Shall I go bankrupt or carry on ignoring my debt?

Carlyt

Hi everyone,

I was hoping for some advice on my situation, I am on ALOT of debt, it all started about 3/4 years ago when I was 18 and the bank threw a loan, credit card and overdraft at me, I was young and daft, toojk out more credit and started robbing peter to pay paul meaning i owed lots of companies lots of money, I was between jobs, never stable, as can be expected at 18 years old!
I am now more respnsible, live on my own and struggle every month to pay the household bills and get to work.......my debt still haunts me, I have defaults and CCJ's all over the place, I don't think I have any credit that isn't at default or is paid on time. I can't afford to come to arrangements with these companies as I just don't have the money coming in, like I say I struggle to pay everyday bills.

I don't really want to go bankrupt as I will one day come into inheritance which will be quite alot of money.

The credit companies are constantly sending me letters, phone calls etc......I have ignored them for at least 18months, its been my way of dealing with it (not dealing with it).

I am rubbish with money, I can't budget to save my life, I'm rubbish at paying bills on time and when I don't have the money to pay bills, I panic, burry my head in the sand and ignore it!

.............There I've admitted how rubbish I am.......please help!

alone_and_fed_up

Firstly you aren't rubbish!

Might I suggest you do a statement of affairs which will help you and other MSErs see exactly where you are financially.

If you do a search for SOA it will point you in the direction of one which is excellent.

Waspeze

Hi Carly,
Well done for posting .. you've taken the first step which is always admirable :beer:

First off though you need to talk to one of the debt charities, they are there to help you and do not charge like the unscrupulous companies you'll see advertised!

CCCS, CAB or national debtline.

I'll get the links and phone numbers for you!

Waspeze

Here's the numbers taken from Tigerfeets Signature!

From my own point of view I phoned CCCS and they were really helpful and talked me through everything!

Your first port of call should be to contact one of the Debt Charities; see links below. Their services are free; they have no vested interest to serve; their advisors are professionally trained and the advice they give will be objective and in your best interests only.

CCCS 0800 138 1111 National Debtline 0808 808 4000 Business Debt Line 0800 197 6026 CAB – Contact your local office and ask to speak to a Specialist Financial Advisor. Insolvency Service- 0845 602 9848

Waspeze

One thing about the inheritance .. i know its not nice thinking along these lines but if you did go bankrupt (please take advice first!!) then you should be discharged after one year so any inheritance after that will be yours to keep, UNLESS you get an IPA (income payments agreement) which will last for three years.

My nan's just changed her will to exclude me and give everything to my parents so it isn't wasted!

NekoZombie

Waspeze wrote: »

One thing about the inheritance .. i know its not nice thinking along these lines but if you did go bankrupt (please take advice first!!) then you should be discharged after one year so any inheritance after that will be yours to keep, UNLESS you get an IPA (income payments agreement) which will last for three years.

My nan's just changed her will to exclude me and give everything to my parents so it isn't wasted!

Actually, even if you get an IPA any inheritance you come into after discharge is yours to keep. An IPA is only affected by your regular income. With that in mind, I don't know if it's worth changing any wills unless your grandparents are literally at death's door.

Waspeze

NekoZombie wrote: »

Actually, even if you get an IPA any inheritance you come into after discharge is yours to keep. An IPA is only affected by your regular income. With that in mind, I don't know if it's worth changing any wills unless your grandparents are literally at death's door.

Oooh, I didn't know that thanks NZ I thought you had to declare all "windfalls" for the length of your IPA!

Only have one grandparent

My nan has alzheimers (sp.) and is very frail... hopefully she'll be with us for a while yet but if her quality of life deteriorates too much then (i know this might sound wrong ) I almost hope she passes to a better place

The will has already been changed, our family lawyer is a good friend of my parents so did it for free, don't think it's really worth changing it back now but will definitely check this out properly when i'm discharged!

skylight

My father has also changed his will soley due to my bankruptcy and he intends (I hope!) he will change it back once I am discharged.

Back to the OP though, I think that before you do anything else, you need to sort out your own budget. Its pointless doing anything to resolve the situation if you cannot resolve the matter at source - you will find yourself back to square one if you do not sort yourself out with this.

If you are already ignoring the creditors then I suppose you have an amount of time to actually do something to get your budget/spending into order before you deal with it. And you do have to deal with it, be it paying it back or BR - it won't go away. If you are not paying any debts back but you are still not meeting your bills on time, then you are either overspending or your income simply does not match your basic outgoings - posting an SOA (statement of affairs detailing ALL your income and ALL outgoings) is essential.

Budgeting is something you have to learn. Its not something that comes easily to any of us and its not something that most schools or parents teach us (mine didn't and I intend to redress that issue with my kids!) and budgeting is essential to dealing with your debts.

Carlyt

Thanks everyone, I need to start budgeting, I would love to get to the end of the month and think...."wow i've not borrowed anything this month", I find it really hard living on my own financially.
I am trying to stop smoking at the minute, I go to stop smoking service every thursday and have cut down alot as it is a bad habbit and a unnecessary expense. So stopping smoking will save me. I am also selling my car in the next month so i can clear the finance and just buy a little run around with the money i make from it.
I think if I can manage financially every month then I will be able to think about the bankruptcy with a clear head, as there are things that worry me about going bankrupt, i work in finance, so will this affect my job???? Also will i be able to keep my basic yorkshire bank account? Will everyone know I am bankrupt?

Also I'd like to think that one day I will get a mortgage and buy my own place instead of renting.

I will do the budget planner as advised.....I have done these before and they always end up showing more outgoings then whats coming in.....

I earn between £1100-£1400 a month but just switched departments in my company to try and earn more bonus every month.

Rent £350

Council tax £65

Water £20

Electric £80 - (in dispute with Npower, I have electric storage heaters and they apparantly cost about £300 every 3 month, bearing in mind i live alone and work all day, so rarely in! I cant change suppliers due to the arrears, I think its about £1500, but even Npower have admitted that this isn't right and the meters in the flats may be crossed over, so i may be paying for a few peoples electric)

TV licence £20 (currently in about £60 arrears)

Gym £28 (my only luxary and way to relief stress

Mobile £35

BT Line rental £15

AOL internet £24

Mums partner £210 (he loaned me £2500 to clear outstanding car finance as they were going to reposses my car, I live 1hour away from work so public transport not an option unfortunately)

Petrol- £50 a week to get me to work and back and usually covers weekend fuel, if i go see family and friends.

SMOKING- I'm on about ten a day at the min, I really need to stop this!!!

Any advice on cut backs will be appreciated, I am really rubbish at budgeting and I can't remember the last time I paid every bill in 1 month due to borrowing money every month and just been in a pickle really.

wow got that off my chest!

Waspeze

Hi ya.. just a quickie to say good on you for trying to give up smoking :T

There is a giving up smoking thread on DFW that's been great for me for support though the tough times!

(p.s. I used champix and has worked really well for me!)

RecoveringAlcoholic

Try roll-ups.
My friends get their tobacco free from the pavement.

And:

http://www.adviceguide.org.uk/index/life/debt.htm