I need help and don't know what to do

RicVic

Good evening folks

I really need some help as I'm starting to get stressed about what I can do with my spiralling debt.  I'm paying interest on all my cards and unable to get a balance transfer card to shift some of the debt.  I'm also unable to get a loan to consolidate my debts so I don't know where to turn.  

I've done the SOA which is below and would be grateful for any advice on what to do.

Household Information
Number of adults in household	1
Number of children in household	0
Number of cars owned	1
Monthly Income Details
Monthly income after tax	1896.82
Partners monthly income after tax	0
Benefits	0
Other income	0
Total monthly income	1896.82
Monthly Expense Details
Mortgage	283
Secured/HP loan repayments	0
Rent	200	Shared Ownership
Management charge (leasehold property)	0	Covered in Rent
Council tax	115	single person discount
Electricity	97.5	Dual Fuel tariff - DD is £195 per month
Gas	97.5
Oil	0
Water rates	17.55
Telephone (land line)	0
Mobile phone	50
TV Licence	13.25
Satellite/Cable TV	54.5	includes phone line & broadband
Internet Services	0
Groceries etc	150
Clothing	0
Petrol/diesel	100
Road tax	0	Pay 6 monthly - due in October
Car Insurance	9.25	paid for car insurance for year - due January 2024 (9.25 is for breakdown cover)
Car maintenance (including MOT)	0	MOT is due January 2024
Car parking	0
Other travel	0
Childcare/nursery	0
Other child related expenses	0
Medical (prescriptions, dentist etc)	21.96	contact lenses
Pet insurance/vet bills	0
Buildings insurance	0	Covered in Rent
Contents insurance	20.53
Life assurance	0
Other insurance	0
Presents (birthday, christmas etc)	0	don't really buy presents
Haircuts	0	maybe have haircut once or twice a year
Entertainment	0	rarely go out
Holiday	0	no holiday planned
Emergency fund	0
icloud storage	0.99
itunes	10.99
Postcode Lottery	12
Barclays Blue Rewards	5
Total monthly expenses	1259.02
Assets
Cash	0
House value (Gross)	125000	50% shared ownership - this is the approx value of my share
Shares and bonds	0
Car(s)	2000
Other assets	0
Total Assets	127000
Secured & HP Debts
Description	Debt	Monthly	APR
Mortgage	125000	283	2.49%
Total secured & HP debts	125000
Unsecured Debts
Description	Debt	Monthly	APR
Barclays Loan	3671.21	231	not sure
Barclaycard	1549.39	50.1	22.27%
Very catalogue	571.76	12.08	not sure
M&S Credit Card	2758.81	76.63	23.90%
MBNA Credit Card	441.81	25	32.12%
Virgin Credit Card	4757.81	133	21.66%
Total unsecured debts	13570.79	527.81
Monthly Budget Summary
Total monthly income	1896.82
Expenses (including HP & secured debts)	1259.02
Available for debt repayments	637.8
Monthly UNsecured debt repayments	527.81
Amount left after debt repayments	109.99
Personal Balance Sheet Summary
Total assets (things you own)	127,000
Total HP & Secured debt	-125,000
Total Unsecured debt	-13,751
Net Assets	-11,751

elsien

Just a starting comment for you - I appreciate how difficult it is post these.
You need to have something in your budget for car maintenance and the foreseeable future car expenses such as MOT, road tax and service. You know these will be coming so need to start building up towards them now otherwise when they are due they will just end up on the credit card.

The second question is what has caused you to build up the debt? That's not a judgement but your SOA shows you should be managing with money left over towards your debts. Except that clearly isn't the case. So you need to know where your debts have come from in order to stop overspending in those areas in the future. Otherwise you will struggle with any debt management solution. 
That's kind of a long winded way of asking did you lose your job, are you an impulse spender, is it from a few years of overspending on day to day things? 

Martico

A couple of points on first glance - you should have enough to start overpaying, and if you are truly able to overpay on your credit cards, I'd target the highest interest rate one first. That's MBNA, and is also the lowest current debt, so an achievable write-off in the shortish term. (Edit: though I would guess that your Very debt most likely is charging the highest monthly interest)

Your contents insurance looks very high. I pay around £120 per year for building and contents insurance combined. 

Barclays Blue Rewards is only worthwhile if you pay in a certain amount (£800?) per month to your Barclays current account and have a couple (might only be one) of DDs from that account. Then your £5 gets reimbursed. AND you gain access to their 5.12% Rainy Day easy access savings account. Should you want to start an emergency fund, that would be sensible.

Postcode lottery is something you can put to one side while you focus on debt reduction.

But, as elsien says above, the main thing is to have a realistic assessment of your true monthly budget, as it seems like money is leaking somewhere along the line.  

Martico

And within that budget, set aside a certain amount each month for those annual and semi-annual costs like MOT, road tax, etc.

enthusiasticsaver

You cannot borrow your way out of debt so a debt consolidation loan is the worst thing you could do.

Your soa shows you should be able to make repayments so is it accurate? 

I would cancel the postcode lottery and the Barclays rewards. I would start putting something aside for car maintenance etc. Your contents insurance looks high so make sure you are checking comparison sites and get rid of the extras. 

The main thing is to stop using credit. If you are unable to do a 0% BT I would focus on MBNA and Very as the smallest and pay any extra money you have to those. 

kimwp

Congrats on one of the most thorough initial SOAs I've seen on here, great commenting (yes, I am an SOA nerd). The best thing to do is divide annual payments by 12 and put that figure in your SOA - commenting that it's paid annually etc. Then you'll be able to see the impact of those annual spends of your monthly cashflow.

itsjustafad

Hi, just a quick note about Barclays Rewards - Please don't cancel it, you get an extra £1 per month as a "reward" for having a loan with them.
If I were to offer any advice, it would be to take your £6 per month and set up a direct debit to the Rainy Day account to kick-start your emergency fund. It doesn't sound like much, but will just sit there growing in the background even if you do nothing else.
Good luck on your journey 

enthusiasticsaver

Surely if the Barclays rewards is showing as an expense that indicates the OP is not fulfilling the criteria for getting it reimbursed? 

fatbelly

Blue Rewards requires you to pay £800+ into the current account, sign up to online or mobile banking and pay a £5/month fee (though it pays £5 cashback each month you pay out 2+ direct debits – so the fee is essentially waived).

There is a very good linked saver account paying atm 5.12% on up to £5000

2.49% is a very good mortgage rate - when does the fix finish?

RicVic

Morning, firstly thank you to everyone who has responded to my post, it really is gratefully accepted.

To answer some questions –

·         Debt has built up by using credit for day to day living, I have nothing to speak off to show for this (except maybe for some fishing equipment)

 

·         I manage the minimum payments on the cards but all are very much at their limit now

 

·         I work full time

 

·         Yes, I would say I am an impulse spender but again I don’t have anything to show for it

 

·         *this I think is the most important one* I have also finally admitted to myself that I have a gambling addiction. I looked at my bank statement this morning and for the period 25th June to yesterday I have spent £270 on a couple of different sites so I have now closed my accounts and deleted the apps from my phone.   The sums were always £10 or £20 so didn’t really notice them coming out.

 

·         I thought my contents insurance was ok for the home & contents I have.  I’ve only just renewed with my insurance with my bank at a yearly cost of £241.15.  Am I able to cancel and shop around for new insurance ?

 

·         Barclays Blue Rewards – I receive £5 back as a loyalty reward for DD’s and then £3 for my mortgage and £1 for my loan.  This goes into a separate pot but when I’m skint I dip in to it and currently have £19.24 in there.  I now plan to leave this untouched as I’ve seen that over the course of having this I have effectively earned £884 !!!

 

·         I have the ClearScore app on my phone and looking at that I’m pre-approved for 3 Balance Transfer cards.  1) Post Office. 0% for 3 months and 2.9% transfer fee (APR is 29.9%).  2) Capital One.  0% for 6 months and 3% transfer fee (APR is 34.9%).  3) Aqua Classic.  0% for months and 3% transfer fee (APR is 34.9%).  The credit limit for all 3 is upon application so wouldn’t imagine that the limit would be very high.

 

·         In regards to the mortgage it is fixed until 31st May 2027.  Thankfully my previous fix came to an end at just the right time before the rates started going up.

fatbelly

Then May 2027 would be a good target for getting rid of the nonpriority debt.

Any debt you can get on to 0% would help but you need to be overpaying the most expensive debt each month