone's help and advice I am so grateful!

FTBlalala

You are doing fab It is super tough but you are taking the right steps. I see that you have opened another account in Monzo. As some others have said; I have my 'Emergency' pot in a Nationwide account that I don't have the app on my phone for. I have to go online to move any money out of it and by the time I log in etc I'm then questioning why I need it. Out of sight out of mind has been key to my savings. Keep going!

021286

Thanks all.

I signed up for MSE Credit Expert today, and it’s showing my affordability as poor which I was expecting... it says my debt ratio is low compared to my salary (good) but I’m obviously at the top end of my credit utilisation (bad). Thats fine and expected, but then it goes on to say that my disposable income is low- which I know isn’t true, as I can pay my debts and then the rest of my income is easily disposed ie frittered! 

However I’m aware that until recently I was borrowing to maintain this so that’s not strictly true, but I just wondered how they calculate your disposable income? 

monetxchange

Credit Expert is an Experian product, Credit Club is the MSE one. I’ve found with any credit reporting things that they’re often slow to update and aren’t perfect. It doesn’t really matter what disposable income it thinks you have - what’s important is you know what you have left after budgeting and therefore can throw at the debt. Don’t get too caught up in what your credit file looks like, as it’s not really relevant. It’s not going to be perfect after years of borrowing and maxing out, but that doesn’t actually matter as you won’t be taking on more credit!

 Edit to say: I’ve just done my own Credit Club report and in disposable income it says “it looks like”, which to me says it’s a rough calculation. So I’m guessing it’s looking at your rent/mortgage you entered, your minimum debt repayments and minusing it from your income as a rough calculation. Don’t think it’s a particularly crucial factor.

021286

Thank you! You’re right of course- I’m not looking to borrow anything so it doesn’t matter.

I have a default on my account that will drop off permanently (6 years old) in October of this year, I’m really keen to pay off as much of my debt as I can before then and just make sure my credit report is in otherwise good shape so that I can hopefully go into 2021 with thing improved.
I have an old Halifax current account at 0 balance that I haven’t used for years- I’m talking at least 5. I forgot I had it to be honest. Is it best to leave this as is, or close it down? There’s no overdraft or money owed on it, and I don’t even have a debit card for it anymore.

monetxchange

Credit scores aren’t really that important. They’re a bit of a marketing tool. What’s important is your credit history - reality is, that’s not going to change overnight, but defaults and bad money management will drop off your history eventually. You’ll get there!

 Funnily enough, I also have an old Halifax account I never use. Never causes me any issues. I don’t think it looks bad to have an account sitting there long term at £0 owing on your file, so maybe leave it unless you really want to get rid of it.

foxgloves

Re savings..... (& I say this as a reformed ex-spender).... I don't think there's really any such thing as 'willpower', just choices. Either you can choose to build an emergency fund, which will help you feel more financially secure & be there for you to help with genuine emergencies, or you can choose to keep dipping into it for non-emergencies. Both choices are available to you, but only one will help you to avoid further debt should an emergency situation rear its head. As someone who never had an emergency fund, but now wouldn't be without one, I can attest to the greater feeling of security it brings. So forget 'willpower' & just make the choice to have one!
F

021286

Thanks foxgloves. You’re right of course- the reason the debt started is because my marriage ended, I had no emergency fund, so things like removal vans and rental deposits all went on the credit card, and I’ve been playing catch up ever since (whilst also spending beyond my means). An emergency fund is important, so I will be building this up from now with whatever I can. Thanks all.

021286

I went on MSE credit club this morning and saw that I was guaranteed eligible for a 0% balance transfer card with Fluid, with 0% for 9 months. I have applied and it said I was accepted, but now I've signed the form it says they need to look into my application further so I suppose I might not have been accepted after all, which is a bit annoying as I wouldn't have signed if it wasn't guaranteed. ANYWAY.
I've been accepted at a 29.9% rate, so I was thinking that depending on how much of a balance they give me (up to £1200) I could pay off the Dot Dot loan with my bonus, and also pay off as much of the Capital One as possible (hopefully just £300) to then transfer the remaining to the Fluid card and then that will at least be on 0% for 9 months and I have a bit of breathing space there- and even after that (although I would hope to be able to pay it off in that time) the rate is better than I'm paying with Capital One now. 
That would then leave me with about £500 from my bonus, which I could use to clear Likely and almost all of Vanquis, before knuckling down and paying the rest off in high interest order after that.
Does that sound like a sensible idea or have I just made a very stupid mistake? It's frustrating that they don't show you your limit until they send you the card, as if they only give me £300 then I wouldn't have bothered applying at all, I don't want the card if that's the case.

monetxchange

They didn’t tell you the limit? Are you sure that won’t come until the card arrives? I’ve never come across that before. Remember there will be a balance transfer fee too - so take that into account when looking at how much you can transfer. Just to clarify - is it 0% or 29%?