Embarrassed of my situation and struggling to understand how I got here

Jabby1

So I’m 44 female mum of one teenage son 
I rent, don’t own a car, don’t go on holidays don’t have and savings I’m in nearly £30k debt and have just entered into a dmp
my problem is I’ve always been in debt
my parents didn’t guide me very well so I was never encouraged to save I kept thinking I’d eventually get out of debt but got to the point where I was getting more credit to just just live 

Im so embarrassed and struggling to understand how ie got to this point in my life 
I prioritised being a mum over my career which I’m happy I did but even so I’ve pretty much worked full time and just don’t see how I got in this position and I want to understand and so I can make sure I don’t get back here once I’m hopefully debt free 
I’m worried about my creditors chasing me for debt or eventually trying to take mr to court and I’ve recently entered a new relationship and feel as soon as I tell him about this it will be the end of that. 

My head is a mess and I just keep beating myself up and just really want to be better at life financially 

sourcrates

Natural to feel the way you describe, but honestly once an arrangement is in place, life goes on as normal.

Hopefully you are in a DMP with one of the free to use debt charities, and not a private company that charges you for the privilege?

Emmia

Lots of advice on here for you - it would help if you post a statement of affairs, so forumites can assess your budget and work out where your money is going, and where you can make savings.

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

Jabby1

I went with Payplan as it was suggested by my bank who I have a credit card with and will be one of the debtors then I got a new bank account 
I just feel like I’ll never be in a good financial position. It makes me so sad and anxious 
il have a look at the statement of affairs thank you 

Grumpelstiltskin

It looks like you may have panicked and entered a DP too quickly.

Did you let the debts default?  Have you saved an emergency fund?

If the answer to both of those questions is no then you have made the common mistake of jumping in too quickly.

Jabby1

Can I ask why they would need to default 
what is the benefit to this I had no clue I’d missed payments on quite a few accounts and was getting quite stressed with it all 
no emergency fund I didn’t know about the 

Grumpelstiltskin

OK If you start paying a reduced amount to your debts before they have defaulted your credit report is marked ' Arrangement to Pay' That mark stays there until 6 years after your final payment ( assuming England or Wales ) So if it takes 5 years to clear the debt the AtP stays for a total of 11 years.

Once the debt has defaulted the Default marks disappear 6 years after that date even if the debt has not been cleared.

Emergency fund, what happens if your washer dies a death followed the following week  by the freezer breaking down, you will have no access to credit so how are you gong to replace them without the back up of an emergency fund?

kimwp

Okidokie, it is a rare person who doesn't get themselves into a muddle over something at some point and finances are one of the easier things to fix, so don't worry. Probably the first thing is to cancel the pay plan arrangement (check for penalties, if there are, post back here). You need to give yourself time to build up an emergency fund by not paying anything to your creditors. This also has the advantage of getting your accounts to default, to stop interest being charged.

Next step is to fill out your SOA. This should be an accurate account of your finances- all money that you receive and all money that leaves your accounts. A year's worth is ideal, but start with three months.

Then we can help you figure out next steps.

Harry84

I'll leave it to others to advise you on the more technical side of things, but I will say, do not feel embarrassed or ashamed about this. Many people make poor financial decisions for their whole lives, especially if they have not been guided early on by parents or those they have grown up around. What you should focus on is your intelligence and bravery in identifying the problem, dealing with it and seeking the good guidance available on this forum.

sourcrates

Jabby1 said:

Can I ask why they would need to default 
what is the benefit to this I had no clue I’d missed payments on quite a few accounts and was getting quite stressed with it all 
no emergency fund I didn’t know about the 

Its not an absolute necessity to default first, but helps in a few ways.

First all interest stops, permanently, next, it ends the financial relationship between you and your creditor, you now have a six year window till your credit file recovers, regardless of what else you do.

It also gives you a chance to save into an emergency fund, which you will need.

The debt charities are OK, but are mainly creditor funded, with a mantra to get you up and paying as soon as possible, we on this forum think that can be a "one size fits all" approach, and is not always in your best interests.

It`s better to be fully prepared for what is to come, sometime debt management can last 6/7 years or longer, you must be comfortable in your position as it can be a long haul.

If your happy to continue, that`s fine, although at the very least I would contact Payplan and tell them you want to postpone your arrangement for 6 months, that gives you time to save some money, and for a few defaults to happen, that would be my advice.

MEM62

@Jabby1 Don't be too hard on yourself.  It sounds like you have had your lightbulb moment and there are things that you can do to improve your situation.  You will receive some great support and guidance from the boys and girls here.  You will soon be able to take control of your money instead of money controlling you.