📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

32k in credit card debt where do I start??

Options
135

Comments

  • Fatsdom
    Fatsdom Posts: 52 Forumite
    Part of the Furniture 10 Posts Name Dropper Combo Breaker
    Come on man, I'm not sure these figures are totally accurate, percentage points missing and some important columns missing. Is your MOT free? We desperately want to help, but please have a look at your SOA again. Fill in what you do owe/spend, not what you'd like to spend. The people here are absolute experts in this field, the best there is, but we need to see the whole gory truth. 
  • leroy1980
    leroy1980 Posts: 15 Forumite
    Ninth Anniversary 10 Posts Combo Breaker
    Ive went back through after looking at some statements add added a few things I had not put on. Added my girlfriend, although she doesn't live with me full time she is there a lot

    Household Information
    Number of adults in household........... 2
    Number of children in household......... 0
    Number of cars owned.................... 1

    Monthly Income Details
    Monthly income after tax................ 2470.11
    Partners monthly income after tax....... 0
    Benefits................................ 0
    Other income............................ 0
    Total monthly income.................... 2470.11

    Monthly Expense Details
    Mortgage................................ 473
    Secured/HP loan repayments.............. 0
    Rent.................................... 0
    Management charge (leasehold property).. 0
    Council tax............................. 108
    Electricity............................. 34
    Gas..................................... 34
    Oil..................................... 0
    Water rates............................. 32.63
    Telephone (land line)................... 0
    Mobile phone............................ 16
    TV Licence.............................. 13.2
    Satellite/Cable TV...................... 56
    Internet Services....................... 41.24
    Groceries etc. ......................... 400
    Clothing................................ 100
    Petrol/diesel........................... 270
    Road tax................................ 18
    Car Insurance........................... 60.23
    Car maintenance (including MOT)......... 20
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 0
    Other child related expenses............ 0
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 15.98
    Buildings insurance..................... 8
    Contents insurance...................... 8
    Life assurance ......................... 0
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 0
    Haircuts................................ 0
    Entertainment........................... 100
    Holiday................................. 0
    Emergency fund.......................... 0
    Misc purchases.......................... 200
    union fees.............................. 20.9
    Total monthly expenses.................. 2029.18

    Assets
    Cash.................................... 0
    House value (Gross)..................... 155000
    Shares and bonds........................ 0
    Car(s).................................. 6000
    Other assets............................ 0
    Total Assets............................ 161000

    Secured & HP Debts
    Description....................Debt......Monthly...APR
    Mortgage...................... 107680...(473)......2.3
    Total secured & HP debts...... 107680....-.........-

    Unsecured Debts
    Description....................Debt......Monthly...APR
    HSBC Loan......................9690.35...236.3.....6
    MBNA 1.........................8368.7....189.9.....18.93
    MBNA 2.........................4118.83...41........0
    SCS............................1500......109.......0
    next...........................999.......50........24.9
    very...........................1300......46........23
    Amazon newday..................6742.48...191.......21.9
    Halifax........................6081.36...60.81.....0
    Lloyds.........................6318.21...63.5......0[b]
    Total unsecured debts..........45118.93..987.51....-  

    Monthly Budget Summary
    Total monthly income.................... 2,470.11
    Expenses (including HP & secured debts). 2,029.18
    Available for debt repayments........... 440.93
    Monthly UNsecured debt repayments....... 987.51
    Amount short for making debt repayments. -546.58

    Personal Balance Sheet Summary
    Total assets (things you own)........... 161,000
    Total HP & Secured debt................. -107,680
    Total Unsecured debt.................... -45,118.93
    Net Assets.............................. 8,201.07

  • TheAble
    TheAble Posts: 1,676 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    Definitely should be something in the entry for car maintenance. I've known a few people over the years who have had X5s and they can be real money pits. £400 just for a new tyre and so on. Also is £18/month for car tax correct? Assuming the vehicle is not pre-2001 then I believe you're talking close to £600/yr.
    Agreed on the groceries. As Dave Ramsey would say: "Rice and beans!"
  • leroy1980
    leroy1980 Posts: 15 Forumite
    Ninth Anniversary 10 Posts Combo Breaker
    edited 7 June 2020 at 10:22AM
    Car tax is only £180 to £220 I can't remember which but I paid it off in one , on a card which is why I'm in this position I suppose.
  • Naomim
    Naomim Posts: 3,117 Forumite
    Part of the Furniture 1,000 Posts Photogenic Name Dropper
    Hi Leroy and welcome, 

    Thanks for reposting your SOA. The immediate areas that need looking at are:

    TV - can you change to just Netflix @ £10 a month for now.

    Internet -can you change provider. Are you tied into a contract

    Groceries - this is where you can make the biggest savings. £400 will feed a family of 4 for a month usually.  Try dropping brands,  some you'll like some you wont. Meal plan for the week & shop to a list. Dont forget lunches to stop spending on meal deals. I found we actually ate a far more varied diet and meals once I started planning.

    Clothing - £100 a month is high are you spending this? How much of your wardrobe are you wearing? I know trainers etc are expensive. I have a 6"1 14year old with size 12 feet. 

    What are the miscellaneous spends and entertainment? Coffees, lunches, meals out, gaming, music. Have a look at this in micro detail and see where this all goes. I had a coffee shop habit and was spending about £25 a week. It all adds up. 

    I'd also suggest keeping a spending diary on your phone. Anything you spend. Add it, categorise it. It can make you think twice about buying something when you see how much you're spending. 

    Good luck

    Naomim 
    Credit Cards NOV 2019 £33,220.42 Sept 2023 £19,951.00 Tilly Tidy 20223/COLOR] Sept £43.71 Here's my diary: A Ditherer's Diary Again
  • IrishSean
    IrishSean Posts: 397 Forumite
    Fourth Anniversary 100 Posts Name Dropper
    Hi Leroy,
    I might be the bearer of bad news and I bow to the greater wisdom of others but without knowing your pension contribution my guess is your salary is low 30ks and you have a mortgage.
    Your debt is at least £45k... you've done the right thing posting up her but i'm reckoning a few things:
    1) in the current climate 0% deals may be few and far between: look at your credit file on clearscore, mse credit forum etc. and post up your % credit utilised. 
    2) with those debts and even stretching to £300 a month your 0%s will end before you make a significant dent
    3) your unsecured debt is circa 1.5 times your annual salary; i'd say you need to be contacting a free debt management charity from tomorrow: a debt management plan is urgent, imho. Youre over the £20k limit for a Debt Relief Order (restrictions there anyway). Forum am I right in thinking an Individual Vol Arrangement might be the outcome?

    I agree bankruptcy isn't an option as you have your own home: you can't let it get to that point. 

    In the meantime:
    Cut your spending to the bone, but be realistic, e.g. you need money to keep a car on the road.
    The £200 misc. Needs a budget: mate that's half your potential debt payment in the short term right there. 
    You must post when each of those 0% end.. I had 1 card with £11k on it not at 0% & it felt like swimming in treacle!

    You can absolutely do this: a debt charity will give you a time frame, maybe 5 years to be debt free. You might have to look at boosting income too though, job promotion, weekend work etc. 

    GL; start a diary in this section of the forum. Copy and paste your SOA, ppl on this forum are excellent helping you on the journey. Read the other diaries  to see how far ppl have come before you
    😀💪
    Admin for Tilly Tidy to £1825 DFW challenge: 2021
    Rolling Total for 2021: £970
  • IrishSean
    IrishSean Posts: 397 Forumite
    Fourth Anniversary 100 Posts Name Dropper
    Also, I buy and sell 2nd hand motors; your street cred might be shot moving from an x5 but there are smaller, economical cars out there that really suit tall drivers like a seat leon or altea or, wait for it, a honda jazz. You'll picks these up for a couple of grand. They're super reliable and cheap to run. It's about cutting costs and protecting the house. Other cars bit the bill too, dr google, honest john websites good too. 
    Admin for Tilly Tidy to £1825 DFW challenge: 2021
    Rolling Total for 2021: £970
  • ryanm8655
    ryanm8655 Posts: 1,210 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    leroy1980 said:
    Ive went back through after looking at some statements add added a few things I had not put on. Added my girlfriend, although she doesn't live with me full time she is there a lot

    Household Information
    Number of adults in household........... 2
    Number of children in household......... 0
    Number of cars owned.................... 1

    Monthly Income Details
    Monthly income after tax................ 2470.11
    Partners monthly income after tax....... 0
    Benefits................................ 0
    Other income............................ 0
    Total monthly income.................... 2470.11

    Monthly Expense Details
    Mortgage................................ 473
    Secured/HP loan repayments.............. 0
    Rent.................................... 0
    Management charge (leasehold property).. 0
    Council tax............................. 108
    Electricity............................. 34
    Gas..................................... 34
    Oil..................................... 0
    Water rates............................. 32.63
    Telephone (land line)................... 0
    Mobile phone............................ 16
    TV Licence.............................. 13.2
    Satellite/Cable TV...................... 56 Don’t need this
    Internet Services....................... 41.24 This is high, much cheaper available
    Groceries etc. ......................... 400 Crazily high for one person, even if your gf is there occasionally.
    Clothing................................ 100 Too high, I like nice clothes but this is a lot. Do you need new clothes in the short/medium term?
    Petrol/diesel........................... 270 Seems high, what engine does your x5 have? How many miles are you doing for work?
    Road tax................................ 18
    Car Insurance........................... 60.23 Again, seems high. I have an Audi and a serious conviction that massively impacts the cost of my insurance and it’s cheaper than this...
    Car maintenance (including MOT)......... 20 Too low for the car you have, an annual service and MOT without consumables will eat up most, if not all of this.
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 0
    Other child related expenses............ 0
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 15.98 
    Buildings insurance..................... 8
    Contents insurance...................... 8
    Life assurance ......................... 0
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 0 Nothing?
    Haircuts................................ 0 Do you cut your own? If not need something here.
    Entertainment........................... 100 Seems low once we are out of lockdown given you spend £100/month on clothes...
    Holiday................................. 0
    Emergency fund.......................... 0
    Misc purchases.......................... 200 What does this cover? You can’t afford to be blowing £200 a month willy nilly with your current debt.
    union fees.............................. 20.9 Has this been useful to you? Not a big item but I don’t bother with a union (I’m public sector).
    Total monthly expenses.................. 2029.18

    Assets
    Cash.................................... 0
    House value (Gross)..................... 155000
    Shares and bonds........................ 0
    Car(s).................................. 6000
    Other assets............................ 0
    Total Assets............................ 161000

    Secured & HP Debts
    Description....................Debt......Monthly...APR
    Mortgage...................... 107680...(473)......2.3
    Total secured & HP debts...... 107680....-.........-

    Unsecured Debts
    Description....................Debt......Monthly...APR
    HSBC Loan......................9690.35...236.3.....6
    MBNA 1.........................8368.7....189.9.....18.93
    MBNA 2.........................4118.83...41........0
    SCS............................1500......109.......0
    next...........................999.......50........24.9
    very...........................1300......46........23
    Amazon newday..................6742.48...191.......21.9
    Halifax........................6081.36...60.81.....0
    Lloyds.........................6318.21...63.5......0[b]
    Total unsecured debts..........45118.93..987.51....-  

    Monthly Budget Summary
    Total monthly income.................... 2,470.11
    Expenses (including HP & secured debts). 2,029.18
    Available for debt repayments........... 440.93
    Monthly UNsecured debt repayments....... 987.51
    Amount short for making debt repayments. -546.58

    Personal Balance Sheet Summary
    Total assets (things you own)........... 161,000
    Total HP & Secured debt................. -107,680
    Total Unsecured debt.................... -45,118.93
    Net Assets.............................. 8,201.07


    Could your GF move in and start paying rent/towards bills/food. It sounds as though she basically lives there without paying, since you’ve added her to the SOA.

    Personally, I think there are a number of big savings and lifestyle changes you can make that make your debt payments just about affordable but you could be in trouble when the 0% deals run out. I’ve suggested areas you could make savings in bold above.

    You've suggested you could sell some stuff that will help in the short term. This is a good idea and will help bring the minimum payments down as well, E.g. if you cleared the next and very debts. Your car also seems to be expensive to run, you’ve suggested you could downgrade this, which will free up a bit of cash to clear more debts but also could save you money on running costs and free up more cash.

    Also are you travelling that much in lockdown? Are a number of these expenditures a lot lower currently due to home working and less entertainment? I know my expenses are. If so take advantage and plough all that spare cash into the debt. You need a plan and you need structure to your finances though. Seems like you’ve fallen into the trap that a lot of us fall into. Meandering through without really thinking about the debts building up, sticking holidays/emergency expenses on 0% cards and then down the line !!!!!! hits the fan when the deals end. It’s a really good step that you have all of this written down btw. I avoided adding my total up for several years and would try to avoid looking at bank statements etc.

    Others may have a different opinion to me. Personally I’d want to avoid DMP at all costs but you have a house, I don’t.

    August 2019: £28.8k

    November 2020: £0 (0% interest)

    My debt free diary: https://forums.moneysavingexpert.com/discussion/comment/77330320#Comment_77330320


  • RobM99
    RobM99 Posts: 2,709 Forumite
    Eighth Anniversary 1,000 Posts Photogenic Name Dropper
    £32 for water seems high, try a meter.
    Now a gainfully employed bassist again - WooHoo!
  • Gareth_Ainsworth
    Gareth_Ainsworth Posts: 34 Forumite
    Eighth Anniversary 10 Posts
    RobM99 said:
    £32 for water seems high, try a meter.
    That's got to be a meter. If you're not on a meter, you're on a fixed rate charge, and thats usually around £56 a month over 10 months.
★ ★ ★ Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 351.1K Banking & Borrowing
  • 253.1K Reduce Debt & Boost Income
  • 453.6K Spending & Discounts
  • 244.1K Work, Benefits & Business
  • 599K Mortgages, Homes & Bills
  • 177K Life & Family
  • 257.4K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.1K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.
Update Your Picture