Ashamed and Upset

ashamedjelly

pallyman said:

You say you have one car & fuel £150 then say £50 ev charging,do you have 2 cars.

Yes we do, but mine is a company car so insurance, repairs, tax etc is covered by the business. £50 is the average per month I spend on personal miles

ashamedjelly

Grumpelstiltskin said:

Cable TV £177 per month? That needs reducing drastically. On top of that I can see Disney Plus Amazon Prime and Spotify,  You need to seriously decide what you want, there is a number of places you can cut back easily.

Thanks for your comment. Cable TV also covers our broadband - we live in a rural area, I work from home and require fibre broadband so it costs more than if we lived in a city or town. Also, we have no social life, don't go out anywhere, no holidays - so watching tv is our only form of downtime. 

ashamedjelly

agentblackcat said:

Hi Ashamedjelly. 

I'm in a similar position to you with a similar debt amount. I have just started the journey in December. At least half of my accounts are now defaulted. I honestly feel so much better now. I feel in control and I know it going to take forever to repay things but I have never felt as good as I do now. Read the pinned threads, they helped me so much. 
You need to stop paying your debts. I think you need to speak to your husband, you can explain you have a plan.

Also I think like others have said make sure your budget is enough to have a life. You don't want to spend the next few years living really tight. So make sure you have enough to comfortably live on. I also recommend when you stop paying debts until defaults, save money into an emergency fund, you might need it for future repairs etc. 

I also will be managing this as a self managed dmp. Anyway good luck and I look forward to following your journey:)

Thank you so much for your lovely comment. Why is it that facing up to things is often the hardest step?! I've been working on what realistically I'm able to offer creditors when my accounts default - it looks as if I'll be able to offer quite a bit whilst still having a bit of a life and saving for an emergency fund which has buoyed me a little. 

I'll keep following your journey too - it's such a comfort knowing that other people are in similar positions. Being in debt is a lonely existence! 

kimwp

ashamedjelly said:

sammyjammy said:

Congrats on the successful IVF, if your husband doesn't know how does he think the IVF was paid for?  Does he have debt of his own in addition to what you've lsited.

People will try and help, try not to take the advice personally, there is no judgement here, most of us have been in debt and needed some type of assistance at some stage.

Thank you for your kind comment. I did have savings before IVF so he believes the numerous rounds were funded by that. I didn't have the heart to tell him those funds ran out after the first two unsuccessful rounds.

So either way (savings or debt), the IVF was funded by you and he took no responsibility for funding it. And you earn double what he does. If he leaves because you are in debt, then he's a bit silly to say the least.

Rob5342

He will find out about your debts, the only question is when, he'll notice that there is never money for anything for years on end. It's best just to just tell him now and deal with whatever it entails, then you can get on with tackling the debts. This comes up quite quite often here, when people tell their partners it usually isn't quite as bad as they had imagined. I didn't tell my wife for years and it was causing me a huge amount of stresa. She was quite shocked when I did tell her but rather than being angry she eas more upset that i hadn't told her. Things were difficult between ua for a while but now we are working together and have made a huge dent in things. 

13thlegion

Firstly, welcome and well done for posting. And congratulations on the little ones. TL:DR version you've got this.

How you feel is understandable, and felt by many of us here, so you are amongst friends. As always, emotions can be difficult to read in text posts (including mine!) so as was said above don't take anything personally.

What strikes me about your situation is it is a big hole but you have a big shovel, as Dave Ramsay would say. So the numbers themselves don't matter that much. And things like a Disney+ or Spotify subscription is not going to make a massive difference on their own. You could be debt free in about 4 years which is a realistic timeline and sets you up really well for when the children are a bit older and keep on being expensive!

There some things that stick out to me where some rearrangement may be of benefit. With a moneysaving hat on your TV package is very high, and your mobile bill can come down a lot (if / once out of contract) via a sim only. I'm a big fan of using the MSE site to get deals on things you need anyway, like mobiles/internet/insurances etc. Even if some don't drop a large amount, the process may help keep your mindset going. I would also suggest saving a small holiday fund regularly is a good idea. Even if it is just for trips to the seaside with the kids or pepper pig world/lego land. They will remember those things when big enough and do you wellbeing a lot of good as well.

I agree with your assessment that a DMP seems the best option. The recent advice here seems to be not to engage with step change until the defaults are all registered to avoid Arrangement to Pay (AP) markers which leave a mark longer than defaults. (6 year after final payment for AP marks and 6 years from first registered for defaults)

The biggest things I think you will struggle with - you can do them I really believe that they will just be difficult - is:
1. telling your partner. They are the person you rely on in this would to support you and you support them so being open and honest is the best situation. Having a solution handy and keeping blame out of conversations will help. 
2. learning to live without access to credit and relying on budgets and preplanning for things, including house renovations.

On the 2. point. You do not have an emergency fund in your SOA. This is going to be vital. It is essentially paying a debt to yourself before you've borrowed it, if that makes any sense. Your piggybank that works the same way a credit card does for you now. In your situation I think a healthy emergency fund is vital as even just 1 month with no income or a big emergency would be catastrophic. 

Luckily I think the path itself is straightforward to map - the test will be walking it. I also think that you would be more than able to sort a self managed DMP. Imagine you were doing it for a friend or family member may help to remove any sense of guilt from yourself.

Firstly - stop paying the consumer debt. All of it. Ignore contacts etc until they default. There is guidance on how to minimise nuisance contact elsewhere on this forum.

Secondly - Take the £2,283.13 per month that is not going to other outgoings and put in an emergency fund. Very quickly this will add up and be your protection going forward.

Thirdly - When you have the defaults start making affordable payments, keep contributing to the emergency fund, and put a little something away for family holidays (the emergency fund is definitely NOT for things like that even if a seaside day trip would have gone on the credit card in the past!).

I have put your debts into the lemonfool snowball calculator for the example below.

Example with figures. £2000 is budgeted to pay debts. £183.13 per month goes to your emergency fund, £100 goes to holiday fund. This assumes no other changes to the info you have already given. 

£100 goes to each debt per month except 1 (pick any one) which gets £900 thrown at it per month until it is clear. When that is clear roll that onto the next one and so on. Lemonfool calculator says you will be debt free in 52 months, which 4 years and 4 months. 

What will affect this timeline is the date of defaults, unlikely they will all happen at once, but as they happen you can start the £100 with each in turn. Later on you may get the chance to settle the balances for a discount as your debts get sold on to other companies, another reason to keep saving each month into the emergency fund.

EssexHebridean

Some great comments already made here - and firstly and most importantly of course, congratulations on the arrival of your little ones, even if they ARE costing you a fortune in nursery fees! 

It sounds like your lightbulb moment has well and truly arrived which is an excellent starting point and means you should be ready to hit the ground running with possible savings. I've added some comments to your SOA in the usual way below. 

ashamedjelly said:

<snip>
My husband is unaware of my current financial situation. I fear it might lead to him leaving me if he knew the extent of my debt. First up, you need to tackle this. He knows what his income is, and clearly he knew what the cost of the IVA was. Allowing that I also assume that he knew roughly what level of savings you had beforehand, that means he should also be aware that the sums simply don't add up on this.  He will find out - as others have said - so you have a choice - tell hi8m yourself, explaining the background, or let him find out, at which point he is likely to be upset on a whole other level. 

Household Information

Number of adults in household........... 2

Number of children in household......... 2

Number of cars owned.................... 1

Monthly Income Details[/b]

Monthly income after tax................ 5264

Partners monthly income after tax....... 2197

Benefits................................ 0

Other income............................ 0

Total monthly income.................... 7461

Monthly Expense Details[/b]

Mortgage................................ 2088 what rate is this on, and when does that rate end?

Secured/HP loan repayments.............. 0

Rent.................................... 0

Management charge (leasehold property).. 0

Council tax............................. 254

Electricity............................. 178 Are you electric only or does this cover gas as well? Are you on the best tariff you can be, and do you make sure you are using as little as possible? Are you getting accurate bills based on actual readings?

Gas..................................... 0

Oil..................................... 0

Water rates............................. 36.9

Telephone (land line)................... 0

Mobile phone............................ 55 Are you still in contract for these? Of not look at switching to SIM only deals - you should be able to find something for £10 a month or thereabouts. 

TV Licence.............................. 14

Satellite/Cable TV...................... 177 This is huge - and can definitely be managed down. Don't be concerned about splitting your broadband away from a TV package - indeed, you will very likely get faster broadband for less money! As for the TV side of things, a basic package with the addition of things like netflix, amazon prime etc as needed on a monthly basis will be better value. YouTube is free of course and plenty to watch on there!

Internet Services....................... 0

Groceries etc. ......................... 400 This is on the high side and there may be small changes you can make there to have an impact. Have a look at doing the "downshift challenge" - details on the main MSE site IIRC!

Clothing................................ 50 

Petrol/diesel........................... 150

Road tax................................ 21

Car Insurance........................... 33

Car maintenance (including MOT)......... 40 You are obviously quite high mileage, so does this actually cover all servicing, tyres, wipers, MoT test, cleaning and everything else you need for the car? 

Car parking............................. 25 Can this be reduced by parking a little further away and walking?

Other travel............................ 0

Childcare/nursery....................... 948

Other child related expenses............ 200

Medical (prescriptions, dentist etc).... 35 Can this be reduced by use of pre-paid certificates for prescriptions?

Pet insurance/vet bills................. 45

Buildings insurance..................... 38 This and the contents insurance seem quite high - have you checked to be sure you are paying the correct price?

Contents insurance...................... 33

Life assurance ......................... 37 

Other insurance......................... 0

Presents (birthday, christmas etc)...... 40 Does this cover everything you spend in this area? Often, under-budgeting can be a cause of people finding they get caught out financially.

Haircuts................................ 60

Entertainment........................... 100 Can any of this get swapped out for free alternative activities?

Holiday................................. 0 You never go anywhere that costs you money at all? Not even a visit to family?

Emergency fund.......................... 0 You definitely need to start budgeting here! 

EV charging............................. 50 Can this be reduced by charging at home?

Disney Plus............................. 6.99

Dog food................................ 40

Amazon Prime............................ 8.99 Some choices need to be made around the entertainment side of things I think - there is a lot of income being spent on various things which need to be considered as luxuries now.  It's great to have 100s of TV channels to choose from if it can be afforded, but at the point when it can't, then that is where wise decisions need to be made. 

Spotify................................. 13.99

Total monthly expenses.................. 5177.87

Secured & HP Debts

Description....................Debt......Monthly...APR

Mortgage...................... 370000...(2088).....4.98

Unsecured Debts

Description....................Debt......Monthly...APR

Halifax CC 1...................7954......267.......0

M&S CC.........................4313......116.......0

Halifax CC 2...................4561......210.......0

Next...........................2243......140.......0

Paypal.........................3353......150.......0

Shop Direct....................2614......120.......0

Novuna Loan....................17500.....398.......0

Tesco Bank Loan................21860.....455.......0

Barclaycard....................8044......326.......0

Lloyds Bank....................8038......343.......0

Virgin Money CC 2..............7750......218.......0

Virgin Money CC 1..............14930.....455.......0[

Total unsecured debts..........103160....3198

Monthly Budget Summary

Total monthly income.................... 7,461

Expenses (including HP & secured debts). 5,177.87

Available for debt repayments........... 2,283.13

Monthly UNsecured debt repayments....... 3,198

Amount short for making debt repayments. -914.87

Is all your debt really on 0% It seems unlikely allowing you have some loans in there, so I think you need to get the up to date/correct details completed there so you know where you stand. 

I think you are correct that a DMP is going to be the right way forwards for you. 

kimwp

You can get Disney plus for free if you have a Lloyds club account.

MattMattMattUK

ashamedjelly said:

pallyman said:

You say you have one car & fuel £150 then say £50 ev charging,do you have 2 cars.

Yes we do, but mine is a company car so insurance, repairs, tax etc is covered by the business. £50 is the average per month I spend on personal miles

What is the tax cost of that? Do you need two cars or could you manage with one?

ashamedjelly said:

Grumpelstiltskin said:

Cable TV £177 per month? That needs reducing drastically. On top of that I can see Disney Plus Amazon Prime and Spotify,  You need to seriously decide what you want, there is a number of places you can cut back easily.

Thanks for your comment. Cable TV also covers our broadband - we live in a rural area, I work from home and require fibre broadband so it costs more than if we lived in a city or town. Also, we have no social life, don't go out anywhere, no holidays - so watching tv is our only form of downtime. 

TV Licence.............................. 14

Satellite/Cable TV...................... 177

Amazon Prime............................ 8.99
Disney Plus............................. 6.99
Spotify................................. 13.99
Total: £220.97

You are spending a huge amount on this, there is no way around that. You might live rurally but fibre will still only be in the £40-50 reason for a 500mb connection, worst case you could get Starlink for £75 per month. The situation you have got yourself into is going to require you to make some cutbacks, your huge TV bill should be one of them.

Get just broadband, you should be able to get something decent in the £40 region, but even if not Starlink is the absolute upper threshold at £75 pm. Get rid of the TV license and live TV, the TV package etc. and then rotate between Disney+, Netflix and Prime monthly, with only one active at a time. 

I am also not sure what Spotify plan you are in, individual is £11.99, duo which would cover both you and your husband is £16.99, there is no £13.99 plan.

No one is saying you cannot have downtime or entertainment, but this cost can be cut quite significantly and it would have very little impact on your relaxation. 

ByzantineByron

Hi @ashamedjelly

I just want to congratulate you on taking the first step. Like you I have only just started my journey as I realised I had simply run out of road. It's daunting but you can do it, especially given that your salary gives you some wiggle room. A few points (which will be repeats of other posters)

* Please, please, please tell your husband. He knows your salary and unless he is the literal definition of a village idiot, he will have put 2 + 2 together and realised that the numbers don't add up. He may assume it's all in hand as you've never raised it with him, but he now needs to know that you're in trouble but you have a plan. You may not need his financial support, but you need the moral support.

* Secondly, a DMP is probably the best idea or an IVA (although they will probably just tell you to remortgage to release equity and pay all the debts off). The key to a DMP is that you need everyone to default. Some will take longer than others. Conventional advice hammers into us that we need to make payments where possible but you need to stop this. You're robbing Peter to pay Paul and it's no longer viable, in addition stop making payments to all creditors. You cannot show undue preferential treatment to any one creditor. Your focus needs to be on the mortgage, council tax and other stuff that is essential for living.

* Build up an emergency fund and actually just enjoy the freedom. It has been liberating not worrying about my debts (as I'm in an IVA) but also will train you to live without credit, which is important. I have a number of bills which previously I'd have whacked on a credit card which I now cannot and it is a big deal.

Please keep us updated, we are all behind you.