From broke to better ..a journey

lillypoo

Hi everyone.

Well today is, as they say, the first day of the rest of my life. The first real day of my journey to get rid of debt. 

I am alone in this. No partner and no family for support so I am finding myself tearful and scared. I know noone here can hold my hand, but I've seen so much support on other people's diaries and got so much encouragement and hope from others recovery from that LBM onwards , that I do believe that I can cope and do this. 

Doing this diary will hopefully keep me accountable and be a bit therapeutic.

So my story. I will keep it a bit vague as I'm so afraid someone will recognise me lol. I am hoping that the shame I currently feel will eventually turn into pride that I took action.

I used to have a fab job which paid well. But it came with a bonkers social life and peer pressure to have what the in crowd had. So ...I spent a lot more than I had. I then met a guy and fell in love. He had literally not a penny to his name so for almost 20 years I supported him only to find he had no feelings for me at all and when I needed emotional support he did a runner.
Next my aged parent got very sick. He had never moved house from the day he was born and his biggest fear was a care home. My sibling was useless and my employer was unsupportive so I resigned ... took early retirement and cared for him full time for two years till he passed away. All this time being told that his will took good care of me and recognised what I'd given up.

In fact my sibling got more than me. But when we sold the house I managed to purchase my own small home with no mortgage. So that's one thing. I own it outright. But it has cost me so much more than I expected in repairs. Not cosmetic stuff. Actual modernisation and essential maintenance.

And still I carried on treating myself to stuff I couldn't afford to cheer myself up!

So now I'm totally out of my depth. I'll do a SOA later on the main forum but basically I owe 2500 on an arranged over draft, 10000 on cc1, 11000 on cc2, 750 on cc3.
I also have a car on pcp which I currently owe £8000 on but once I have enough to purchase a cheap little run around in its place I will get rid of that.

I get my work pension and have taken on a part time job but interest and charges now mean that I can hardly make minimum payments. I make them but then have to use the cards later in the month to live on so its a viscious circle.

I've had persistent debt letter from the two card issuers.
 
I am aiming to be debt free before I get my state pension which is 5.5 years away.

I live alone rurally with my dogs. I have a ton of books I've never read , loads of yarn I've stashed and loads of knitting projects I've never finished so I intend to work my way through the books then sell them and use up all that yarn on projects to keep me occupied.


Thats it for now. I just needed to make this first entry before I chickened out. 

Work today so I'll do the SOA later 

I have set up my new basic account and changed where my pay and pension will go into from the end of May onwards  ... snd during May I will be cancelling DDs as they're paid snd moving essential ones to the new account 

I'm having to do one step at a time to not feel totally overwhelmed 

Thank you to anyone who has read this far. 

X

lillypoo

Oh and I've done the online bits with step change but not spoken to them yet. They said the budget I've set myself is realistic for one person and didn't recommend changes. Personally I find it much more  generous than I expected but I think its more sustainable than if I was scrimping more. 

The dmp looks like I would be debt free in 4 years depending on how long it takes to get the defaults and begin in earnest. 

lillypoo

Posting this here incomplete ..banking app is down so can't access Apr right this sec

[font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]

Household Information[/b]

Number of adults in household........... 1

Number of children in household......... 0

Number of cars owned.................... 1[b]

Monthly Income Details[/b]

Monthly income after tax................ 1889

Partners monthly income after tax....... 0

Benefits................................ 0

Other income............................ 0[b]

Total monthly income.................... 1889[/b][b]

Monthly Expense Details[/b]

Mortgage................................ 0

Secured/HP loan repayments.............. 250

Rent.................................... 0

Management charge (leasehold property).. 0

Council tax............................. 99

Electricity............................. 85

Gas..................................... 0

Oil..................................... 0

Water rates............................. 29.5

Telephone (land line)................... 43

Mobile phone............................ 68

TV Licence.............................. 25.6

Satellite/Cable TV...................... 0

Internet Services....................... 0

Groceries etc. ......................... 250

Clothing................................ 30

Petrol/diesel........................... 90

Road tax................................ 14.45

Car Insurance........................... 26

Car maintenance (including MOT)......... 30

Car parking............................. 0

Other travel............................ 0

Childcare/nursery....................... 0

Other child related expenses............ 0

Medical (prescriptions, dentist etc).... 15

Pet insurance/vet bills................. 50

Buildings insurance..................... 15

Contents insurance...................... 0

Life assurance ......................... 0

Other insurance......................... 0

Presents (birthday, christmas etc)...... 30

Haircuts................................ 10

Entertainment........................... 50

Holiday................................. 20

Emergency fund.......................... 30[b]

Total monthly expenses.................. 1260.55[/b]

[b]

Assets[/b]

Cash.................................... 0

House value (Gross)..................... 140000

Shares and bonds........................ 0

Car(s).................................. 0

Other assets............................ 0[b]

Total Assets............................ 140000[/b]

[b]

Secured & HP Debts[/b]

Description....................Debt......Monthly...APR

Mortgage...................... 0........(0)........0

Hire Purchase (HP) debt ...... 8500.....(250)......0[b]

Total secured & HP debts...... 8500......-.........-   [/b]

[b]Unsecured Debts[/b]

Description....................Debt......Monthly...APR

Cc1............................11000.....350.......0

Cc2............................10000.....350.......0

Cc3............................750.......25........0

O/d............................2500......70........0[b]

Total unsecured debts..........24250.....795.......-  [/b]

[b]

Monthly Budget Summary[/b]

Total monthly income.................... 1,889

Expenses (including HP & secured debts). 1,260.55

Available for debt repayments........... 628.45

Monthly UNsecured debt repayments....... 795[b]

Amount short for making debt repayments. -166.55[/b]

[b]Personal Balance Sheet Summary[/b]

Total assets (things you own)........... 140,000

Total HP & Secured debt................. -8,500

Total Unsecured debt.................... -24,250[b]

Net Assets.............................. 107,250[/b]

[i]Created using the SOA calculator at www.LemonFool.co.uk.

Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]


I also pay 300 ish a year for logs for woodburner

Landline includes Internet

Mobile contract ends in January

The hp/secured loan is the car pcp

Buildings insurance includes contents

peb

Just to say hello and welcome,  if you haven't already done so I suggest that you post your proposals and your soa on the main board.   I don't know if the soa is current, aspirational or as proposed by Stepchange and gives you wiggle room but I won't comment on it not being anything of an expert!

Four_Seasons

Hi, welcome you will find lots of lovely folk on here who will give you advice, I am not an expert but will be following and cheering you on x

warby68

Very well done on making all the moves you already have to deal with the debts and the SoA detail provided. You do seem to have all the practical steps in hand and being unable to afford the minimums but still able to make a decent payment does suggest a DMP is the right thing.

Very personal I know, but your story suggests you may be quite low and generally fed up with what life has thrown at you. If that is the case, and you spend to cheer yourself up, there may still be some 'root cause' to address. It would be worthwhile tackling this alongside the debt to further cement your new approach and prevent you possibly derailing yourself. Of course, tackling your debt may well be the boost in itself.

A plan to clear debt by state pension age with a reasonable but not too restrictive budget sounds a solid strategy. If your car payments are within that budget I might go against conventional wisdom and say don't rush to swap cars. It might just feel a little too punitive and if its reliable, you might not want to go into the unknown of a cheap runaround when you live alone and remotely. 

For now though, welcome and good luck x

lillypoo

peb said:

Just to say hello and welcome,  if you haven't already done so I suggest that you post your proposals and your soa on the main board.   I don't know if the soa is current, aspirational or as proposed by Stepchange and gives you wiggle room but I won't comment on it not being anything of an expert!

Thank you.

I've been looking at the lemonfool soa tonight and it's a little bit different to the one I did on stepchsnge so I plan in doing a new more accurate one on my days off work next week. This one I published is very generous and in retrospect I think I can either be a bit more frugal  and add more to my emergency fund ..I just don't want to be so strict that I suddenly get the urge to splurge.

lillypoo

Four_Seasons said:

Hi, welcome you will find lots of lovely folk on here who will give you advice, I am not an expert but will be following and cheering you on x

Thank you.

lillypoo

warby68 said:

Very well done on making all the moves you already have to deal with the debts and the SoA detail provided. You do seem to have all the practical steps in hand and being unable to afford the minimums but still able to make a decent payment does suggest a DMP is the right thing.

Very personal I know, but your story suggests you may be quite low and generally fed up with what life has thrown at you. If that is the case, and you spend to cheer yourself up, there may still be some 'root cause' to address. It would be worthwhile tackling this alongside the debt to further cement your new approach and prevent you possibly derailing yourself. Of course, tackling your debt may well be the boost in itself.

A plan to clear debt by state pension age with a reasonable but not too restrictive budget sounds a solid strategy. If your car payments are within that budget I might go against conventional wisdom and say don't rush to swap cars. It might just feel a little too punitive and if its reliable, you might not want to go into the unknown of a cheap runaround when you live alone and remotely. 

For now though, welcome and good luck x

Thank you

I hate some of the mistakes I've made. I am already feeling better though ..now that I have a plan.

I've had a fabulous life so far, been  literally all over the world and done and seen things others only ever dream of. I have food abd shelter and my health. So I have much to be grateful for. I have no kids but I have my home to leave to neices and nephews. 

I don't just want to be debt free when I get my bus pass ...I need to be.

I'm not expecting this journey to be easy but I've got my big girl pants on and know I can do it thanks to the inspiration on this forum.

With regards to spending to cheer myself up. Yes that's been a major issue but the last three years have been so tight money wise, robbing Peter to pay Paul, that I believe I've now got this under control . Once a month I "treat" myself to a £5 bottle of Mr s house wine and that's as far as it now goes.  
It's enough! Never ever thought I'd be able to say that. 

I really appreciate your reply. Thank you

lillypoo

Going to bed happy. Looks like I've secured an extra shift at work. Little bit more to go in the various pots!

lillypoo

Saved £65 on home and contents insurance.  Yay!!