Single income, AuDHD, £29k debt, no savings...turning the ship as of 2025!

puffintail

ManyWays said:

You are on the verge of not being able to pay the minimums, with no emergency fund and insufficient in the car maintenance pot, it is going to be hard to maintain that for years.This leaves no leeway to pay more for a consolidation loan to get a neat and tidy one payment a month.
If you can't get a new 0% in March, then any loan to cover the 0%s ending will cost you more a month than the current 0% minimums. At that point I think you need to opt for a DMP. You can do this yourself, and many people will say its better, or go to StepChange where you will get the simplicity of a single monthly payment and not having to talk to your creditors. 

This is the predicament I'm in, and what prompted me to post here. An eligibility checker suggests that I can get a balance transfer card with 0% for 31 months, so that's positive.

RAS

Great. That might give you some lee-way. 

Can you find some money towards the car costs by selling stuff, budgeting hard on food etc (look at the Old Style  Money Saving subforum). You won't pay it all but might make a dent.

I'd suggest that you need to revise your car maintenance allowance and to save this in a separate (budgeting) account with stuff like clothing and medical.

Then in the short-term save what's left into another (emergency) account for maybe 4 months. Thereafter alternate reducing the Lloyds card and adding to the emergency fund? 

Rob5342

puffintail said:

MFWannabe said:

puffintail said:

I’m trying to decide what to do, between instigating the process towards a self-managed DMP, or ‘just’ continuing to try and pay debts each month until it is clear (likely in around 4-5 years…)
I would really value the thoughts of those in this forum – I don’t have any family to discuss this with, and live on my own (with the dogs) so bouncing ideas around with you all will be a great help.

Some additional context:

Single (full-time, public sector) income household, mortgage (in yr 1 of a 3 yr fixed term deal) in my name only. Since buying the house, debts have escalated, between poor car choices, to private diagnosis costs and vet bills not paid by insurances. No missed or late payments, no defaults – essentially, I have a ‘clean’ credit file, albeit low on scoring for my credit utilisation.

I don’t have any emergency funds, and I am in a perpetual loop where I pay money off debt each month, but then I’ll have costs (e.g. I have an upcoming car bill for a new cam belt and brake discs + pads for  c.£1k) which just add on to the debt.

I run (and am a named Trustee and Founder) for a small charity.

Main concerns:

1) having no emergency funds (especially with no family/other backup)

2) debt with 4 different creditors
I’d like to have a single payment for all, as I feel stressed having multiple creditor payments – which may sound ridiculous, it’s owing to Autistic issues and OCD ‘neatness’.
I could get a loan for the majority, leaving the Tesco CC alone as it’s 0%, but that loan would be at 15.6% with Admiral. Good for the NatWest and Lloyds debt, but the Zopa debt is on 9.9% currently.

I could get a loan just for the NatWest and Lloyds debt, this would be 13.5% APR. That still leaves me with 3 creditors, which my mind (annoyingly) still finds stressful.

3) If I brave the stress of defaulting, I could build myself up an emergency fund, and I am comfortable staying with my current lender when the mortgage fixed rate is up (2028) but I’m (probably irrationally) scared to take that leap because I have no family/friends/inheritance etc as last resort back up (and foolishly used credit historically as this ‘backup’)

4) I am not sure as to what impact a self-managed DMP would have on my position within the Charity

SOA:

[font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]

 

Household Information[/b]

Number of adults in household........... 1

Number of children in household......... 0

Number of cars owned.................... 1[b]

 

Monthly Income Details[/b]

Monthly income after tax................ 2592

Partners monthly income after tax....... 0

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

Other income............................ 0[b]

Total monthly income.................... 2592[/b][b]

 

Monthly Expense Details[/b]

Mortgage................................ 665

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

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

Management charge (leasehold property).. 0

Council tax............................. 110

Electricity............................. 70 - This seems high, are you in credit at all? 

Gas..................................... 30

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

Water rates............................. 25 - Are you on a meter? 

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

Mobile phone............................ 32 - When does your contract end?

TV Licence.............................. 0

Satellite/Cable TV...................... 0

Internet Services....................... 35 - This is high, are you in contract? If not check what deals are available in your area

Groceries etc. ......................... 350 (this includes cleaning products/dog food & meds) - Could you shave some off here? £50 maybe? 

Clothing................................ 20

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

Road tax................................ 3

Car Insurance........................... 46

Car maintenance (including MOT)......... 21

Car parking............................. 10

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

Childcare/nursery....................... 0

Other child related expenses............ 0

Medical (prescriptions, dentist etc).... 20

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

Buildings insurance..................... 16 - This is high, shop around for combined buildings and contents when renewal due as should be able to get both combined for this amount 

Contents insurance...................... 16 - See above 

Life assurance ......................... 7  - Don’t think you need this if you’re on your own

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

Presents (birthday, christmas etc)...... 30

Haircuts................................ 20  - Is this correct? Seems high 

Entertainment........................... 30 (this includes Spotify and Amazon Prime)  - Do you really need all these? Do you watch / use them all?

Holiday................................. 0

Emergency fund.......................... 0 - Need to start building this up, if you have the £100 left over every month then start putting it into this 

Fitness................................. 35[b]  - Gym membership? Can you get this any cheaper? Do you use it? If you don’t use it then cancel if you can. If you do use it then I would say keep it as I believe fitness / exercise is good for us 

Total monthly expenses.................. 1786[/b]

[b]

 

Assets[/b]

Cash.................................... 0

House value (Gross)..................... 200000

Shares and bonds........................ 0

Car(s).................................. 1500

Other assets............................ 0[b]

Total Assets............................ 201500[/b]

[b]

 

Secured & HP Debts[/b]

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

Mortgage...................... 128020...(665)......4.74[b]

Total secured & HP debts...... 128020....-.........-   [/b]

 

[b]Unsecured Debts[/b]

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

NatWest CC.....................5092......65........22.9 (0% until March 25)

Tesco CC.......................4400......55........0 (0% until June 26)

Zopa Loan......................19063.....560.......9.9

Lloyds CC......................900.......20........29.9 (0% until March 25) [b]

Total unsecured debts..........29455.....700.......-  [/b]

 

[b]

Monthly Budget Summary[/b]

Total monthly income.................... 2,592

Expenses (including HP & secured debts). 1,786

Available for debt repayments........... 806

Monthly UNsecured debt repayments....... 700[b]

Amount left after debt repayments....... 106[/b]

 

[b]Personal Balance Sheet Summary[/b]

Total assets (things you own)........... 201,500

Total HP & Secured debt................. -128,020

Total Unsecured debt.................... -29,455[b]

Net Assets.............................. 44,025[/b]

 

[i]Created using the SOA calculator at www.LemonFool.co.uk.

Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]

Hi
i have made some comments above in your soa. 

Have you checked the eligibility calculator to see if you can get a new balance transfer card to move all (or as much as possible) of the March 25 cards to? 

Emergency fund: this is the concern for me, because every time I build a little up, it goes because I've had a car related issue, boiler service, vet bill etc

You know you need a boiler service each year so that should be on your SOA with the money put away each month. With the car and vet yoy should assign money for the exected expenses. 

puffintail

RAS said:

Great. That might give you some lee-way. 

Can you find some money towards the car costs by selling stuff, budgeting hard on food etc (look at the Old Style  Money Saving subforum). You won't pay it all but might make a dent.

I'd suggest that you need to revise your car maintenance allowance and to save this in a separate (budgeting) account with stuff like clothing and medical.

Then in the short-term save what's left into another (emergency) account for maybe 4 months. Thereafter alternate reducing the Lloyds card and adding to the emergency fund? 

I forgot that I just signed up for a credit union savings account, from my monthly pay, of £35 per month. 

I have a Starling account now, too, but as soon as I've put some in, it comes back out when there is a big bill... however, I expect I need to just keep trying, because a huge car bill isn't going to come around frequently 

RAS

Presumably, you don't yet have any substantial saving in the credit union? But it means your savings element is automated.

puffintail

RAS said:

Presumably, you don't yet have any substantial saving in the credit union? But it means your savings element is automated.

That's right, I only set it up last month, so there is only £35 in there just now.

I've listed a few things on eBay, only some clothing items, but any extra money is more than the none I have by them sitting around. Thanks for the motivation, RAS 👏🏻

EssexHebridean

Right - the gas/electric makes more sense if it’s dual fuel apportioned out rather than being actual figures. Keep on trying to keep use low, but that monthly figure doesn’t sound too bad allowing for your low level of credit at this stage. 

Your issue is that there aren’t many immediate savings you can make, losing the life assurance is an obvious easy win, you should be able to shave something off groceries I reckon, but then you need to start budgeting realistically elsewhere. Ultimately though you can make the payments currently, which is good, and assuming you are still able to get 0% transfers that is even better.

i would suggest getting that budget fine tuned, starting a spending diary where you note everything you spend (it helps tackle the odd spends you don’t even think about, which often eat into surplus) and start making sure the surplus is initially directed to building an emergency fund, and from there, on to starting to overpay debts. 

Oh - and the credit cards - make sure the payments are set to a little above the minimum payment - this means the same amount goes out each month, the payments don’t drop off as the balance falls so better for budgeting, and of course you chip fractionally more off the balance each month than you otherwise would do! That ONLY works with cards you aren’t spending on though! 

Have a look at eligibility calculators like the one on the MSE Credit Club now to see what chance you will stand of 0% transfers. 

Another suggestion - scratch your “neat and tidy finances” itch by adopting the Tilly Tidy approach. The idea is that each time you log in to your current account you round off the odd pennies from the balance across to a savings account. You can either let that account build up over a year, or each time it reaches a set figure use that to pay off a debt. Means you get the satisfaction of seeing a nice round number on your banking and also get to build up some small savings almost without noticing it! 

puffintail

Really appreciate this, EssexHebridean, thanks. I'm going to do as you say, regarding setting the CC payments a little above minimum.

Looks like I can wrap the Lloyds CC and NatWest CC up in a 0% MBNA CC (0% for 31 months, with a 3.2% fee). So that will leave me with Tesco and MBNA CC's, both on 0% for a good chunk of time, then the Zopa loan at 9.9%. 

I've got a City Save Prize Saver account that I just set up (last month) from my payroll at work - £35 per month before it hits my bank, so I'm aiming for this to be an untouchable (for at least a year) emergency fund.

Then, I'm going to use my Starling account for other small savings pots, to siphon any small amounts left over from the monthly pay, and I'm going to make more effort to sell little bits and pieces here and there (clothes etc) which I'll put straight into these savings pots.

I've started using an "insights" feature on my current account to pin down where/when/what I'm spending on, so that will help.

Appreciate all of the advice, it's helped get me more focused and actually doing things towards a debt-free future.

enthusiasticsaver

If you can balance transfer the two credit cards which lose the 0% in March that should tidy things a bit.  I would set direct debits just above minimums and focus on building savings rather than overpaying debt for now.  When you get to £500 then direct spare money at the credit cards.  Getting the grocery spend down as far as possible by using cheaper pet food,  cleaning stuff etc should bring that down.  If you do not have a big family then I would reduce the present spend and don't buy any clothes for a while. Don't consolidate debt as that makes things worse usually and you need to get out of the habit of spending on credit. Building emergency savings for car costs will help with this. Personally I would not do a DMP if you can get on top of your budget. 

MFWannabe

If you can wrap the Lloyds and NatWest cards up in a new 0% card for 31 months personally I would do it now and not wait until March 
But then make sure once you’ve cleared them on to new card that you close them 

I agree with above; I think you can sort this without a DMP