Unsure on best course of action

overhauler

Hi, new to the forum but hoping for some advice after burying my head for far too long about my debt due to low income and living beyond my means.

To lay out the basics, I currently owe:
Credit card 1.. £450.. monthly payment £28
Credit card 2.. £520.. monthly payment £33
credit card 3.. £800.. monthly payment £65

store credit 1.. £300.. monthly payment £18
Store credit 2.. £300.. monthly payment £12

short term loan £540.. monthly repayment £95

All of the above are current accounts which are open and up to date but I am making the very minimum payment each month, for the credit and store accounts they are basically maxed out and paying off the interest plus maybe a couple of pounds so not really decreasing

i have three debts that are very old and were passed to collections agencies which I have an agreement with:

legacy debt 1.. £464.. monthly payment £10 
legacy debt 2.. £100.. monthly payment £10
legacy debt 3.. £610.. monthly payment £10

total debt is £4084 with total monthly repayments of £281

my current credit score on Experian is 40 so pretty much none existent and in the very poor category which means I can’t consolidate into one loan or take out any further credit (obviously a good thing)

my monthly income is 1.6k with my set bills being around 1.2k for all bills/food/travel not including debt repayments

this does not include any clothes/birthdays/Christmas or any other incidentals which may pop up. I have no savings at all.

I have been paying like this for a while now but what I am wondering is whether this is the best way for me to do it? I don’t have anything extra to put towards them, nothing to cut from my budget and when things such as birthdays/Christmas come around I tend to fall behind on a bill to cover the cost so it just feels like a cycle I won’t escape.

is there a better way? I have been making sure I keep up with minimum payments as worried about my credit rating but it’s none existent anyway so would I be better reducing payments, requesting a freeze of interest or something else? I logged in and put all my details into step change which suggested that as I am meeting the minimum repayments that I just carry on but I am wondering if that is the best way forward.

genuinely unsure what to do for the best so any help would be greatly appreciated 

flipflopflo

Well your credit file is already trashed so I’d stop paying all debts and wait for them to be defaulted and sold on to debt collection companies. This will mean all interest will be frozen and you can start to look at self managing your own DMP. 

While you are waiting for this to happen you sort out a SoA that is manageable for you and also any excess you save into an emergency fund for when an appliance breaks or similar. 

Why don’t you post your SoA as it stands on here and people can help advise you. This is the one we like to use on here. Fill it out with how things stand right now, press format to MSE and copy and paste to this thread. 

https://www.lemonfool.co.uk/financecalculators/soa.php

enthusiasticsaver

If your credit record is already trashed and you are paying interest then I suggest you stop repayments on all, default and either go for a DMP through stepchange or self managed. You want the interest to stop so you can actually make a dent in the debt.  Defaults drop off your record after 6 years.  If you already have debts through a collection agency your record is  already affected so little point in paying minimums on the debts you are paying interest on.  Default, wait for them to sell them on then make affordable repayments and save for F and Fs. Same goes for legacy payments.  

Fill out the soa to find out how much you can afford each month and budget for things like presents etc.