£68k debt... Time to bring it down... DMP?

Tigzzz

Hey all, I've just spent hours and hours and hours reading a lot of different threads on here. It's put my mind at ease slightly as it's been affecting me a lot mentally recently. I feel I know the basics but just wanted to see if there was any advice for my specific situation.

Nothing unique about how I got here. Overspending in my 20s and early 30s, non stop credit offers and credit increases and then the trap of trying to get out of debt via gambling (stopped now) in my late 30s and here we are a couple of weeks after my 40th.

NatWest loan £10k (taken May 2026) £8.5k left, 7.2%

NatWest CC1 £13k CC2 £7k both 0% till Jan 2028

Lloyds CC1 £10k CC2 £5k both 0% till Aug 2027

Tesco CC1 £9k 0% till April 2027 CC2 £3.5k 0% till Dec 2027

Halifax CC £5k 24%

NatWest overdraft £5k 39%

Monzo overdraft £2k 19%

0 assets such as house or car. Rent with wife. No children. My salary is £4k/m after tax. After paying my share of the rent, bills, all expenses etc, I have around £1.5k left which I use to pay my debts.

Unfortunately this isn't much above the minimum amount for each one as there's so many and I'm not getting any more offers for balance/money transfers which was always my way out (I'm actually happy I can't do the constant transferring).

This gave me the wake up call I needed, as I realised when the 0% deals end, there will be no way I will ever be able to pay them back with full interest.

I've read all about bankruptcy, IVA, DRO, DMP, would it be correct that a self managed DMP would be the 'best' option? As much as I would like us to buy a house it's not happening any time soon due to my debt so I understand for 6 years after the defaults it would be a no go anyway, but at least I would be able to start saving something.

I feel very hesitant about doing the first step - cancelling all direct debits and waiting for the defaults, after never missing a payment or being late paying, in my life. I feel like a failure for not being able to get myself out of the hole I put myself in.

Maybe I just made this thread to be given a kick up the backside to do what needs to be done. Any comments welcome. Thank you.

ManyWays

Thanks for starting with such a lot of details. But we can't say much about what your options are without a bit more.

Can I ask if your wife also has debts? Does she know the extent of yours?

All the 0%s ending are a way away. So this is a good time to think about your options but no need to rush.

Could you fill out a Statement of Affairs firm and post it here please. Our preferred format is here https://www.stoozing.com/soa.php

sourcrates

"I feel very hesitant about doing the first step - cancelling all direct debits and waiting for the defaults, after never missing a payment or being late paying, in my life. I feel like a failure for not being able to get myself out of the hole I put myself in".

A failure?

Not at all, you have been a slave to the banks for long enough, they reel you in with all those tempting little offers, its akin to being released from a religious cult, you have broken the chains that tied you down, and are about to find financial freedom at long last.

A failure my !!!!!!, you are about to take the first step in freeing yourself from the credit trap, you should be feeling proud as your at last re-taking control of your own finances.

fatbelly

I wonder if you are focusing on a dmp as if you have a moral duty to repay these creditors You have no such thing. When we see your soa we can help you decide which strategy works best for you, not them.

Tigzzz

Firstly thanks for your replies. I've spent the past week and many many hours reading, researching and more reading. Mainly to increase my knowledge about the process and find answers to questions that have already been asked before to save asking again. Feel like I've read nearly all the DMP threads on here! Also to figure if there was any alternative, but bar bankruptcy everything points to DMP.

https://forums.moneysavingexpert.com/discussion/comment/82158973#Comment_82158973

My wife knows the extent of my debts and is very supportive. I spent A LOT of money supporting her and on us meeting up, before she came here on a spouse visa (expensive!) 18 months ago, so she's willing to help me clear my debts. Unfortunately, she now has £6k (2 x £3k) of credit card debt, which is because of me. A month ago she got her first ever credit card offer from Natwest after working full time for a year, and I jumped at the chance to do 0% balance transfers from a couple of mine as I suddenly wasn't getting any more offers, when I thought I could still keep juggling everything. £3k she already owed me, so I guess technically I owe her £3k. These are 0% for 18 months, so the plan is in around 6 months, she will start paying £500/m to clear them. I'm now trying my hardest for her to never be in my position. She earns around £2.5k/m after tax. We split most things 60/40. For the purpose of SOA it will be just my personal costs as I will be the only one paying my debt so I won't include her income or her part of the bills etc.

https://forums.moneysavingexpert.com/discussion/comment/82159093#Comment_82159093

Thanks for the kind words. You're right. I'm still getting loan offer showing on my Natwest app right now even though all my accounts with them are maxed. Constant balance and money transfer offers from all the banks, I actually felt like I had unlimited credit. Spending was never a problem at the time as it was just one transfer and the money was back. I guess the feeling of failure is because I knew exactly what they were doing, but still fell for the trap.

I've been in some sort of debt since the first day I got my student bank account with overdraft and student credit card. My dream for many many many years has been to get paid, and have that full amount to do what I want with. Not have to pay x amount to debts and then only be left with y. After all these hours of reading I'm actually weirdly excited to start this first step. I can't wait for the day when my dream comes true.

https://forums.moneysavingexpert.com/discussion/comment/82159164#Comment_82159164

You're absolutely right. For example Natwest is my OG bank so it feels 'wrong' to not pay everything back, but I understand I'm just an account number with a balance and there should be zero emotion involved, its all just business.

I will put up my SOA in a new post.

Tigzzz

Couple of points - I get paid 4 weekly, so this is the monthly equivalent but in reality its £300 less every 4 weeks. Yes there is a 13th pay at some point in the year to make up for it but it makes budgeting a little bit trickier.

The 0% deals as mentioned all run out at some point between March/April next year and Jan 28.

All my debt d/d went out over the last couple of days and I get paid this coming Wednesday. I will be opening bank accounts with unrelated providers this week so for next month I can cancel everything and keep my pay seperate.

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

Monthly Income Details[/b]
Monthly income after tax................ 4000
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0[b]
Total monthly income.................... 4000[/b][b]

Monthly Expense Details[/b]
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 1100
Management charge (leasehold property).. 0
Council tax............................. 120
Electricity............................. 35
Gas..................................... 35
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 0
Mobile phone............................ 20
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 25
Groceries etc. ......................... 600
Clothing................................ 50
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 200
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 30
Pet insurance/vet bills................. 20
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 25
Presents (birthday, christmas etc)...... 100
Haircuts................................ 45
Entertainment........................... 200
Holiday................................. 100
Emergency fund.......................... 0
One off stuff........................... 100[b]
Total monthly expenses.................. 2835[/b]
[b]

Assets[/b]
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0[b]
Total Assets............................ 0[/b]
[b]
No Secured nor Hire Purchase Debts[/b]

[b]Unsecured Debts[/b]
Description....................Debt......Monthly...APR
Natwest CC1....................13500.....300.......0
Natwest CC2....................7200......72........0
Natwest Loan...................8500......365.......7.2
Monzo Overdraft................2000......32........19
Tesco CC2......................3400......34........0
Tesco CC1......................9600......105.......0
Halifax CC.....................6000......102.......28
Lloyds CC2.....................5300......132.......0
LLoyds CC1.....................9800......250.......0
Natwest Overdraft..............5000......145.......39[b]
Total unsecured debts..........70300.....1537......- [/b]

[b]
Monthly Budget Summary[/b]
Total monthly income.................... 4,000
Expenses (including HP & secured debts). 2,835
Available for debt repayments........... 1,165
Monthly UNsecured debt repayments....... 1,537[b]
Amount short for making debt repayments. -372[/b]

[b]Personal Balance Sheet Summary[/b]
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -70,300[b]
Net Assets.............................. -70,300[/b]

[i]Created using the SOA calculator at www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]

Smudgeismydog

Thanks for posting your SOA, I have a few observations;

• £600pm for groceries is high for 2 of you in the household, Do you shop with a list? Can you reduce this by batch cooking, changing brand/supermarket?
• Is the £1,100 your share of the rent or is that the full rental payment?
• Clothing at £50pm whilst not a big figure can be reduced by using Vinted, ebay or charity shops, and do you have anything you can list to bring in additional funds?
• £100pm for presents is unaffordable, who do you buy for? Can you suggest something like Secret Santa for close family? Or just buy for kids in the family who are under 18/21?
• £45pm haircuts also stands out, can you reduce this?
• Entertainment, Holidays and ‘One off’ stuff totals £400pm, yet you have nothing allocated for an emergency fund. Perhaps the ‘one off’ money should be reconsidered as emergency fund money to cover the unexpected bills. As you will be living without access to credit, it is really important to establish a pot for unexpected costs.
• You didn’t include contents insurance, does your wife pay for this, or do you not have it?

Hope this helps

fatbelly

Your choice is between a debt management plan and bankruptcy.

II think technically you could shave 372 off your expenses and carry on as you are. But I sense that is a difficult option to live with long term

Bankruptcy has an advantage in that you will only be required to contribute from your income for three years. But it would not clear any joint debts or debts in your partners name. And it is a formal solution that you may have to declare if ever asked.

A dmp on the face of it is going to take 60-70 months.

II think I would suggest a sort of dmp hybrid where you do not offer creditors your full surplus but save on tbe side. Then after 2-3 years check enforceability and make settlement offers

RAS

Agree with all Smudge's comments but am a little confused about the splits.

If you split most stuff 60/40, are these just your portion of the joint bills? If so, £1k for groceries and £750 for presents, ents, holidays and stuff is very high. I'd suggest that you like more closely at what that random stuff is and if it's predictable but infrequent get money into a separate "budgeting" account so it stops surprising you.

Do you have stuff that you no longer use? Would a clear out and some sales raise a bit of money to start knocking back that awful Natwest OD.

I'd not suggest going full bake beans on toast, but maybe look at look at the pricier end of Wearywolf Adventures and at Backyard Chef. The latter does a recipes from wider range of countries, both do simple flatbreads and quick curries, pasta and soups. Somethings like spending the price of a KFC on ingredients for 5 meals are worth thinking about.

Maybe one month more budget and the next more relaxed could help you without requiring the hair shirt?

Tigzzz

https://forums.moneysavingexpert.com/discussion/comment/82165852#Comment_82165852

• No list and food is one thing I never cared about the price too much, in the sense that I was willing to pay more for better quality food as I think it's important. Saying that, for this month I've cut out a lot of unnecessary foods, mainly snacks etc, so I'm working on bringing it down. Wife is the cook and she does most days. Also £5 a day on food at work for lunch. Need to find the time to prepare it beforehand at home.
• My share of rent.
• I'm not into the 2nd hand clothes market if I'm honest, but I always do look for discounts.
• Presents was more of a rough figure but yea won't be spending a lot on gifts going forward. Most of the spend would be for a small holiday for the wife on her birthday.
• Haircut/shave every 3 weeks at £30, can't really change that.
• Completely agree, this would be for emergency fund.
• No contents insurance. I didn't realise can get it for less than £10/m, will look into it.

https://forums.moneysavingexpert.com/discussion/comment/82166011#Comment_82166011

Sorry should have clarified the 60/40 split is for rent and bills. The rest is more adhoc. I might pay £50 for a big shop but then she would pay £10 grabbing a few things after work etc. Also household stuff and everything for our cat I would normally order it all myself.

You're completely right, my relationship with money and spending it is/has been very bad. We moved 6 months ago into an unfurnished place and I had no problems spending about £5k on furniture and new TV etc, without even thinking if it's affordable, as it would be on a credit card and something to only think about in a few months. The Natwest OD annoys me so much, but working on it. Will start doing overtime at work again after stopping it a couple of years ago.

Tigzzz

https://forums.moneysavingexpert.com/discussion/comment/82165955#Comment_82165955

I definitely could cut down the expenses and carry on as I am. The problem is when these 0% deals run out next year, the minimum payment will shoot up to amounts I won't be able to cover.

My wife's debts shouldn't be an issue to pay back for her, they won't be increasing that's for sure. Having to answer yes to the question if ever asked is the main thing putting me off bankruptcy. If I had to pay it for 3 years, how much do you thing would be the minimum they would accept? £1k/m or would lower be possible? If yes that would mean ~£36k paid back.

That was my plan regarding the DMP. I sort out my expenses, pay £500/m towards all creditors (less if possible), bank £1k/m. After 2 years ~£12k would be cleared and ~£20k in bank. I then start making offers, hopefully settling for ~30% so the £20k I've got to clear the remaining £60k. Then I can save properly going forward and have enough for a deposit and be OK to get a mortgage after the 6 years.

Just not sure if the potential £4k saving of going via DMP vs bankruptcy is even realistic, as it's hard to predict what exactly will happen with the creditors, or just stick to the bankruptcy as that would be a certainty in the amount to be paid back, and live with the harsher short term consequences.

///Edit been reading and researching about BR and there's a lot more reasons it would be better to avoid it, the informal DMP approach I would be a lot more comfortable and happy with, I think.

@sourcrates do you mind if I ask for your opinion as well on the best way forward and whether it's a viable DMP plan?