A few specific questions

thelibrarian11

Hi,

I've been in debt for a long time, maybe I will share some more of my story and situation eventually which ultimately centres on me being autistic and the impact that has had on my life, but I just have a few questions for now. I've been working on increasing my income and I've managed to do quite well (like over a tax bracket well which is really exciting) and I'm in a position to pay off debt for good this time. I've been reading a lot of the advice on here with interest, a lot of it is very good and I've picked up some things that will help already, so firstly thankyou for that.

I had a couple of questions from reading through things that I wondered if you could help me with. 

1. I know I'm an idiot for doing this, but I am on a Stepchange DMP then I took out a loan afterwards, with Salad money, which they don't know about. Do you have any advice on what to do with that, as I hadn't seen that mentioned on any other threads. I have kept up the payments on it but everything on the DMP is in default.

2. In passing I did see someone else talking about this and just wanted to ask this as well - I pay into a company pension. Would you advise pausing this until I am out of debt? I had looked at it and decided that the amount extra take home pay I would have really wasn't worth missing out on the benefits long term, but I wondered what your advice would be on that too. Should I opt out until I am debt free? I can guess what the start of any answer might be - that you need more information and it depends - but I'd really be interested to hear that in itself, I just have such a hard time gauging the social norms around all this stuff. 

Thanks so much for reading.

sourcrates

Hi and welcome to the boards.

If this loan is becoming unaffordable, you can just fess up to stepchange, they won`t judge you (seen it all before) and they can add that to your plan, if you want them to do that.

But if you did it again they would likely ask you to take your business elsewhere !!!

How much debt do you have? if stopping pension contributions won`t make much difference, keep on with them.

thelibrarian11

Hi, thankyou for responding. I have various debts and it's quite complicated, for example, one of them is a tax debt from working freelance on top of my full time job, and I've been in a debt cycle for a very long time (I feel a bit ashamed to say exactly how long), paying things off and then getting straight back into debt again, I've just been very vulnerable for a long time. But I think I know what to do and I have about £1000 a month to put towards debts, so I'm hoping by Dec 2025 I'll have it all sorted at last. In total across me and my husband this is about £19k.

If I get stuck I might ask some more things on here but that is helpful already. I had read on here if everything else is in default it doesn't make sense to keep up to date on this loan that's not defaulted, I may as well have a full house of defaults for all the difference it will make. As long as I don't do it again this will probably be fine, that's good to know... perhaps if I do get told I can't use StepChange any more I could give self management a go instead? 

Yes I'm fairly certain stopping pensions isn't worth it I did spend some time calculating, I pay in about 6% of my wage and it's a good scheme. I had stopped payments earlier in my career for the same reason so it's really risky for me to stop again now.

RAS

If your employer adds anything to your pension pot, then stopping is probably not a good idea, as you cannot divert that foregone income towards your debt and your are effectively stealing from your future self as well.

Grumpelstiltskin

You tell Stepchange you want to end your DMP, it's you that is in charge so just let them know you won't be making any more payments after this month.

thelibrarian11

Yes exactly I'd lose a lot more than I'd gain and it would barely dent the debts.

If your employer adds anything to your pension pot, then stopping is probably not a good idea, as you cannot divert that foregone income towards your debt and your are effectively stealing from your future self as well.

thelibrarian11

Grumpelstiltskin said:

You tell Stepchange you want to end your DMP, it's you that is in charge so just let them know you won't be making any more payments after this month.

Oh yeah, it's me that decides and they're just there to help if I want it, that makes sense thankyou.

Rob5342

I'd recommend managing it yourself anyway. Stepchange juat create complications you don't need, and give advice that benefits your creditors at your expense (advising people to start paying straight away instead of defaulting first) 

thelibrarian11

Thankyou, I'll look into self management, although I've been with stepchange for a few years now, I could finish the job myself. I've done settlements that I negotiated myself before so I think this is how it will end for me this time too. One thing I have realised is that only 1 of my husband's defaulted debts are being reported on his credit report, there are others tnat don't sppear on there, so if I get that clear, his credit rating will probably improve, which he would have to come off stepchange to do.

RAS

Have you checked all three credit records?

thelibrarian11

Oooh no only Experian because I have free access to extra features my employer gave me after a data breach! It could be different with different ones, good point.