Debt options

StupidFool89

Sorry my mistake that should been 13 per month

Naomim

Your gas and electricity also look a bit high. Are you repaying debt here or is it worth you checking to see if you can get a better deal anywhere else?

Also haircuts. Is that something that can be cut back on? We're a family of 4 and I put £50 a month by.  MrM, DS & DD have a cut about every 6-8 weeks and me every 3 months or so. I dye my hair at home. Two of you should be able to possible reduce that by about £20 at least.

fatbelly

StupidFool89 said:

I’ve stupidly ran up a large debt on 2 credit cards as well as a loan and need to decide whether a DMP or a secured loan is the better option? Any advice on which is the better choice in both the short and long term?

Definitely a DMP every time. Don't put your house at risk.

I think the choice here is
debt juggling and budgeting
or
DMP

debt juggling and budgeting is just about doable but the cars worry me - and I don't think you've allowed enough maintenance for 2 of them.

I also  suspect you will spend more than £125 on food for two of you but the false tv licence figure sort of balances that.

There may be potential to get the cards( or at least some of that balance) on to 0%. 

Is the council tax being paid over 12 months?

The easier of the two options is a DMP

RAS

Your food bill looks incredibly low?

Any way either you or your partner can increase their wage?

And it may be worth going round the house and seeing if there is anything you can sell off. You really need an emergency fund, £500 would be a start to cover breakdowns because buying on credit will be difficult.

You may be better off with a DMP, in which case you definitely need an emergency fund.

StupidFool89

Naomim said:

Your gas and electricity also look a bit high. Are you repaying debt here or is it worth you checking to see if you can get a better deal anywhere else?

Also haircuts. Is that something that can be cut back on? We're a family of 4 and I put £50 a month by.  MrM, DS & DD have a cut about every 6-8 weeks and me every 3 months or so. I dye my hair at home. Two of you should be able to possible reduce that by about £20 at least.

I’ve managed to reduce gas/electricity by £30 in the last month. I’m trying to repay the debt as in the long term it is the better option.

That is an approx for the haircuts and some months can be up to £15 lower depending when we go as I go about every 6 weeks

ryanm8655

Gas and electric seem high, I’d change supplier. And use a cash back site if it works out cheaper (even using a comparison site via Quidco or similar gets you a bit of cash back) every little helps. Cancel the tv as well. Phones aren’t too bad for 2 people but I’ll be moving onto an £8 sim only deal when my contract expires so you can save there too. Haircuts seems high as well, stretch those out a bit more.

Food seems low (though tv license obviously too high) as does vehicle maintenance but assume they’re quite new?

Can your partner get a 2nd job, do more hours or get a higher paying role? 

It’s going to be a real slog either way. I’d be tempted by a DMP in your shoes but I’d do some calculations to figure out your debt free date if you do it by making realistic cutbacks.

Is this an aspirational SOA or actual? As it shows a small surplus once you account for tv license.

StupidFool89

RAS said:

Your food bill looks incredibly low?

Any way either you or your partner can increase their wage?

And it may be worth going round the house and seeing if there is anything you can sell off. You really need an emergency fund, £500 would be a start to cover breakdowns because buying on credit will be difficult.

You may be better off with a DMP, in which case you definitely need an emergency fund.

My wages are ok could always be better but the rates of pay locally are fairly poor. The wife has a medical condition which limits her hours she can work as she can get ill easily (Casing point was that we went to NY 2 years ago she was ill while there and her medical bill exceeded £28k, which was covered by insurance fortunately).

As I mentioned in a previous reply the the council tax is paid over 10 instead of 12 months so will use some of this to create a fund.

TheAble

4k's worth of cars but 12.5k of car PCP debt, how did that happen? Did you just get really behind on your payments or something?

BabyStepper

First thing, change your username. You're not stupid, or a fool, you're ordinary. We've all been there, done it and learned the hard way. You can learn too. 

Second, if you take all the good advice already given about council tax over 12 months, cutting cable telly, reduce mobile phones to sim only, fewer haircuts etc you can free up a good chunk to overpay debt. Also (and this will not be popular but it worked for us, as long as it's time limited) you could cut the pension payment for a year and use that too. That'd give you £400 per month to throw at debt, starting with the Bank of Scotland cc. 

Then you wait until the 0% offers become available and move your cards to interest free, and it all starts moving much faster. 

Also you can't afford 2 cars, end of story. As has been said, you don't have enough in your maintenance budget for 2. Sell one. If OH uses it to get to work then you need to find another way.  

In your shoes, I'd give myself 6 months to see if I could make this work. If it's too hard and we just weren't managing, then do a dmp. But I'm all for giving it a go first. 

Do you have anything to sell? Any other way of bringing in more income? You could do surveys, grocery challenges, all kinds of things. 

Good luck, and come back and tell us what you decide. 

  

fatbelly

So your council tax is £145 over 10 months. That should leave you with 145 to pay for 20/21, assuming the December payment goes out.

If you contact the council they should allow you to spread that over Jan, Feb and March, so £50 per month to the council and £100 per month to an emergency fund.

Then take the option (should be on next year's bill) to pay by 12 instalments on the 20th of the month

I quite like this as an energy comparison tool.

https://energycompare.citizensadvice.org.uk/

Check on the referrers board to see if there are any referral links for your chosen supplier. There are often links for Bulb, Octopus, Igloo, So, Shell