Need help not slipping further into debt.

ryanm8655

Firstly, well done for having the co  ur age to confront this and post. You’ve had some terrible luck with the house and now COVID.

Hopefully post COVID your business picks up and you can starting fixing this situation quite quickly.

There has been some great advice in here. I understand you wanting to protect your boys and provide them with support for university but I think you have to accept that you’re unlikely to be in a position to do that. But will avoid getting preachy...there are other avenues of support they can access. All universities have hardship funds for example, there may be ASD charities that can provide support, and also you can have the student loan  reassessed.

With your situation you also need to cut down every non-essential item of spending. You’ve had some great advice here already but tv packages are not something you can afford right now. Personally I’d be cancelling Netflix and prime as well. There’s plenty of free tv to watch, plus YouTube etc. I think you’ve got to be realistic and a bit ruthless here. The boys aren’t/can’t contribute and you can’t afford it.

I assume you can’t access any of the government support for businesses?

Having cut to the barebones and essentials redo your SOA and let’s see how it looks.

You can do this. It seems a helpless situation to you but you need to use the skills and drive that has enabled you to have a successful business in order to work your way through this.

Once you’ve got yourself in a place where you can afford to live/know where you are on that front having cut the fat we can then think about how the debt will be tackled and your living situation improved. One step at a time...otherwise it’s going to be too overwhelming.

Happy_Sloth

Thank very much everyone for the suggestions, a few people asked some questions so i'll tray and go through each one with the answers and what i've done so far.  

Electricity/Gas ... i've rang the company, i have no idea why it keeps going up so high they couldn't explain it.  We pay the £200 a month and then every few months we end up with a massive surplus that we get them to refund.  They have agreed to set the direct debt to £100 there is a small surplus in the account atm (about £200) so i am going to leave that ready for when the bills go up in the  winter and for now i will log into the website monthly and make sure the £100 is covering it. 

Phones ... i've cancelled my work phone it was only on a sim only anyway i'll transfer it over to Pay as you go.  I've managed to change 3 of the 4 other phones.  Mine/Husbands where already sim only deals but i've changed to a smaller/cheaper plan.  My youngest sons phone was costing £40 a month, thats been switched onto a sim only as the contract had finished. That has taken my phones from £100 a month to £76. 

daisyfrau said:

With the ongoing business expenses you need to decide what to do about your business. What is your line of work? Is it likely to recover post-lockdown? Not a decision to make right now, but you do need to decide in the next few months as if it won’t recover you need to cut your losses.

In regards to my business... i know it's costing me money i can't afford, i had a frank conversation with my husband about it last night. He believes we need to have faith that it will recover, we may need accept it might take a while for the economy to recover and it's turnover to reach pre-covid levels.  He really doesn't want me to shut it down.  I don't want to shut it down but i'm still torn it is costing me alot of money i can't afford right now.  

I work in IT. I build computer systems, but it's a little more complicated than that. I help business take control of their data strategy.  So i go into business's that are having problems where their data systems and i work with them to assess what is causing the problem and helping them to fix it.  Sometimes this help is building them new systems, fixing ones that don't quite hit the mark. Sometimes it's helping them train staff or re-organise their departments and sometimes their business processes surrounding their data teams aren't giving the teams the support they need to be effective.  

The main problem at the moment is that most business's even ones that shouldn't be directly impacted my Covid are taking a 'wait and see'  stance... we saw a downturn in business at the beginning of the year because of Brexit and right now they arn't investing in my services because they just want to see how this covid situation pan's out or covid has directly impacted thier own profits and they simply can't afford it right now. 

I've been running the business for 3 year's i've never been short of work, my turnover has always been healthy and i'm normally busy.  I want to think that business will recover but i know it's likely to be slow... i think this tax year is likely to be a right off, i suspect most business's will wait till April next year before looking at the sort of projects i'm part of.  

sharpe106

On the business if you shut it down to cut the expenses now how easy would it be to restart it again? 

LordSomebody

Please don’t let yourself believe that your family would be better off without you. You did the right thing by coming here to talk about your situation. I also admire your resolve to protect your children from it, but please balance this resolve against the damage it must be doing to keep up appearances.

Nothing you’ve described here is insurmountable, and in future years you will look back on this and be glad to see the end of it - but also be glad to still be there to enjoy your next stages.

Please do speak to your GP if you still feel this way in another week or so.

kimwp

I didn't mention it in my previous message, so back to say - please know - the only thing your family would be better off without is the spend on unnecessary items while you need to save money and possibly the house.

What they would be better off with is you refocusing your fierce and admirable protective mama skills to help equip your boys for the future by guiding them in the outside world rather than protecting them from it and protecting your family's future financial position and home (because your spend points to a worrying downward trend even on your old income) by being straight with your core and extended family that you need to cut back for a bit. Your business has been hit by covid19 (which many businesses old and new, big and small have) and you've had a lot of unforseen spend on the house, it is entirely understandable that even someone very frugal would be struggling in that situation as well.

If you feel weighed down - go see your gp, that is what they are there for.

ryanm8655

kimwp said:

I didn't mention it in my previous message, so back to say - please know - the only thing your family would be better off without is the spend on unnecessary items while you need to save money and possibly the house.

What they would be better off with is you refocusing your fierce and admirable protective mama skills to help equip your boys for the future by guiding them in the outside world rather than protecting them from it and protecting your family's future financial position and home (because your spend points to a worrying downward trend even on your old income) by being straight with your core and extended family that you need to cut back for a bit. Your business has been hit by covid19 (which many businesses old and new, big and small have) and you've had a lot of unforseen spend on the house, it is entirely understandable that even someone very frugal would be struggling in that situation as well.

If you feel weighed down - go see your gp, that is what they are there for.

Spot on, it’s not a failure.

Thinking about your job. Given the move to working from home and how there is likely to be more of this going forward, can you sell your services as a solution to the network challenges around that? I know we’ve had to invest in IT infrastructure to handle the extra workload with everyone working from home. I do see your point about the economy tightening the purse strings of businesses though.

I do think the economy will recover quite quickly though. Most forecasts expect it to bounce back quickly once lockdown is lifted. Unlike the last recession, it’s not a massive correction of structural issues with the economy. It’s a temporary shock. And the economy hasn’t suffered as much as most analysts predicted. Of course, it’s had monumental impacts in the short term and I’m not trying to downplay those...

My main point is that things will pick up again for your business if it can survive. Your services will still be in demand but it might be some time before that demand picks up (likely 6-9 months). Without knowing the ins and outs, surely to some extent what you do is essential for large businesses, so may pick up sooner? I’m not sure. 

PurpleFairy26

Are you entitled to any government support for the SE? 

MrGorsky

I boosted my income temporarily pulling in a few thousand pounds over a few months doing the following:
Matched betting - this was surprisingly rewarding
Bank account switching bonuses
Ebay
Gumtree
It might be worth giving some if these a go.

Andyjflet

Lover_of_Lycra said:

Happy_Sloth said:

Lover_of_Lycra said:

I don't often say this but would you not be better off selling the house and moving into rented.  It sounds like an albatross around your neck and you don't even seem to enjoy living in it.  I know some people like the challenge of doing up dilapidated properties but yours still seems to need a lot of work and you don't have the money to do it.  Get rid and start afresh.

I intend to die in this house,  selling it would kill me.  Yes it's a burden and it's hard when i can't afford to pay the bills or pay for the work it needs, but i do love this house... it does make me happy.

i'm still hoping this financial blip is temporary,  it was caused by coronovirus, it can't last forever. 

i''ve never been out of work before and i've always earned a good living.  I'm clinging to hope when the market pick's up things will get better and i'll either return to my business or i'll at least find a job where my skillset is utilized.  Before Covid i earned a good living. Right now im doing a job that could have done blind folded 10 years ago.   

I'm doing it, because now is not the time for pride.   While i could sit on my butt and wait for a job that pay's what I normally earn, that might not happen for a while. So i've taken a temporary Job with a massive pay cut  ... because I have bills that need paying today and paying some of them is better than paying none on them.  I need to survive this storm so this job is simply what i need to do for now. 

Perhaps im naïve but i have to believe i can keep this house... because despite it's issues i wake up in my bedroom every morning feeling blessed and losing it would literally kill me... We are in this mess because i wanted to set up my own business and my business was very profitable for 4 years, it fell apart because of Covid. If we lose this house because of decisions I've made then honestly my family would be better off without me.

I need to get us through this somehow..... I got us into this mess i need to get us out of it. 

It’s easy to blame covid for the situation but the reality is that you were already walking a
financial tightrope before covid came along. 

You won’t sell the house. You can’t afford to meet your repayments. You can’t afford to subsidise your sons at university but apparently they can’t get jobs. How do you see yourselves resolving this situation? 

Agree with this I'm afraid, whilst I sort of admire your stiff upper lip approach, in reality lots of businesses have been affected by Covid, but we've been getting on with it, I have / had, a high level job on a large salary but now I'm delivering for Amazon, but I don't remind myself of it every day, I'm no better than anyone else. Clinging on to the past is just going to drive you into debt.
Your business is in trouble, you're living beyond your means and you cant afford it.
I fear that until you acknowledge these things and start changing your mindset this isnt really your wake up call yet. Sorry. 

jennifermerkle

Happy_Sloth said:

3 years ago I have a good job and income and bought the house of my deams... it's perhaps not everyones cup of tea it was a very rundown edwardian townhouse that had seen better days.  When we bought it we knew it needed work and we got it at a bargain price because of the amount of work it needed,  it's a big house and we knew renovations would be expensive but there was no-way we could afford a house like this if the work had already been done.  When we moved in we thought most of the renovations would be cosmetic and we didn't mind the idea of living on a building site because we knew we would do the jobs as we could afford it. 

Over the past couple of years we have invested every penny we've earned into making the house livable but many of the renovations where urgent and none cosmetic. We remained debt free until august last year,  when 3 disasters hit.  1) The roof started leaking badly and needed to be entirely replaced as the whole roof was rotten.  2) the boiler died and when we had a fitter come and replace it, he wrote off our electrics.. when i say this i mean he turned them off and told us the electric's in the house where no-where near safe or compliant.   3) we came home one day to find a large portion of the gable wall was no-longer attached to the house and it was raining in the hall. 

Because none of these jobs could wait we have to get a unsecured loan of around £20,000 ... because we where idiots we underestimated how much we would need and put another £15,000 on credit cards.   At the time I wasn't worried, we had a good income and the re-payments where manageable.  

There is still work to do on the house thats deemed to be important, but honestly we can't even think about that now.. for example none of the upstairs water works, we have no flushable toilets, shower or working bath.  Because they are all filled from a header tank that doens't fill,  we use buckets going up and down 3 floors to manually fill it.  The shower is a no-go area as even when the header tank is filled the drip tray leaks into the kitchen.  So at present we have 4 adults who are restricted to taking a bath, but filling the tank enough for a bath takes 40 minutes of going up and down stairs with buckets. 

in the last 6 months our income has nose dived.. I'm a small business owner barely clinging on to my business and my husband is furloughed in a job that is more likely to go redundant than see him back at work.  The bills on our house are high,  because it's a big house in a nice area,  we've cut back on everything we realistically can.   

I honestly don't know what to do at this point,  our income has dropped by about £50,000 a year and this house was not made to run on our current income and with the debt we got into last year we are barely keeping our head above water.   I've just started a temporary job to try and help pay some of the bills but with my new wages and my husbands furlough we don't even cover the essentials and the mortgage break is due to end at the end of june.  

I just don't know what to do. 

Have you thought about renting your house capacity. If you try to find a tenant and take some rent in advance you could probably get the immediate issues fixed so that you can some income on rent. Your husband could look at taking up some side gigs until he finds another proper job maybe? Also, check every single outgoing and see is there anything you can save up?