Support and advice for dealing with a massive debt without going under!

PalindromeAlone

Thank you! I will relook at my SOA and some best/worst and static case scenarios too. Though i've not had my hair cut since the day before no. 3 was born 2 and a half years ago and the kids have had home trims along with OH. We've probably spent nothing on our hair this last 12 months!

I think my current plan for getting a bit more stable is to try and bring extra money in every month if at all possible until the end of the year in order to pay the bills. Today I have put a box of our old books together for Ziffit which will be £20 all being well. I have started doing surveys which have given me just over £1 so far today. 

I will call my credit card companies this week as well and see if anyone will reduce their interest rates for 12 months. If I can shave even £50 a month off min payments it will be a good result. 

I also need to get the ball rolling for child benefit for no.3. Having looked online I think I should be able to back date for 3 months too which would give a small extra chunk of cash to put on debts. 

I have also been thinking about goals and have come up with this list for the end of 2021.

1. To have debt repayments under £1000 a month.
2. To be able to go back to work full time and contribute to a pension
3. To have an emergency fund of a min of £500
4. To make sure that anything extra I earn is either taxed correctly or not subject to tax. So far it all seems a little grey.
5. To have some me time every week. 

So not entirely debt based but I feel may be achievable if I am focused.

If you have any thoughts on the above please send them on. I appreciate all your comments and suggestions and if I don't take them up straight away I am definitely keeping them in mind for when I feel able to take a few more baby steps. 
  

kimwp

This should help with point 4:

https://www.litrg.org.uk/tax-guides/self-employment/what-trading-allowance

There's also a property related allowance of £1000 I think, which goes up to £7000 for rent a room.

PalindromeAlone

Thank you! I have had quick read and will go though in more depth when I have a moment. Oh how I wish we had a room to rent, it would make things much easier! 

Having read through my recent posts there is quite a lot of a stream of consciousness going on - apologies. I think I have so many thoughts needing to come out that they are zooming all over the place now they have an outlet. I shall try to make sure I keep things a bit more concise and organised going forward.

Suseka97

Firstly, I'd just like to say that I think what you are trying to do is admirable and congratulate you for taking control of your financial predicament.  I really do empathise with the situation you find yourself in and although I understand you don't feel able to speak to your husband right now, I do hope you will do so at some point because it really will help you both get yourselves on track with your finances going forward.

I would add here that my husband hid his debt from me for quite a few years and it continue to grow until 'he' came to breaking point and it all came out.  Had he done so sooner we could have worked together to resolve things and whilst we would still have had a debt issue to resolve, it would have been much less.  I realise your situation differs, but the similarity is that my husband felt he couldn't talk to me about it and that made me feel terrible, when he finally admitted how bad things were.  The debt was a side issue to me (although, to be fair I was shocked at the amount at the time) but what lingered was a sadness that he was carrying all that worry alone, while I was just carrying on with my life - spending money we really couldn't afford, in complete ignorance (BTW, we had separate bank accounts, so his debt was easy to hide).

Now, as to your plan - it's clear you've given this a lot of thought and I hope things work out for you.  You know all too well how close you are 'sailing to the wind' and so it wouldn't take much to throw you off course.  You do need to add an emergency fund into your SOA, to get a truer picture of the money left available to service your debts.  An emergency fund is going to be essential going forward.  If it were me, given that your husband intends to take some time out of the workplace and you have no idea how long it may take for him to return to work, you should set aside the whole £6k to cover costs across the months and put the remainder into an emergency fund as and when he finds work.  

If your finances allow, you could also look into 'snowballing' which is where you put together a plan to pay off debts with the higher interest rates, by overpaying them one by one, whilst reducing all the others down to the minimums.  I realise that might not be possible given the amounts involved, but it is an effective method and something else to consider.

You may find that a DMP or something of that nature is where you are heading if your plan doesn't quite work out the way you hope; it's worth reading up on that so you know what's involved and it's a debt solution that doesn't put your house at risk.  

Good luck.

the_final_girl

I'm in a similar situation to you Palindrome, in that my other half lost his job in February and has taken some time off so no income coming in since then. He's been living off his savings.
But the situation is a bit different I guess as our finances are separate. We go halves on the mortgage and on utility/pet/insurance bills but everything else is kept separate. Separate accounts, separate debts.
I've managed to amass around 40k of debt through poor spending choices but I'm trying to tackle it alone.
He does know what I owe though.
I don't feel I could ask him to help with my debts although I've been worried since he's been out of work. But as long as he can pay his share of the bills it's not affecting me....so far!  I guess the problem comes when he runs out of money but doesn't have any coming in.
But I get why you don't want to tell your husband. Mine only knows the amount because I got drunk one night and told him! I think the worry about what happens at the end of the year with his job must be quite difficult though.
Could you maybe tell him that you're in debt (perhaps not the amount) and that it's a fine line - you wouldn't be able to manage without some income coming in from him so he does need to think ahead?

PalindromeAlone

the_final_girl said:

I'm in a similar situation to you Palindrome, in that my other half lost his job in February and has taken some time off so no income coming in since then. He's been living off his savings.
But the situation is a bit different I guess as our finances are separate. We go halves on the mortgage and on utility/pet/insurance bills but everything else is kept separate. Separate accounts, separate debts.
I've managed to amass around 40k of debt through poor spending choices but I'm trying to tackle it alone.
He does know what I owe though.
I don't feel I could ask him to help with my debts although I've been worried since he's been out of work. But as long as he can pay his share of the bills it's not affecting me....so far!  I guess the problem comes when he runs out of money but doesn't have any coming in.
But I get why you don't want to tell your husband. Mine only knows the amount because I got drunk one night and told him! I think the worry about what happens at the end of the year with his job must be quite difficult though.
Could you maybe tell him that you're in debt (perhaps not the amount) and that it's a fine line - you wouldn't be able to manage without some income coming in from him so he does need to think ahead?

Hi, thanks so much for this. I guess the debt on my cards is similar to your level of debt with his being the final part. That said I have spent on my cards to keep us going and in many ways to keep the peace as OH hates money talk. We do have separate accounts still and always have done but I have been responsible for all the finances and making sure bills get paid etc and any planning. Thing is that often I have planned for something - like unpaid time at the end of my maternity leave but OH doesn't plan and kind of assumes I have it all in hand - buying extra presents, paying for the car, him changing hours etc and often I don't have much notice for things so have ended up putting them on cards. 

I still have a lot of thoughts in my head about the best way forward but I am thinking at the moment that I just need to take the next 6 months one at a time and focus on getting to the end of each one without using my cards or defaulting. This is going to be a long old road but I am starting to feel a little bit more positive about some elements. I've been reading diaries and looking at what people have done to bring in a bit extra here and there. The main thing I really need right now is to get my minimum payments back to a more affordable level. If I can get those into a more reasonable place then I can really begin thinking about how best to bring the overall debt down as fast as possible. 

I am making sure I am up to date on DMPs, consequences of defaults, who is best to speak to about money etc so that if I need to move forward with any of these options I can do so quickly. I'm really hoping I can keep it from getting to this but at the moment the line is so thin it could easily go the wrong way if I take my eye off the ball!