In debt, unemployed and need help

IhateDebt_3

Hi all,

Ive been struggling with debts for a few years now and its time to get some solid advice.

Ive made up a little run down of debts, expenses, income etc to give people a little background info.

Debts:

Halifax One
total £3729.81
min payment £74.57
Interest
bal transfer 12.94% £19.43pm
Purchases 12.94% £2.16pm
Cheques 21.95% £5.87pm
Bal tranfer promo 3.8% £4.13

Natwest
Total £2510.25
Min payment £56
Interest
Purchases 17.4% £36.17pm outstanding £1352.14
Cash 18.36% £17.78pm outstanding £1157.78

Virgin
Total £1237.36
Min payment £18.82
Interest 13%

Outgoings:

Rent £120pm living with father in council house (no rent/CT to council while not working but will have to pay £55pw rent and £15pm CT when working thats on top of the £120pm to my father)
Food £100pm
Phone/net access £25-30pm in 18month contract
Mobile £30-40pm in 12 month contract
Life assurance policy £20pm
car tax £10pm
car insurance £31pm
petrol £25pm
Car maintenance??? £12.50-£25pm
clothes £20pm
socialising/goin out £100pm
Entertainment(cinema, concert) £30pm

Total £526 not including debt payments which adds another £150 if I just pay minimum payment.

Income:
JSA £220pm unemployed for 6 months and struggling to find work.

Been paying bills by selling personal items i.e pc parts, dvds these items coming to and end now so wont have that extra to pay things with.

Lots of unskilled low paid work in my area i.e warehouse work, usually 40 hours @ £4.80 == £768pm before tax and NI. If I take 1 of these jobs im still not paying more than minimum off my debts. I have been off work in the past with back/knee/shoulder injuries so these types of jobs arnt really suitable for me long term.

I normally do IT computing work but this has dried up in my area and competition for jobs is very high. I cant see myself getting a well paid job anytime soon so im just looking for the best job I can find to get me by.

Thinking about goin bankrupt and just starting afresh. Im trying to get out of my father's council house and get a place with my parnter unfortunatley its the debts thats holding me back.

Any advise is welcome.

Regards

bonnie_2

why are you spending 150 pound a month on clothes and entertainment when you havent any money, i think you need to do some thinking seriously car, phone ,internet when you only have 220 coming in a month.why do you need life insurance if you havent got a mortgage, ive never had any.it costs 310 pound to go bankrupt and would affect all sorts of things ie future mortgage, bank accounts etc. sometimes we have to admit that we have no money and give up the nicities in life to get back on the straight and narrow.i only spend 200 a month on food for 4.and we only go out if something is free.

Fran

The first thing you have to do is accept that while on £50-odd per week you can't afford the £40-odd that you use for "clothes, mobile, socialising & entertainment". That's without even mentioning the car! It will never add up as clearly you can't pay bills etc. with only £10 per week left out of your money. The above things are not essential and for instance you should only use your mobile in an emergency, you can do without new clothes for now, you will have to cut right back on the socialising and entertainment (find some that doesn't cost this). You just can't afford the same lifestyle as before and while you're in this situation you have to face exactly how little money you have each week.

Why don't you pay any towards your father's council house? I think it's right that even if you're unemployed you have to pay a minimal amount unless you fit into certain categories (eg. a young age).

Have you got the cheapest car insurance (check article on this site on main page)?

IhateDebt_3

£20pm on clothes is only £240 a year, I dont spend it every month just divided what I roughly spend a year by 12. As for the statement "you can do without new clothes for now," I cant as my shoes have holes in them and I need to replace them. I shop at matalan and lidl so they are hardly expensive clothes.

As for the mobile and house phone they are fixed monthly contracts and I have needed them in the past to get work. I cannot cancel them as im still in the contract.

The life insurance if for my father not me, funerals are expensive and the reason for some of the debt is that I had to pay for my mothers funeral last year.

@Fran "Why don't you pay any towards your father's council house? I think it's right that even if you're unemployed you have to pay a minimal amount unless you fit into certain categories (eg. a young age)."

What do you think the £120 a month is for, thats goes to him. If im working I also have to pay to the council as he loses his housing/CT benefit.

I NEED the car as I wont stand a chance of getting any work without 1, its an old rover 100 so its the cheapest possible car I could have and run.

The £25pw socialising is'nt me going out getting drunk its mainly trips to the coast with my missus, I even take pack lunches so we dont have to buy food there. The petrol costs in her car add up to nearly £40 pw so I have to contribute towards this.

IhateDebt_3

Its the debt thats the problem not my monthly outgoings, when im working I can cover those easily.

It looks like I will have to take a low paid job so I need advice on how to best pay my debts while im on a low income. Its easy to say cancel phone, get rid of car and stay in all the time but that has other repocusions such as lessening my chances of getting work and increasing my chances of getting depressed and wanting to end it all.

Kimberley

Have you talked to your local CAB? or these https://www.cccs.co.uk

tru

My monthly outgoings were covered too, it was the debt repayments I couldn't afford. That is, until I stopped spending money on clothes and entertainment. You think you need these things but you don't. I only replace clothes when I absolutely have to (I shop in Matalan too, I don't spend more than £60 a year).

You have to stop spending so much, it's the only way to do it.

Fran

IhateDebt wrote:

Its the debt thats the problem not my monthly outgoings, when im working I can cover those easily.

The point is though that you are NOT working and you CAN'T cover them. You will have to face this first and cut out unneccessary spending or there's no point in people advising you what to do!

Its easy to say cancel phone, get rid of car and stay in all the time but that has other repocusions such as lessening my chances of getting work and increasing my chances of getting depressed and wanting to end it all.

You only need to use your mobile in emergencies which could also include a job interview offer reply because you can't get home for example. At the moment, you have your home phone for calls which you are paying for too (do you split this with your father?)

Not buying clothes and not spending the same on entertainment and socialising is essential (have you made these into 2 categories to justify them to yourself?). You will have to stop spending first or your debts will just get worse.

Kimberley

We all have to make sacrificies sometime..Have you thought of paper rounds which are cash in hand or car washing? Just a thought..

Fran

Kimberley wrote:

We all have to make sacrificies sometime..Have you thought of paper rounds which are cash in hand or car washing? Just a thought..

That is ok if s/he is on contribution-based JSA but as he has been unemployed for 6 months he is likely to be on Income based JSA. With that you are only allowed to earn £5 per week or it affects your benefits. "Cash in hand" above this amount not declared to Jobcentre is fraud (a criminal offence).

IhateDebt,
You didn't reply to my question re Housing/Council Tax. (?????)

IhateDebt_3

My debts arent getting worse as I dont use my cards, ive been paying £300-400 per month off them up until recently.

My phone is the standard charge no more. It wont be any cheaper by not using it. I pay for ntl broadband and get the phone line at home for free.

As for not goin out, well thats the only pleasure I have in life so im hardly going to give it up without a fight.

@troo if you only spend £60 a year on clothes you must look like a proper tramp. A pair of shoes is £20 and jeans are £15 a pair. I think what I spend is a very small amount and I only just look decent and respectable.