Searching for a Debt Free Happy ever after

Winkflower

Morning!

I've been reading some diaries and lurking for a while and am taking the plunge to make changes for my family and to get debt free.

I don't want to make too many excuses but at 40 years old need to start to take charge.

I'd really love help and advice too with how to tackle things.

I have a gorgeous husband and much loved children from 5 to 14 and just want to get the stress of debt away and start living our lives - but also to get the advice here as i'm not sleeping for tossing and turning trying to work out what is best for us

A bit of background: We didn't have any money when I was child and scrapped about, red bills were found under sofas and we lived from hand to mouth. As a teen my parents came into money and then I just had the freedom to fritter and splurge. With no responsibilities  I would spend the money I earnt working whilst at school and we enjoyed amazing holidays etc.

I went to University and was offered overdrafts and loans at fairs with free pens as I would be earning fortunes after uni

In my early 20's my Mum passed away - she was the glue, I was out in the world on my own and struggling. Within a year of losing her I married an older man who took  over and charge of everything. This meant that for many years until he left I did not even access our bank account and didn't even try to learn to budget, my focus was working full time and our children.

Well he left when they were 2 and 7 and I went from rental to rental. I met my DH and he was 7k in debt. We both worked full time and got it paid off but with house moves and car problems and having our son, the pandemic and furlough etc, the cost of living, we got credit card after credit card and loan after loan with increasingly worse interest rates.

He works full time and i work 25 hours but last February we were at a point of spending more on interest than we could manage and were in a desperate place mentally. We never buy holidays, lavish material things, amazing outings so where was the money going?

On interest, bills and food it seemed. lots and lots of wastage where we would just buy dinners day to day. lots of money wasted on lunches and petrol stations snacks. We were eating and paying interest. Or statements looked like co..op receipts.

Sorry this is so waffly!

I'll post again with a breakdown but last February we were 40k in debt.

I started step change as quickly as I could so we didnt miss a payment (oops, should have read the forum first?) and we are down to 33k.

Here's the thing though. We are paying £607 a month and I don't think we can manage to continue living this frugally. We are scrapping about for food for almost 2 weeks so I think we need to change it.

On the subject of food we now pay £125 a week on food in as..da and do a weekly meal planner and just top up. We don't have takeaways, we've cut out as much adhoc spending as we can, we've been through the direct debits.

Mentally we are both in a bad place as we are stressed about living like this. We don't have any emergency fund and when the car went bang had to borrow from a friend (£800, we've paid half off).

We need an emergency fund but are already in step change.
We have a few defaults but not all.
We need to be able to face Christmas and Birthdays without fear and stress as we never look forward to anything we just panic.
We need a break
We need to work out paying less, we can manage £500 a month but not £607.

I'm tossing and turning because i've seen I should maybe have paid minimal amounts and got an emergency fund and think its too late?

We have 18 crediters, the smallest 4 are less than £250, should I be self maanging and paying themoff?

The largest  one for £8.5k to HS..BC have just rejected our renewal of £126 a month (was originally £301 before stepchange) Should I be concentrating on that?

I've seen posts about snowballing, about full and final offers and people chipping away at the smaller debts, should I be doing that?

I'd need to self manage I think, would that mean all the interest would start again for the larger ccs and we'd be on our own and back to square one?

DH is on board with making changes, budgeting, works hard and is wonderful, he's wondering if an IVA is the solution, I don't want to go down that route, I just know we need to do something as are so down all the time and it all feels like a battle.

Maybe i just need to change the stepchange budget?

I've started with prolific and curious cat and made £57 this week. We have 3 pots with £14 each for Christmas, Birthdays and Holidays but i'm just feeling a bit overwhelmed.

We are both doing overtime where we can,

Anyway Hi! 

Not expecting much response when I waffle so much but it feels good to get this down and hoping it will keep us on track and also help with all the wisdom i've seen here,

Will put a breakdown of our debts on, back to the kiddos as i've rambled so much.

Much love and Happy Sunday - wow and thanks if you read this far!

W x

RAS

OK, very quick response. Step change are great but will not have the staff to proactively seek reviews of everyone on existing plans whilst they deal with the flood of newcomers - no-one had.

Have you gone through your budget and revised for the cost of living rises? Have you shared that with Stepchange?

You should have money for an emergency fund built into your SOA.

Next time something goes clunk, ring Stepchange and tell them you need to suspend payments fir a month or two.

Must go as am late.

Winkflower

RAS said:

OK, very quick response. Step change are great but will not have the staff to proactively seek reviews of everyone on existing plans whilst they deal with the flood of newcomers - no-one had.

Have you gone through your budget and revised for the cost of living rises? Have you shared that with Stepchange?

You should have money for an emergency fund built into your SOA.

Next time something goes clunk, ring Stepchange and tell them you need to suspend payments fir a month or two.

Must go as am late.

Thankyou so much for reading and replying
DH is on nights.but just woke up and we jad a good chat.

Stepchange allows us a max of £20 a month to put in an EF, I created a savings account, put £20 each month by standing order, then about 2 weeks into the month have to transfer it over as we've run out of money and food so is on 0.

Good to know about being able to cancel a pament for a month if we really need to, that's reassuring.

We've just had a good chat and are going to go through our budget. Debt free date is currently 2027 and DH worried about the impact on us mentally of it going to e.g 2030 but I guess we can't have it all ways.

He's again wondering about an IVA but I'm worried apbut we'd then have people knocking on the door, it would be more formal and on a register and scary. I can only see the cons and he can only see the positives of an IVA.

We are on the same page of wanting to pay but also wanting to live a life where he can go fishing once in a blue moon,, I can see friends and pay for lunch, we can take the kids for day trips now and again and we aren't living hand to mouth. The constant panic and stress is takinghn years off our lives I'm sure.

Going to take a deep breath and have a nice roast dinner and try to keep my mind present for the children now before DH goes to work.

We are going to ring step chamge next week talk about our budget and options but also really appreciate advice on here.

My head is spinning with snowballing, self managing, interest rates.coming back, ivas, lower8ng the dmp, paying for more years, lots going on in my head to try and solve it all.

Will keep plugging with prolific and food plans. We only use vinted now and used to buy clothes on next for us all as we didn't have the money to get them but then increased debt. Trying to be more savvy now.

Thanks all if you read this far. 

Love the diaries I've read on here, they are so inspiring.

Might go and see the bluebells later, they always pick me up.

The children hage Sats and Mocks coming up so trying to keep their stress down and not let mine rub off.

Have a good Bank Holiday.

W x

Grumpelstiltskin

Do not under any circumstances jump into an IVA. I know the ads. on social media make it look fantastic, in most cases it isn't.

How much is your total debt and do you have a mortgage?

Winkflower

Hi thanks for replying, have read your good advice on lots of diaries so appreciate you commenting.
We are in social housing, I joined the list after my XH left and it took a few years but here we are. 
I'd love to be on the ladder but have ecru had th deposit amd have been raising my babies.
We were in 40k of debt last Feb and is now just over £33.
Thanks so much for reading. 
DH thinks IVAs sound great and less years but I'm not so sure at all.
He wants to ask stepchange If we should switch to one with them maybe but we are both open minded. I'm just trying to weigh everything up. I'm seeing hoe lots of people snow ball and work their way up the debts but wonder if they'd all start the interests and charges again and be back at square one.
Thanks,

W x

Grumpelstiltskin

If you are renting under no circumstances consider an IVA.

The only people they are suitable for are people with a mortgage and very large debts.

I think the first thing you need to do is contact Stepchange and say you can't afford your current repayments and you will have to cancel your payment until you have sorted things out.

Nothing is going to happen quickly, you are not going to get anyone banging on the door next week and you will have time to decide which is the best way forward.

NeverendingDMP

Iva will cost in fees etc and I think is something to be avoided. I've never had one so advice from others or a debt charity is recommended.  You've done the hard part by starting a dmp and the debt has gone down by a lot so far. You are having a huge shock to the system on what you appear to be finding a very tight budget. I know stepchange is only allowing 20 per month for emergency but what is your budget for other things. For example 125 a week for food might be upped to 160 a week(I'm guessing there is 4-5 in the family) Definitely revisit the budget perhaps with a soa on here and then with stepchange. An extra six months of paying compared to being so short half way through the month might be worth it. Also things like CCA requests , full and final settlements can shorten the time frame anyway. And the debt that isn't accepting your payment offer has no choice, you can't pay what you can't afford. They will figure it out eventually!
The dmp support thread is a good place to have a read. (With a cuppa or two!)

Winkflower

Thanks so much for commenting. Are we allowed to do CCAs and full and final settlements whilst on a DMP with step change? I'd also love to pay off the lowest 4 somehow which all amount to less than £250 but believe you can't show favour? I just think less creditors would feel better psychologically.

Thanks so much for taking the time. Will do a SOA and will also have a good look at the budget thankyou 

W x

sourcrates

Winkflower said:

Thanks so much for commenting. Are we allowed to do CCAs and full and final settlements whilst on a DMP with step change? I'd also love to pay off the lowest 4 somehow which all amount to less than £250 but believe you can't show favour? I just think less creditors would feel better psychologically.

Thanks so much for taking the time. Will do a SOA and will also have a good look at the budget thankyou 

W x

A DMP is an informal way to deal with your debts, all stepchange do is distribute your monthly payments, they can advise you on most aspects of debt management, and you are free to take that advice or not as the case may be.

CCA requests are just one of the statutory rights afforded to you by the consumer credit act, and I would encourage you to use that to your full advantage, likewise, further down the line, you may want to settle certain accounts yourself, and that is fine, once a deal is done, you just ask stepchange to remove that account from your arrangement.

Winkflower

sourcrates said:

Winkflower said:

Thanks so much for commenting. Are we allowed to do CCAs and full and final settlements whilst on a DMP with step change? I'd also love to pay off the lowest 4 somehow which all amount to less than £250 but believe you can't show favour? I just think less creditors would feel better psychologically.

Thanks so much for taking the time. Will do a SOA and will also have a good look at the budget thankyou 

W x

A DMP is an informal way to deal with your debts, all stepchange do is distribute your monthly payments, they can advise you on most aspects of debt management, and you are free to take that advice or not as the case may be.

Asking if you are allowed to do something, suggests you are in some way under the cosh from these people, they are simply a debt charity, nothing more, its not like they are a religious cult or anything of that nature, watching every move you make.

CCA requests are just one of the statutory rights afforded to you by the consumer credit act, and I would encourage you to use that to your full advantage, likewise, further down the line, you may want to settle certain accounts yourself, and that is fine, once a deal is done, you just ask stepchange to remove that account from your arrangement.

Thankyou so much for reading and commenting.

It was such a terrible time (brought in by our own bad decisions I know) when the interest rates became higher than our incomings that  I think I'm just pretty fearful of getting it wrong or them cancelling the DMP if we don't abide by their terms.  I'm worried if I self managed the companies would start adding interest again and we'd sink. Or stepchange saying we are favouring creditors and cancelling it and being back in a hole.
Really want to continue to take responsibility, to pay it back, to learn from it and to change habits, just  a lot of wondering about the most savvy way to do so.

E.g if I did cancel my payments with step change to take stock would they then cancel the plan - you are so right though they are a charity.

Desperately wanting to be debt and fear free as we have a happy lovely life otherwise. Would also like to get on the ladder but don't have the 35k deposit it would take for a 10 percent deposit where we live in an expensive area in the South 

Lots of goals to strive for.

Thanks so much, have also seen you comment on posts and appreciate and value your input!

Best wishes

W x

Grumpelstiltskin

If you do a SOA make sure you have the interest rates on all of the debts as that will help if you decide to snowball.

You have to remember that you are in charge and if you tell Stepchange you can't pay anything at the moment then so be it.