an ever decreasing circle of debt

redrolo

Hi all,

I am new to the forum although I have been reading the threads on here for a few months. I suppose I have lived in denial for some months now, although my spouse is still to 'smell the coffee'. We are in an ever decreasing problem: we spend more than we earn, but to be honest its not on any luxuries. The debt has come largely from moving house 3 times and 3 years and putting it on the plastic. When my wife was pregnant a couple of years ago we sold the second car. Now however, before I realised the problem, we have got a car on PCP at £320 a month. .

A summary of our SOA:
Income - £4022 per month (inc £550 rent from second home) Can't sell it as redemption penalty is £8000 for next 12 months

Outgoings
Home - 2286 (mortgages 1800)
Eating - 550
Transport - 131 (I have a company car, so this is for my spouses travel only)
Debt repayment - 1086 (from car, credit card debts of £10k and loan of £7k)
Haircuts, dental insurance, contact lenses £70 per month
Big one offs (birthdays/xmas) 83
clothes daughter 40

Anyone give any advice. Would anyone consolidate all of the loans and cards into one loan, as all i do is shift the debt when the 0% is over.

Is it any benefit sending the car back, or will i get hit by redemption penalty.

On the plus, my wife is due for a new promotion in September which will be an extra £600 after tax. i have sent letters to the bank and mortgage providers to start the claim back process.

i am worried that my debt to others is so high, and I can't afford to buy any needy items for myself or my family.

Thanks for reading

debrag

redrolo wrote: »

A summary of our SOA:
Income - £4022 per month (inc £550 rent from second home) Can't sell it as redemption penalty is £8000 for next 12 months

Outgoings
Home - 2286 (mortgages 1800) - how much is gas, electric, tv, phone etc
Eating - 550 - this can be cut down
Transport - 131 (I have a company car, so this is for my spouses travel only) - why so much
Debt repayment - 1086 (from car, credit card debts of £10k and loan of £7k)
Haircuts, dental insurance, contact lenses £70 per month - this can be cut down
Big one offs (birthdays/xmas) 83 - cut this down
clothes daughter 40 - does she really need this every month

I'm commented in red. I wouldn't get a loan maybe you should talk to CCCS or payplan but it would be easier for us if you list all your household bills

squirrel_pigeon

Hi redrolo. Welcome

Would you be able to break your SOA down into a bit more detail? Have a look at some other threads to give you an idea.

People will also want to know individual balances, APRs etc for your debts.

I personally would avoid consolidation but that's only because I was stupid and didn't cut up my cards after I took out the loan... I would think very, very hard though if you were considering taking a secured loan.

You would need to check the agreement for your car as no agreement is the same.

Have a go at breaking your SOA down into more categories and I'm sure people will be able to help you.

Have you thought about contacting one of the debt charities, CCCS, NDL or CAB? They will give you a free, impartial take on your situation and no matter who you call they will help you get things in order.
xxx

Tustastic

Hi redrolo, well done for finding your way here - it's a great support network. Why not look at the car paperwork and find out whether there is any redemption penalty, then decide on what to do next?
£550 on 'eating' is very high, even for a family. There are people on here who feed families of 4 - 5 very well and healthily on much, much less. Have a look at the Old Style board on here for brilliant advice on shopping, menu planning etc.
Keeping a spending diary -I found it really tedious but boy do you find out where the money is leaking from.
Welcome

redrolo

debrag wrote: »

I'm commented in red. I wouldn't get a loan maybe you should talk to CCCS or payplan but it would be easier for us if you list all your household bills

Wepay £100 a month through Scottish Power for combined gas/electric. Have applied for British Gas combined
£28 sky TV (inc. £10 multi room).
We have loans/credit cards outstanding as follows:
Halifax 7.9% loan - £7k to pay
Virgin 0% for next 12 months - £8.5k
Egg 0% for next 4 months - £1.5k
Council tax £170
Food shopping - £250 per month
Works eating - £20 per week

The car travel is from 2 full tanks of petrol a month

debrag

are you sure you're getting the cheapest petrol? wheres the MOT, TAX, Insurance?

Take food from home to work and save the £20

Do you not have a phone or have I missed that?

redrolo

squirrel_pigeon wrote: »

Hi redrolo. Welcome

Would you be able to break your SOA down into a bit more detail? Have a look at some other threads to give you an idea.

People will also want to know individual balances, APRs etc for your debts.

I personally would avoid consolidation but that's only because I was stupid and didn't cut up my cards after I took out the loan... I would think very, very hard though if you were considering taking a secured loan.

You would need to check the agreement for your car as no agreement is the same.

Have a go at breaking your SOA down into more categories and I'm sure people will be able to help you.

Have you thought about contacting one of the debt charities, CCCS, NDL or CAB? They will give you a free, impartial take on your situation and no matter who you call they will help you get things in order.
xxx

Thanks for the welcome. I was considering going into the bank to discuss it. we have an overdraft (which I forgot to mention) of £3500 which is giving me sleepless nights.

squirrel_pigeon

Have a chat with one of the debt advice agencies first. They have your best interests at heart whereas the bank will more than likely offer you a loan which unless you're very strict with yourself and your spending, you won't be able to afford. Take it from someone who knows...

When you talk to someone and get it all out in the open, you'll feel much better. They may even be able to help you manage your budget so that you can afford your contractual payments.

Good luck
xxx

redrolo

debrag wrote: »

are you sure you're getting the cheapest petrol? wheres the MOT, TAX, Insurance?

Take food from home to work and save the £20

Do you not have a phone or have I missed that?

The petrol is basically to cover my wife over the 4 weeks. She works in Manchester 3 days a week and we live in leeds. the tax is £95 a year. I have a company mobile and my wife only has one for emergencies.

Thanks

mummytofour

Is there anyway way you can up your income? Could your wife earn more?

redrolo

mummytofour wrote: »

Is there anyway way you can up your income? Could your wife earn more?

Hiya, thanks for the reply. I used to be in a job, where I got bonuses and if I needed any extra cash I could work overtime. I have moved to a flat based salary job. I am doing a masters degree to try and make the move out of my current company (been there 17 years).

My wife is in education and her promotion is not due til september.

I have been selling allsorts on ebay to try and reduce the current burden. I didn't realise the problem was as big as it is until I did the SOA on here :eek: