As my user name says Enough is Enough (help wanted)

Enough_is_Enough_4

Ok so i’ve decided enough is enough. I have got to the point where I owe £23,000 to various loan and credit card companies. I have a decent job and a few friends and a wonderful girlfriend. I am fed up of waking up every morning counting the days until payday when I can pay off “just a little more” of this £23,000. But as we all know it’s going down so slowly that I have had enough of it.

My girlfriend and I want to move to a bigger place soon, and it really hit home how bad my situation is. We currently own our own flat and we comfortably afford the mortgage and bills (she works full time aswell) and I do afford all my repayments every month. But it leaves me with about £200 for petrol and social. My petrol bill is about £100 per month so not much left. I cannot remember the last time I took my girlfriend out for a nice romantic meal. L

So I’ve decided to get an extra job to pay this all off as quickly as possible. It may only be delivering pizza’s in the evenings but it will all help, and I’ve come up with a plan and want people’s views really.

If I can earn what I think I will earn with the extra job, I will be brining home about £2,300 per month (its going to be hard graft but I’ve got myself into this mess and I damn well going to get myself out of it – even if it does mean working 15 hours a day!)

After I’ve paid off the minimum on everything I will be left with about £850. I am going to take £300 of that and put it on a pre paid debit card for myself to spend on Petrol and socialising (too much?)

So that leaves me with just over £500 to smash my debt with per month. Now that is where you guys come in.

Is it best to put that £500 into a savings account that will earn interest, then when there is enough in there pay off the lowest (£1,500 Natwest Credit Card) then start again until I have the Next amount to pay off my MBNA etc etc.

Or is it best to pay off slightly more of every debt per month? Say where I was paying £50 on my natwest card I will pay £100 and so forth.

Advice wanted please.

I don’t need to actually pay off the whole amount (although that would be great and I’m going to work hard to try to achieve it) but our flat has increased in value and when we do sell it, it will be for enough that I could clear the remainder. Obviously I want that remainder to be as little as possible.

It sounds weird, but I am so proud of myself for finally fronting up to the debt, getting off my bum and doing something about it. I have fibbed to my girlfriend about it in the past – but now she knows the lot, and has been incredibly (and surprisingly) understanding and wonderful about it all – I am sure she will make me pay at some point J but I owe her so much, it would be nice to be able to take her out for a nice meal once in a while.

Thanks for reading – and any advice/comments more than welcome.

The challenge starts here!

rivendale0506

Hi welcome to you first of all. :hello: I am only a "newbie" myself, and I am sure others will be along to help you with this, but I think the general concensus is usually to pay off the debt with the highest % interest first and only pay the minimum on the other cards until that one is cleared and then whatever you were paying off on the first card add that to whatever you were already paying to the next highest % interest card and clear that and so on.

As I said, I think this is right, but I am sure someone far more qualified than me will be along in a minute...

RAS

Hiya and welcome

You need to pay off the most expensive debt first. Have a play with the snowball on www.whatsthecost.com. Then you can see the impact of keeping £350, £300, £250 or £200 per month back.

Unless your debts have APrs lower then you can get for savings accounts, clear the debts first.

Beerworshipper

Hey Enough,

You should use this tool, its called a snowball calculator, it lets you play with youre debt figures and works out the best order to attack them and how much to throw at each one.

Here is a link: http://www.whatsthecost.com/snowball.aspx

I think as a general rule though its always better to pay the debt off first before saving any, difficult to do I know but it usually works out best in the long run. Sometimes though you have to save if its non flexible debt e.g. most bank loans. If you post some more info about what sort of debts they are then people will have a better understanding and be able to offer more specific advice.

As for using a pre-pay debit card, do you have to pay a commission on them. I just asked my bank for a second current account. This 2nd account has its own debit card, cheque book etc. Every month I transfer some money into this and thats 'my' spending money. Once its gone its gone but sure makes it easier to keep track. Plus its free and has no commision fees.


Anyway, well done for posting and seriously, give the snowball calc a go.:T

Good luck and well done for the Light Bulb Moment (LBM):beer:

Persolv0

Hello Enough and welcome
Well done for facing up to your debts and i admire the determination in your post.

Firstly posting your SOA up will work wonders for you to see where you really are and rmember its best to come at this from two angles....1)decreasing your outgoings wherever possible and 2)increasing your income if possible.

Posting your SOA will help everyone help you decide what the best way of attacking your debts are but generally speaking it will be better to pay off more to the CCs and other debts each month as the interest charged on these debts will most likely be higher than interest gained in a savings account.

If its possible to get into a strong enough position to avoid paying off the debts via your house sale but continuing to pay from overtime etc then obviously that would be more money to put into a deposit in a bigger place without effectively stretching those debts over the lenth of a mortgage....but then the temptation is there to clear you feet of the CC debt and start afresh i guess so ............

good luck and well done again

bargainbetty

You could be even braver, and use all the money saving tricks on here to save a bit more.... take your own lunch to work, save a fiver, cut down on wasted food etc.... put the daily change in a pot, and throw that at the debt at the end of the month too. Every little helps.

Good luck - you'll get there eventually

Enough_is_Enough_4

Thanks for all the kind responses

I do already take my lunch to work and scrimp and save where i can.

I did that snowballing thing (thats excellent thank you all) and I need to pay off my Cahoot loan first (14.9%) then my MBNA card (13%) then my Natwest credit card (8.9%) and then finally my fixed natwest loan.

My only luxuries will be football on a Saturday with my friends (about £35 every fortnight). I will look forward to that.