£31,000 Credit Card Debt and My Anxiety is Unbearable

kimwp

It's not a matter of whether the creditors will accept it, it's what you can afford (and they have to accept that)

How many cars does that car insurance cover, it seems very high?

husnu1

Grumpelstiltskin said:

OK That's  better. Car  expenses look high, how old is the car? Life insurance, high as well.

I know you are catering for 4 adults but groceries look high, do you use the cheaper supermarkets? own brands or expensive brands, shop when reductions are being made?

The car is four years old, and the insurance is quite high mainly due to the area I live in here in London. We do shop at the cheaper supermarkets already, and while I’ll definitely look at reducing that further in the future, I didn’t want to underestimate it and end up struggling later on.

Of course, as time goes on, I’ll be looking for more ways to cut expenses so I can clear the debt faster.

Do you know if creditors generally accept the SOA as it is, or are they likely to challenge certain parts of it?

As I indicated earlier, the last payment I made to my creditors was in February, and I missed the payments for March and April.

Grumpelstiltskin

Today with all the publicity all over the media is the ideal day to tell the family things are going to change as every bill is going up more than wages so they should get onside.

RAS

You don't need to answer these queries here but just checking.

Do you have any shared financial accounts with your spouse, other than the mortgage? If so, you need to close them to sever the financial association.

Does your spouse know and understand the full debt situation?

Have you opened a new basic bank account (no credit check) and transferred (not switched) your income and essential DDs to the account?

Any chance your spouse could increase their hours, get a better paid job?

That £426 needs to go straight into a savings account as soon as your salary hits the bank. For a home owner your emergency fund is inadequate and you will have stuff like gutters, domestic appliance failure and the car to sort out. 

Your adult children are adult now. They need to understand that you are going to be limited as to how much you can support them going forward. So they need summer jobs, even if they can't do much work in term-time (some courses have placements etc).

Given the family is London based, they need to look for permanent work before they finish uni and to start contributing to that very high food budget and the utility bills, and paying their own media etc.

husnu1

kimwp said:

It's not a matter of whether the creditors will accept it, it's what you can afford (and they have to accept that)

How many cars does that car insurance cover, it seems very high?

I am embarrassed to say it, but the car is 4 years old, and the insurance is high because of where I live in London.

Martico

husnu1 said:

I'm sorry, everyone. I will check my SOA, redo it, and then post it again. I think I made some mistakes because I panicked. I just can't for this to be over so that I can start living an everyday life again.

There's nothing at all to apologise for - SOAs are horribly difficult to get right first time, even for people without any stresses in their life. Yours is one of the better ones I've seen, and anyone pointing out inconsistencies or potential issues is only doing so to help you reach as clear a picture as you can, and is not seeking an apology  

RAS

Martico's right. The biggest problem with SOAs is that many people vastly underestimate the amount they, miss many of the annual payments out altogether, etc, etc. You seem to hit the items but maybe put an annual rather than monthly cost? 

One small tip, in addition to the savings/emergency fund, have what I call a budgeting account. Tot up the monthly amount you've allocated for annual spends, whether that's presents, car repairs or tax and transfer that to the budgeting account each month. Then when you've an annual bill to pay, most if not all of the money is sitting in the budgeting account.

husnu1

RAS said:

You don't need to answer these queries here but just checking.

Do you have any shared financial accounts with your spouse, other than the mortgage? If so, you need to close them to sever the financial association.

Does your spouse know and understand the full debt situation?

Have you opened a new basic bank account (no credit check) and transferred (not switched) your income and essential DDs to the account?

Any chance your spouse could increase their hours, get a better paid job?

That £426 needs to go straight into a savings account as soon as your salary hits the bank. For a home owner your emergency fund is inadequate and you will have stuff like gutters, domestic appliance failure and the car to sort out. 

Your adult children are adult now. They need to understand that you are going to be limited as to how much you can support them going forward. So they need summer jobs, even if they can't do much work in term-time (some courses have placements etc).

Given the family is London based, they need to look for permanent work before they finish uni and to start contributing to that very high food budget and the utility bills, and paying their own media etc.

Thanks @RAS. I will try to answer as best and honestly as I can.
1/ We only share the mortgage. Everything else is in my name.
2/ I have not opened another basic account as my bank Barclays is not one of the creditors. Do I still need to open another bank account?
3/ At the moment, no, but in the future, she will look to increasing her hours or finding a better-paying job.
4/ Why does the £426 need to go into another bank account? How much do you think the emergency fund should be? (God, this is hard.)
5/ I have talked to the children, and we will do our best, but I need to sort this out with my creditors first. This is what's panicking me. We will all look into improving things.

Grumpelstiltskin

As has been pointed out it will take many months before you sort out all your creditors, so don't wait to tell the children, the sooner they understand money doesn't grow on trees the better. It will help them when they do move out if they understand household finance.

husnu1

Grumpelstiltskin said:

Today with all the publicity all over the media is the ideal day to tell the family things are going to change as every bill is going up more than wages so they should get onside.

Of course, you are 100% right. I am slowly telling my family everything, and we will all try to make things better for the future. I never want to be in a similar situation again, but I need to sort out what to do next. Shall I contact Stepchange or do it myself? Most people here and in some Facebook groups seem to favour doing without going to Stepchange. What should my option be? I don't want to go into IVA. Shall I go into DMP? Oh, god, I am confused.