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So here goes - this is bad but I need to so something about it
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Hiya! If your SOA is correct, then it's simple - pay the excess towards the debt with the highest Apr. Once that's paid off, pay the excess towards the next highest Apr debt. Making savings on your expenses as suggested by posters above will speed up this process.
If any of the benefits are child support then I think you will have to pay this back, given your income, so it's best not to include it in your SOA.Statement of Affairs (SOA) link: https://www.lemonfool.co.uk/financecalculators/soa.phpFor free, non-judgemental debt advice, try: Stepchange or National Debtline. Beware fee charging companies with similar names.0 -
jondebtz said:Hello,.
Bit nervous about this but it's time to sort it out. We have big debts and have been getting our heads around our current situation.The debt built up over many years. We funded several rounds of IVF, our wedding, house renovations etc and now we are at the stage where we have to deal with it. Thankfully we have a good enough income to get out of the hole we are in.....I think!
Here is our current SOA.Household Information[/b]Number of adults in household........... 2Number of children in household......... 1Number of cars owned.................... 2[b]Monthly Income Details[/b]Monthly income after tax................ 4093Partners monthly income after tax....... 1460Benefits................................ 515Other income............................ 400[b]Total monthly income.................... 6468[/b][b]Monthly Expense Details[/b]Mortgage................................ 520Secured/HP loan repayments.............. 0Rent.................................... 0Management charge (leasehold property).. 0Council tax............................. 106Electricity............................. 100Gas..................................... 186Oil..................................... 0Water rates............................. 32Telephone (land line)................... 12Mobile phone............................ 80TV Licence.............................. 12Satellite/Cable TV...................... 59Internet Services....................... 0Groceries etc. ......................... 500Clothing................................ 50Petrol/diesel........................... 300Road tax................................ 5Car Insurance........................... 58Car maintenance (including MOT)......... 0Car parking............................. 0Other travel............................ 0Childcare/nursery....................... 100Other child related expenses............ 0Medical (prescriptions, dentist etc).... 10Pet insurance/vet bills................. 36Buildings insurance..................... 10Contents insurance...................... 9Life assurance ......................... 33Other insurance......................... 0Presents (birthday, christmas etc)...... 100Haircuts................................ 20Entertainment........................... 200Holiday................................. 0Emergency fund.......................... 100[b]Total monthly expenses.................. 2638[/b][b]Assets[/b]Cash.................................... 2000House value (Gross)..................... 250000Shares and bonds........................ 0Car(s).................................. 8000Other assets............................ 0[b]Total Assets............................ 260000[/b][b]Secured & HP Debts[/b]Description....................Debt......Monthly...APRMortgage...................... 47000....(520)......1.8[b]Total secured & HP debts...... 47000.....-.........- [/b][b]Unsecured Debts[/b]Description....................Debt......Monthly...APRUpdraft consolidation..........28000.....630.......0Barclayard 1...................12800.....234.......6.9Barclaycard 2..................4800......108.......6.9Parents........................5000......0.........0 - no pressure on this oneDrafty.........................1300......167.......0 - horrendous - something like 188%aprTesco CC.......................3500......35........0Creation card..................4000......40........0MBNA...........................10400.....325.......19.9Halifax loan...................6800......132.......6.9[b]Total unsecured debts..........76600.....1671......- [/b][b]Monthly Budget Summary[/b]Total monthly income.................... 6,468Expenses (including HP & secured debts). 2,638Available for debt repayments........... 3,830Monthly UNsecured debt repayments....... 1,671[b]Amount left after debt repayments....... 2,159[/b][b]Personal Balance Sheet Summary[/b]Total assets (things you own)........... 260,000Total HP & Secured debt................. -47,000Total Unsecured debt.................... -76,600[b]Net Assets.............................. 136,400[/b]
Please be gentle. I am deeply ashamed. We have more debt than anyone I have ever knownThat consolidation loan from Updraft indicates this debt has occurred over a number of years. For future reference never consolidate debt. It kicks the can down the road so you would be dealing with in your case over £76k of debt rather than £20k. As you have a decent income no doubt you have continued to spend rather than rein in a few years back. Dealing with it now is priority.Are you sure your parents are not wanting their £5k back soon?Do you have an overdraft?
If you are actually now in a position to address it get that Drafty loan paid off. It is sub prime debt so is damaging your credit record. Check out that Updraft consolidation loan too as I am sure that is not 0%. I would actually use that £2k cash to pay off Drafty today.
Have you defaults or late payments affecting your ability to get 0% deals?
You should have £3800 available monthly to repay the debt. If that is accurate I would tackle the Drafty loan first then Updraft and MBNA and double check the expiry date of any 0% deals on the cards. Repay the debt by tackling the highest interest rate debts first.I’m a Forum Ambassador and I support the Forum Team on the Debt free Wannabe, Budgeting and Banking and Savings and Investment boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.
The 365 Day 1p Challenge 2025 #1 £667.95/£72.60
Save £12k in 2025 #1 £12000/£40001 -
I would definitely check the rate on that Updraft consolidation loan as there is some debate as to whether it is a payday loan lender. The representative rate on the website shows as 17.9% but a quick Google indicates that most are paying way above that.I’m a Forum Ambassador and I support the Forum Team on the Debt free Wannabe, Budgeting and Banking and Savings and Investment boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.
The 365 Day 1p Challenge 2025 #1 £667.95/£72.60
Save £12k in 2025 #1 £12000/£40001 -
Good info on the Updraft loan - definitely one to check out OP as it may be that it's one to target ahead of where you think it might sit.
I'll echo the calls not to consolidate further - it doesn't work, you already know that, and you are in too good a position to risk blowing things now by kicking the can down the road. Right now I sense a proper sense of urgency from you to tackle things - so make the most of that and get the plan in place.
Once you've started making headway and got some stability in the budget, it "might" be that you can consider exchanging some of the debts for lower interest rates - either by balance transfers, or perhaps by taking a lower rate loan as suggested earlier in the thread. Right now though that would be poor advice in your circumstances - as you don't yet have an "actual, factual and functional" budget in place, nor have you had a taste of the work the decision making process in clearing down debt - both those things are vital before you look at any potential short cutting of the process.🎉 MORTGAGE FREE (First time!) 30/09/2016 🎉 And now we go again…New mortgage taken 01/09/23 🏡
Balance as at 01/09/23 = £115,000.00 Balance as at 31/12/23 = £112,000.00
Balance as at 31/08/24 = £105,400.00 Balance as at 31/12/24 = £102,500.00
£100k barrier broken 1/4/25SOA CALCULATOR (for DFW newbies): SOA Calculatorshe/her0 -
Thanks for everyones replies - much appreciated. I do appreciate that we in a position to sort this without a DMP etc, however we need to do it now.
Our income has increased quite a bit in the last 3 months so we are still getting to grips with it. The reality is that we have been so wasteful with money. Last night I downloaded my HSBC transactions from January - I deleted all of the essential spends and then calculated the sum of the things that were unnecessary - £1222. Totally disgusted by that, however that is something that I can fix easily.0 -
jondebtz said:Thanks for everyones replies - much appreciated. I do appreciate that we in a position to sort this without a DMP etc, however we need to do it now.
Our income has increased quite a bit in the last 3 months so we are still getting to grips with it. The reality is that we have been so wasteful with money. Last night I downloaded my HSBC transactions from January - I deleted all of the essential spends and then calculated the sum of the things that were unnecessary - £1222. Totally disgusted by that, however that is something that I can fix easily.
You may find opening a diary in the diary section will help both in keeping you accountable and providing support and tips from others going through the same journey.Statement of Affairs (SOA) link: https://www.lemonfool.co.uk/financecalculators/soa.phpFor free, non-judgemental debt advice, try: Stepchange or National Debtline. Beware fee charging companies with similar names.2 -
It's such an easy win.
True story - when we first landed here, it was mainly because a friend had signposted us here as a good place for information on overpaying the mortgage. If you'd asked me at the time I'd have said that we weren't in debt - but in fact there were rolling CC balances, a bank loan for a car which had just been taken, and we were generally in our overdraft facility by the end of each month. when we went through things we realised that we'd slipped into the trap of frittering - and there was just no need for most of it. Late back from work on a mid week day? Well it wasn't like we had any meals planned, so a quick stop at the takeaway was easier than stopping at the shop, buying something and cooking it back at home. Fridays were ALWAYS takeaway days because we "deserved it" after a long week at work. At a loose end on a Saturday? One of the big shopping centres hereabouts was a natural option - a bit of a browse, buy some stuff we didn't really need, have lunch or at least a coffee and a cake...
Our income at that stage was nothing like where you're at - but then costs were also a fair bit lower then - this was pre the 2008 financial crisis, albeit only just. Fast forward to the time of that crisis and the loan was pretty much gone and we were beginning to turn our attention to the mortgage. We were no longer using overdrafts and the CCs were down to being cleared (enter the Martin-voice) IN FULL each month, we were budgeting properly, having a takeaway once a month and not frittering, and we'd tackled haggling down bills that had crept up to silly levels too (I can clearly recall a £70+ monthly TV/Phone/BB bill - a large amount 15 years ago!) - each time we made a saving on a monthly expenditure we added the money to a standing order which went into our "mortgage OP pot" and got paid off the mortgage in chunks each time we hit a few hundred pounds in there. And each time we made a conscious decision not to spend on a "fritter" we stuck the cash in a piggy bank at home - and that then got added to that pot periodically, too.
The loan was cleared in 13 months, not the 30 it was taken out for, and the mortgage was cleared early too, in 2016 - we'd still be paying it off now if we hadn't decided to take things in hand. Ironically the work we had done by the time Northern Rock went pop was enough to ensure that we were also one of a tiny number of mortgage accounts that was hived off to the "good bank" side - so we escaped ending up with NRAM - and we all now know what a stroke of good fortune that was!
The reason for this ramble? To show you that it can be done - and that you can get yourself into a position inside a few years where rather than having debt, you have savings. Look at it this way - if you can get yourself to a debt free position, you will have (on your current budget figures) around £3500 a month "spare" - or, for context - forty two thousand pounds a year - and that is quite realistically in reach for you. It's something that most people could never even dream of - so take the focus you currently have, run with it, and create that reality for yourself and your family.
🎉 MORTGAGE FREE (First time!) 30/09/2016 🎉 And now we go again…New mortgage taken 01/09/23 🏡
Balance as at 01/09/23 = £115,000.00 Balance as at 31/12/23 = £112,000.00
Balance as at 31/08/24 = £105,400.00 Balance as at 31/12/24 = £102,500.00
£100k barrier broken 1/4/25SOA CALCULATOR (for DFW newbies): SOA Calculatorshe/her11 -
It's definitely the frittering that has destroyed our ability to budget properly @EssexHebridean - so many of the things that you have mentioned are things that we do/have done - take aways, days out shopping with lunch etc - all without any real regard as to whether we could actually afford it or not!
I have just turned 42 and I so wish that I had sorted this out earlier.4 -
jondebtz said:
I have just turned 42 and I so wish that I had sorted this out earlier.My Debt free diary
https://forums.moneysavingexpert.com/discussion/6492297/10-000-steps-1-step-at-a-time3 -
jondebtz said:I have just turned 42 and I so wish that I had sorted this out earlier.Debt Free as of 17/01/2009 Turtle Power!!
EF Challenger #3 £1543.72 / £5000
MFW 2024 #100 £1300.00 / £10,000
MFiT #40 Jan 2025 Target - £99,999.00
Mortgage at 30/09/22 £113,694.11 | Mortgage at 24/01/23 £110,707.87
Mortgage at 21/04/23 £107,701.01 | Mortgage at 20/07/23 £106,979.65
Mortgage at 04/10/23 £106,253.77 | Mortgage at 10/01/24 £105,324.57
Mortgage at 01/04/24 £104,424.73 | Mortgage at 01/10/24 £103,594.981
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