I'm sick with worry and need help please

jones98746

I’m struggling with money again, and I don’t know what to do. I feel completely lost. The worry is eating me up inside—I can’t sleep, I feel sick, and it’s so overwhelming. I need help, but I don’t even know where to start. I am awful with money, and I always have been.

I was made bankrupt back in 2010, and discharged after 6 months and that came off my credit file in 2016 – so if bankruptcy is an option, it would be for the 2nd time, and I assume stiffer penalties (I don’t know). I sold my house in 2021, spent the money made from the house over the next 3 years and then kept spending.

I am now coming to the end of my credit card zero fixed rate balance transfers, and they are accumulating interest. I also have a loan. I can afford the minimum payments at the moment; I have not defaulted.

I do not own property as live with my parents, I am single and have a 15-year-old son, my 18-year-old son and his girlfriend live here too. I may inherit their property in the next few years as my parents are elderly – and I do not want to lose the property (no mortgage on it) I am also the executor of their will, if this affects anything.

I am on Universal Credit, (sole trader and employment) which will end in 2028 as my son leaves education then or it may stop due to claiming from earning over the limit, if I earn too much in my newly started business. I retrained for 3 years (have student finance) and started a sole trader business one month ago, that is not in debt. I do not want to lose this business, it's in the early stages but I hope it will make me a good income eventually. I may want to study for a master’s and will need to borrow student finance, so I don’t want any options I take to hinder this, but not overly important.

I have a car worth about £5400 on HP – can I keep paying this? I don’t want to lose my car as I need it for my business and my mother has a disability.

I would like options and advice please, iva, dro, bankruptcy, not sure what to do, but I need to stop this worry, it is making me ill.

Few questions:

I’ve heard awful things about IVA, is this a good option, any advice – will inheriting property affect this or being an executor on a will?

I believe I have too much income for DRO.

If I went into Bankruptcy again? - 2nd time what if I inherit the house over the next few years will they take it?

Can I still run my own business with the debt solution I take?

Will my being an executor/ and power of attorney on my parents will affect anything?

I bank with Barclays, and one credit card is with them – should I change banks?

Current Debt – no current defaults

Student finance – £5770.54 not earning enough yet to pay back

Tesco Loan –       £4867.93 monthly payment £118.73 ends April 2028

M&S CC             £ 6440.30 min payment £161.00

Virgin CC –          £7918.88 min payment £157.94

Barclays CC –     £7391.58 min payment £70.23 0% rate changes soon

Very Account –    £1180.55 – pay later at the moment

Stellantis HP car – £7141.00 outstanding £166.07 per month ends May 2028

Total Debt £40710.00

Currently paying per month £673.97 will increase to approx £763.97 when Barclays rate changes

MONTHLY SPEND

MOBILE PHONE SIM ONLY          £6.00

MOBILE PHONE SON                  £18.34

MOBILE PHONE PAYMENT         £35.96

PET INSURANCE                         £22.93

CAR TAX                                       £16.62

PETOL                                           £45.00

CAR INSURANCE                         £40.00

BUSINESS COST                         £90.98 (MEMBERSHIPS, PHONE, ADVERTISING, NECESSARY COSTS)

LIFE INSURANCE                        £25.81

FOOD                                           £400

CLOTHES                                    £0.00

SUBSCRIPTIONS NETFLIX       £10.99

CCTV SUBSCRIPTION              £10.00

GOOGLE SUBSCRIPTION        £19.99

MICROSFT OFFICE SUBSCRIPTION £7.99

TOTAL £ 750.61

Thankfully I do not have costs for home insurance, gas/electric, phone/internet, water, tv licence, or council tax as I live with my parents, they do not ask for rent but give them small amounts when I can afford it. I will have these costs if I inherit the house.

INCOME

£1091.64 EMPLOYMENT

BUSINESS DOES NOT MAKE ANYTHING YET – NO PROFIT

£459.00 UNIVERSAL CREDIT (THIS MAY END SOON SO WILL LOSE THIS)

CHILD BENEFIT £110.00

TOTAL INCOME £1660

INCOME £1660 MINUS £750.61 MONTHLY SPEND = £909.39

£909.39 MINUS DEBTS MINIMUM PAYMENTS £ 235.42

 

I appreciate any advice, thank you.

Grumpelstiltskin

A few quick answers.

Forget IVA and Bankruptcy.

Open a new basic ( no overdraft ) account with a banking group you don't owe money to.

Separate Business from personal money, do you have a business account?

Being self employed means Stepchange won't help you with a DMP they will refer to Business Debtline

Stop paying unsecured debts, but keep paying the car, when you open the new account transfer vital DDs yourself don't use switch service.

ManyWays

Next year may be very different - no CB, possibly no UC
But at the moment you can make the minimum payments if you just stop buying things, cant you? 

To answer your question about inheriting a house. if you inherit in the first year after bankruptcy, it will be taken to pay your debts and the very large insolvency service fees. If you inherit during an IVA (so 5 years) it will be taken to pay your debts and the IVA fees. So bankruptcy is some risk and an IVA is a much larger risk because it goes on for much longer.

Time2count

I think you also need to factor in money you spend on your son - pocket money, clothes, food at school, school trips etc