Terrible debts..need advice please....

OVERSPENDING_IDIOT

Hi all.... I need some advice here..

Over the past ten years or so I've managed to get myself into some serious debt, unfortunately I've only just realised! Too much shuffling credit card balances around for 0% or low interest deals, consolidation loan etc but probably burying my head in the sand & not facing up to the figures & the problem, until now.
Last week I sat down with my credit card statements & added up what I owe - almost £45,000 plus I have £23,000 of a loan still to repay. I was shocked when I realised that I'd got almost £70,000 in debt.
I considered myself as having a decent income & capable of paying debts off but I had no idea exactly how much I was in debt. Now almost all of my income is spent on paying credit cards & my loan, the remaining money from last months wage lasted a week, after I'd paid all my payments. I re-spend on credit cards to get through the month. I'm stuck in a vicious circle.
I have 9 credit cards, an unsecured loan & I'm not a home owner, nor do I have savings or assets. What do I do to solve my problem??

Each month I take home £1900, my approx. outgoings before paying debts are:

Rent £220
Council tax £60
Gas £120
Water £25
Electric £80
Housekeeping £500
Clothing £250
Car/Maintenance/Fuel £350

TOTAL = £1605 £295 spare

chevalier

Each month I take home £1900, my approx. outgoings before paying debts are:

Rent £220
Council tax £60 Is this with single persons discount? A cheap area of the country? You can ask to pay it over 12 months rather than 10 to spread the load
Gas £120:eek: :eek: Is that for a MONTH? If so that is really really high. Or does it include arrears? If not then turn the heating thermostat down to 19 degrees C and put a jumper on. Also check that your hot water heater is not turned up too high, if the water comes out the hot tap so hot that you have to put cold in it then it is set too high.
Water £25
Electric £80 Again this is very high. Are all appliances switched OFF when not in use? Ie NOT left on stand by? Eg your tv uses almost the same electricity in stand by mode as it does when turned on.
Housekeeping £500 Again if this is you on your own then WOW! This is my house keeping for a family of four + 2 cats for 2 months! Lots of scope for cutting back on ready meals, meal planning, sticking to shopping lists, and buying star drops for cleaning. Have a look at the money saving old style forum on this site for lots of tips to trim this area.
Clothing £250 This is why I think you have more than you in the household? If it is you on your own, then if you have been spending this much on clothes for any length of time, then you won't need anymore for a while, so trim this back to essentials (ie underwear only). One trick someone told me was to iron the ironing pile and then hang it all up in cupboards. This will show you how much clothes you have, and also reminds you of all those clothes you have forgotten about. That way you know you have x top to go with y bottoms, and not think I have nothing to go with y I will have to get something.
Car/Maintenance/Fuel £350 Again this is very high. Is it a fuel guzzling car? Or does this cover a car loan, plus the maintenance and the fuel.


TOTAL = £1605 £295 spare So you have £295 over each month, yet you said in your post that you live on your cards after the first week. So you need to track your spending to see where this goes. Keeping a spending diary can be a real eye opener. Any old notebook will do, and then write down EVERYTHING you spend on. Even the coffees etc. It will give you a good handle on where you are frittering!!

You also have not got anything budgetted for
Car Insurance or MOT
Contents Insurance
Dental, medical or optical costs
TV licence
Sky/Virgin
Broadband
Mobile
Landline
Birthdays and Christmas savings

Could you also note down your debts with the APR total amount and min payment? This way we might be able to see what you need to target first.

best of luck
chev

OVERSPENDING_IDIOT

Yeah we're puttin £30 a week on the meter, it's shocking! :mad:

MissEyre

What does housekeeping include? And have you bought anything you can sell with the money, or has it all just disappeared?

OVERSPENDING_IDIOT

housekeeping is general expenditure but mainly shopping for food.
I've nothing other than a car that i've bought which i need for work, it's only worth about £5000 anyway. Most of it has just disappeared.

MissEyre

Your fuel bills are extremely high-I know that payment meters are more expensive, can you ask to move to a regular tarriff/cut down your usage (low energy everything, obsessive light switching off, charging your mobile at work etc) as you really need to get this reduced-your utlities charges are currently costing you more than your rent each month, so getting this down would be a major help

MissEyre

How many of you are there? Just you/you and a partner/you and partner and kids etc..

OVERSPENDING_IDIOT

there's myself, partner & one 4yr old. we are trying to get off the meters as weve realised that it's costing us a fortune. I've also being turning lights off like a man possessed!

Mrs_Sparkle

Hi and welcome! You're in the right place for help. Your clothing expenditure seems very high, can you cut this right down and use the amount you save to chip away at your CCs?

OVERSPENDING_IDIOT

Thanks for all your tips Chev, you're right there's some things that I haven't budgeted for & some figures may be slightly higher than the actual costs but generally I end up with around £300 per month after the essential outgoings. We've a 4yr old that's growing quickly & goes through shoes & clothes very quickly, the car's not a petrol guzzler but I travel alot to/from work so I use around £60 per week.

MissEyre

OVERSPENDING_IDIOT wrote: »

there's myself, partner & one 4yr old. we are trying to get off the meters as weve realised that it's costing us a fortune. I've also being turning lights off like a man possessed!

Good start, you've got some top tips from Chev already, and probably the biggest change you will make now is actually thinking about where your money is going, instead of spending it then realising it's all gone-I know it has made a huge difference to me and my budget.

Your housekeeping can certainly be halved with a bit of thought-there is another board on this site called Moneysaving Old Style, where you can pick up some fantastic tips, and they run a monthly Grocery Challenge, where you set yourself a personal challenge to keep your household shopping within a certain limit. If you are currently spending £500 a month, try cutting back to £450, then £400 the following month and just keep reducing until you are comfortable with the new limit. I'd recommend having a look over there.

It is also a good idea to look at www.whatsthecost.com for something called a Snowball calculator-fill in all the details of your debts, and it calculates your debt free date for you, then which payments you need to make to clear the debt as soon as possible. Yo can then play around with the figures when you have extra money to throw at the debts to bring your debt free date closer-can be a real boost!