Hiding debts from family, partner & spiralling - time for change!

rondog97

I am hiding my debt and my money struggles from my family and boyfriend and while I don't have the courage to tell them right now what's going on, I hope this debt-free diary will help stop the spiralling and keep me focused on the plan!

I've never been 'good with money'. My parents remind me of a holiday we went on when we were kids, they'd give me and my sister 5 euros each to spend each day and by the end of the second day, I'd have spent all of my cash on Pringles and I'd be 3 euros in debt to my sister. This is basically how I've lived the last 25 years!
I had a job from 16 working in a supermarket and at 18, I went to Uni and slowly started to struggle even more with overspending and not living within my means, which led to getting a £1500 overdraft. I lived in that until March last year where I very fortunately received a lump sum of money from my Mum that she'd put away over the years for me in a building society account. I said I wanted to use it to open my LISA to start saving for a deposit, when really it went on clearing my overdraft. I really hate lying.

I managed 3 months without debt which made me feel GREAT. I thought "yeah, I've nailed this money thing!", so in June last year I got myself a Barclaycard to 'improve my credit rating' ahead of planning to move out with my partner. Despite convincing myself that I'd keep it under control and 'only use it for topping up my oyster'; it slowly became my main payment method. The amount on my credit card has been slowly building and I found myself needing to use it for petrol, travel and groceries. I find myself constantly paying more and more of my salary to debt and not being able to tell anyone makes it incredibly overwhelming and lonely, yet I cannot bear to tell anyone and I'm trying to act like I'm not in debt. My most recent mistake was I impulsively spent £450 on my card on some gig tickets, dinner and drinks and today, my car failed its MOT, needing between £600 - £800 worth of works. I have a family holiday coming up in April and another one at the end of May, both of which I still need to pay for, plus I have the constant pressure and questions around moving out with my partner, who has no idea what's going on either. I am more scared than anything of being found out and everyone being ashamed of me, although it's becoming harder and harder to hide what's really going on, as my parents are beginning to ask me more about my savings and future and are wanting to do lots of nice things together that I just can't afford. I really, REALLY, hate lying.

Here's where we are
Barclaycard 0% until June 2024 - £1845 (£200 a month for March, April, £300 a month from April onwards)
Mum loan for flights - £250 (£125 a month in March and April)
Mum loan for car TBC - £600 - £800

On a positive note, despite getting myself into debt, I've got £1700 in my LISA. Part of me wonders whether I should withdraw this (25% fee though, ouch), pay off a chunk of my credit card debt and focus all my efforts on paying that off. Or perhaps I keep my LISA money where it is, stop putting money into it, and spend the next 8 months paying of the CC with the money that was going in the LISA. I was thinking of speaking to someone from the Christians Against Poverty team to help me figure some of this out as I'm really unsure how to tackle. Any suggestions welcome!  

Either way I'm glad that my story is out there now as I know I'm not alone in these forums and I'm now tackling my debt head on.

xx

redlaces

Hey! Well done for coming here - this is the first step to getting sorted and you will get some great advice from the amazing people who spend time here.

First off I think it's important to forgive yourself - yes you might have messed up in the past, but so has almost everyone else here, myself included. And the good news is you've caught it at a point where it's still pretty manageable.

So, two things:
-   Firstly, well done for tallying up what you owe and to whom. That's the motivating step. To get a clear picture of how to get out of it, you need to understand you got here, which means taking full inventory of where your money has been going. So to do that, you'll need to fill in an SOA with the actual figures you've been spending on all your outgoings for the last few months. Here's the link: https://www.lemonfool.co.uk/financecalculators/soa.php Format for MSE and then post it back up here.
-   I get that you don't want to share the inner details of your financial woes with your nearest and dearest. However, to make any progress, it may become clear, once you've done the SOA, that you need to cut back in order to make inroads into the debt. This doesn't have to be a "bare-all" situation, but it does help if everyone around you knows you are having a lean few months in order to meet some goals, so they can support you and not be upset if you need to say no to some things. How you go about it is up to you, but a problem shared is a problem halved, and all that. And if they know you are on a budget, they may suggest alternative plans to spendy stuff like holidays.

As for the LISA I would be tempted to leave that where it is, I did the same during my debt journey and it was motivating to come out with a couple of grand ready-saved at the end of it. However, others may disagree. A lot of it depends on what slack you have in your budget, your debts are small so should be easy to knock out in a few months with some careful budgeting and flexing of the discipline muscles.

Good luck - you'll get there!

redlaces

Forgot to add also - stop spending on the credit card. It's important to try and get that to a static balance that you can chip away at, treat it like your loans - a debt to be paid down over time - and only use the money you have in your account. That's when my debt journey started to pick up speed and the lightbulb finally came on.

enthusiasticsaver

I think first of all you need to do an soa and go through your bank statements to see where your money is going.  Obviously some is going on debt repayment but then you are still spending on credit so not moving further forward.  I think you need to go cold turkey and not use the cards until you have your finances under control. Otherwise it is one step forward and two steps back.  

Once you have worked out your soa  SOA Calculator (lemonfool.co.uk) make a plan to hopefully repay the cards within the 0% period but don't overstretch and put more money back on the card.  I think you need to be honest and say to people you cannot afford things as you are saving for a deposit (not a lie just a white one really).  Don't withdraw from the Lisa.  Whether you continue to put money in depends on whether you can repay that Barclaycard in the deal period.  In the meantime no overdrafts or credit card spending.