Seriously need to take action before we lose everything

philleaf

Thanks for the posts guys - appreciate it. I agree that we need to reflect on our recent spending. It will be awful, hundreds and hundreds of pounds wasted every month. Just getting through the month with no thought or plan. Things really have to change. I am so very very ashamed that our debt payments exceed 2k a month. It makes me blush and feel sick just typing that. What an absolute idiot

Martico

No need to feel ashamed, we've all been there to some degree. I found keeping a spending diary very helpful and instructive. Just a spreadsheet where I started monitoring spends, and then adapted that to take in planning and budgeting, trying to keep to broad daily or weekly limits. 

caprikid1

What concerns me is that you currently have £1500 spare every month and have over £90,000 in debt.

If all of that were on interest only that equates to over £18000 paid off in the first year assuming your budget is realistic but clearly you have been spending probably in excess that that leaves a lot of debt to pay and a long time to do it. I have personally feel that you need the rigidity of a DMP as I cannot see you have the discipline.

I think whilst paying it off is possible why have you left it till now ? You both came into the relationship with debt so clearly there is an underlying lack of self discipline as you don't mention life events ?

I think you have hit a wall not due to the amount of debt but the availability of more credit / Zero interest balance transfers.

What has changed for you to make a change ? Why do you think you will clear it now when clearly you have made little effort before.

To give a little understanding, how old are you current cars ? Are they prestige models ? How many foreign holidays in the last few years ? Are you now prepared to give that up ? or make some real life changes ? I think you are looking at 5 years to really get back on track. 

I think it would be really useful to sit down and reflect on the past and accept that to achieve this is going to be a shock, champagne to lemonade not Champagne to Cava !.

kimwp

I echo the previous statement about a spending diary. Frequently (at least every month, but weekly or fortnightly might not be a bad idea to start with) reviewing what you spend in each category helps you understand your spending and also control it because you can adjust before you've completely blown the budget you've set.

Floss

Your SOA is aspirational - to be really clear where your income is going, you need to get together 12-months bank statements and find out exactly how many times there have been takeaways, cash withdrawals, clothes bought, extra fuel put in the cars... Then revise your SOA with the actual figures, sit the kids down & explain that belts will be tightened.

It's doable on your salaries, but you ALL need to be onboard & disciplined about it.

theoretica

So, as often, that SOA is aspirational, and what you hope to spend going forward?  Your first challenge is to ensure you stop and think before spending.

'Is it in the budget'?  Do we really need to change the budget?  - Chances are, as you live with it you will need to change the budget a bit - clothing 4 people on £360 a year total may just not work - but maybe you can move some money from presents or groceries.  But think, and discuss, don't just splash out!  Thinking more about money means you know where it is going and how much you have, which in turn means you don't have to worry about money, because there is little uncertainty.

So first - is keeping track of your spending, knowing what you need to spend on, and begin to clear a few of the highest interest accounts - Very and the overdraft!

Is there anything from previous overspending you could return, or sell?  Or even put aside to be a future treat or present?

theoretica

Just to add that, in an age appropriate way, it could be positive to include the children, don't think of it as depriving them.  Teach them budgeting is something adults need to do and how and it will be great for their future financial security!

Sg28

Taking your soa at face value that doesnt look bad at all. You have good incomes and £1500 a month spare even after making your repayments. Thats more than the vast majority of people have spare at the end of the month! 

Yes your debt is high but its certainly manageable on your incomes. You just need to ensure it doesnt get any worse, ensure no more debt is taken on, keep on eye on your spending and start overpaying the debt with the highest interest rate first. 

Yes you do need to take immediate action but I dont think you are currently anywhere near to "losing everything". 

No19v87

If you really had £1.5k spare a month you would not be posting on here. The first step is to work out where that is actually going and stop spending it.

enthusiasticsaver

That soa is clearly incorrect or you would have £1500 spare each month. Do you really never do holidays or weekends away? 

I think the first thing is you both need to agree you don’t use credit any more and then work out where the £1500 is going. You don’t need a DMP but you do need some financial discipline.