Rubbish

lbcm1891

Hello. I'm a bit rubbish with money to be honest. Earn an ok income (42k) and have a small savings (4.5k- kept for car breakdown etc). I rent. I have 10k in unsecured debts costing me around 400 a month in repayments. I have a PCP car but this is essential (249 a month). I'm overdrawn every month. Not by a huge amount but it's getting to me, quite down about it. I can cut back on trivial stuff but I don't do anything fun anymore. I don't go out, isolated from friends because I can't afford to go out and do anything. I go to work and come home. So I am trying to face up to it finally. I'm thinking of getting a.loan to.pay off the unsecured debts, it'll bring the interest down and consolidate everything. I'll be cancelling a gym membership. To cancelling sky etc. Any advice grateful 

Jemma01

Would you mind laying down all your expenses for the past year? In a spreadsheet?
Download your bank statement and start categorising what each payment is for, and then add the totals per category per month & year. 

With 42K you really shouldn't have to find yourself isolated and not doing enough with friends. But if you tell us where your money is going, the folks here are great at looking at ways to save.

Mark_d

If you have £4.5k in cash I don't understand what you mean when you say you're overdrawn.  Are you earning 5% interest in a savings account whilst at the same time paying 40% interest on an overdraft?

I suggest you draw up a list of your bills/expenses to see what you can cut down and how much you can use for going out/treating yourself.

If you get a credit card with 0% for two years,  transfer as mush of your unsecured debt onto this card and make the minimum payments on this for the next two years.  At the same time, focus on paying your remaining debts - try to pay off the most expensive debt first.

birdsfoottrefoil

Hi! I’m sure you’ll be advised to do a SOA so people can better understand your situation.

but quick observations for a fellow “rubbish with money”:

- get it out your head that you’re on an “Ok wage”, you’re wage is good!! It’s way above the average salary. Start thinking that you get a lot of money per month and you can resolve your debt.

- 4.5k is a lot to have saved for repairs to a car which if on PCP you won’t even own at the end. Surely the point of PCP is that it shouldn’t break down? I have an old high mileage car and I wouldn’t expect to spend anywhere near that on repairs. So perhaps look at changing to either something that’s a make that has cheaper parts or hand it back and buy something out right? 

Mainly do a SOA and post on here so your situation is clearer. Also don’t expect your first SOA to be perfect. I’m on my second being confused as to why I still had no money at the end of the month, but it’s helped me see the areas that I’m unsure of my spending and need to monitor.

hope that helps! 

stu12345_2

please fill this in, it's your statement of affairs so then we. can see what is your predicament in more detail, thanks

cos we can then see for example the usual culprits such as high rent, high fuel, food etc, once you post this, we can look into more detail 


links


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

lbcm1891

Thanks for this. Bit overwhelmed. I'll look to do this asap. I've been burying my head in the sand for years. I don't even check my account.after pay day because I feel sick opening the app. It's silly how things trigger me!!

My little savings are not just there for the car really. I have pets who are covered by insurance but some things are not always guaranteed to be paid. I also see it as an emergency fund. I don't have an overdraft as such. I just get a message usually up to a week before pay day saying I've gone over and to put funds back in. I end up borrowing from the isa and then putting it back, eventually. 

Again, thanks so far for the advice. 

lbcm1891

Also I don't think I'd get an interest free card. My credit score is lousy. No issues in making payments. Haven't missed anything for over 7 years, probably due to the amount of debt

RAS

With respect to the debts, you need to list a bit more than asked in the SOA. 

So value and APR, plus for any loans and balance transfer, the end date, and for cards the card limit.

You don't have a huge amount of debt compared with many people here on your salary but you may pay higher rent etc, so the full SOA will help understand. Do sit down with your statements so you are reporting your actual spends, not what you perceive they are. And look at annual spends that aren't in those last few months like Christmas, birthdays, and holidays.

And regarding those friends who seem to afford more, many of them will have much more debt than you have and some will be desperately keeping up appearances.

Ex_welsh_borrower

Take a breath first, you are in the right place for solid advice on how to get on top of this

As many have said, sit down one evening and work on your SOA looking at bank statements to see where your money really goes. Like I was I bet you'll be very surprised when you actually see where it all goes.

The lovely folk on here will then be able to advise what works what doesn't to develop and accurate manageable budget to stick too.

Regarding a CC to transfer any interest accruing debt, have a look at this Credit cards eligibility calculator - MoneySavingExpert, won't hurt your credit score but will give you an indication on what may or may not be possible.

Anyway first step - SOA then post it on here

lbcm1891

Just looking at my original comment. It's 10k in loans and CCs but the PCP is in addition!!! Even worse! 😔 

Grumpelstiltskin

lbcm1891 said:

Just looking at my original comment. It's 10k in loans and CCs but the PCP is in addition!!! Even worse! 😔 

OK Get your honest SOA up here and when we see the full picture we can advise you the best way forward.