When do you know you need to do something?

isitenough

Yep, we have the one main car now, paid for with cash. Both sets of parents live about 50 miles away and so we need the car just to see them occasionally.Couldn't do without a car. It's a luxury yes, but one I really would fight for. *touch wood* it's pretty good so repair bills have been few and far between (so far). Insurance is always shopped around for. Tax and fuel can't help, but we try not to do unecessary journeys and see parents once a month.

shinyhead

Hi isitenough,
I'd suggest trying CCCS's online debt remedy and see what it comes out like. I also suggest you come back here and post your SOA so we all can help if poss. The result you get from CCCS might help you decide what to do. I've been on a DMP with CCCS now for a couple of years and although it's saved losing the house and so on it is very restrictive, ie no holidays. Also owning a car that you don't actually need to get to work I believe is frowned upon by creditors if your'e on a DMP.

I wish that I'd faced up to my debt problem a lot sooner than I did. I would have saved a fortune. I also wish I'd found out about this forum a lot sooner than I did. However you may have caught it in time. We'll have loads of questions, such as how long your mortgage is to run and so on. But simply posting your SOA could help you immensely.

Merlot

shinyhead wrote: »

Hi isitenough,
I'd suggest trying CCCS's online debt remedy and see what it comes out like. I also suggest you come back here and post your SOA so we all can help if poss. The result you get from CCCS might help you decide what to do. I've been on a DMP with CCCS now for a couple of years and although it's saved losing the house and so on it is very restrictive, ie no holidays. Also owning a car that you don't actually need to get to work I believe is frowned upon by creditors if your'e on a DMP.

I wish that I'd faced up to my debt problem a lot sooner than I did. I would have saved a fortune. I also wish I'd found out about this forum a lot sooner than I did. However you may have caught it in time. We'll have loads of questions, such as how long your mortgage is to run and so on. But simply posting your SOA could help you immensely.

Excellent post from someone who knows the implications of a DMP, they can be restrictive, but on the other hand if your debt is becomming a real burden a DMP is the way to go, at least you know you will repay your debts off within a certain number of years. Have all your creditors accepted the DMP, do you receive any phone calls, I ask because I feel it is important that the original OP has all the facts infront of them before choosing a DMP.

Merlot.x.

shinyhead

Two creditors hounded me from the outset. I've now two CCJ's against me. Apart from that there was an initial storm whilst setting up the DMP that settled within days of CCCS contacting them and my first payment going out. It takes a while for some creditors to accept that you actually can't pay them properly anymore. I've also had a number of defaults issued on my credit file. looking through the threads here will explain the implications of that.

My personal advice is try to avoid a DMP if you can. But, only if you can make enough savings to be able to move forward with your debts. A dmp could be the way to go if your payments to your creditors, although less than present, are still high enough for them to accept.

kizzykizzywizzy

Hi there, I got my job through a small ad in the school newsletter, no experience at all, it's mostly mums that do the job, ring your local council & find out who does the catering & give them a call, I don't earn enough to be taxed & it does make a difference, also it's nice to meet new people.
As for AA, I got free greenflag with insurance through prudential + loads back from quidco. I personally wouldn't get rid of breakdown cover as if you breakdown on a motorway it costs a bomb. BUT don't just auto renew as the AA rip you off! new members get better deals. I would just get basic cover if you can't afford more, or use some of your clubcard points for RAC ?
I've been lax with the comps lately, but I did really well last year when I had more time & sold quite a few bits on Ebay & gave some things for presents etc. I will start again when I'm off for the summer hols:D

WorkingHardDFW

H isitenough and welcome

I've got similar sized debt to yours now and at times if feels such a burden but as we've slowly reduced it I start to wonder what i will do when its gone!

I think posting your SOA is critical. the friendly experts on here will soon point out ways to save etc

Our huge debt came through living beyond our means for a long time and not budgetting for things which happen like birthdays, christmas, holidays the list goes on. Through keeping a spending diary we've gradually seen where we've been overspending against our now scarily realistic budget and are now living within our means.

Its not been an easy journey so far particulary when we are surrounded by friends who have no idea of our situation and live very comfortable lifestyles. But we are happy and suceeding in reducing our debts. Personally its been amazing what a good few months can make to your situation.

Good luck :cool:

isitenough

Cheers.
We've taken a trip to Aldi and Netto to see what sort of prices they have and we've worked out what we can spend each week on food so I'll sort out the usual things we buy and see what prices they are in various places.
We're probably going to use Clubcard points for the RAC as even though we've been with the AA for 12 years now it's not getting any cheaper and as you say, new members get better deals!!
We're going to change Sky package to the minimum and also the DVD rental, which is a luxury but before we rented dvd's we just went out and bought them (which is where a lot of debt came from, buying silly things we didn't need) so at this point that's a plus. A loan we've got ends in 4/5 months so that will be a small amount to go to other debts. Every little helps. We've also cancelled the window cleaner, we only had him cos OH doesn't like climbing ladders and wouldn't do the upstairs windows! But I can do that and I actually enjoy it!
I did used to sell quite a lot of stuff on eBay but with price increases last year I stopped, might have to start up again - cheap listing days only though otherwise you don't seem to make much (and no paypal cos that eats your profit too!).
We're also going to ask family (very nicely!) to cut down buying us things for Xmas/birthdays/anniv. etc.. as we really can't afford to buy much for them and we feel guilty otherwise. MIL is easy as she's an avid reader and any books I win keep her happy!
Just through making decisions to cut back in the last day or so on all the above we're going to save about £140 a year, doesn't sound a lot but it will help.
Will get around to the SOA, it's easier when OH isn't here as he doesn't know I've started this thread!

Poosmate

Hi Isitenough,

I looked at going on a DMP through CCCS about a month ago - it scared the living daylights out of me to be honest!

There were several reasons why I decided not to go on a DMP, one of those reasons is because I am continually living in my OD which I know is not ideal but it gets paid off each month and then creeps up, how high depends on my everyday spending habits. With a DMP this, I believe would be taken as a debt and you would have to start paying a bit off it each month. From what I understand of DMP's is that I wouldn't be able/allowed to go into my OD again (as it's seen as creating further debt? Pls correct me if I'm wrong on any of these counts). The thought of not having my OD as a safety net scares me.

Another reason is that I have a current account attached to my mortgate so the interest I pay on that is low. I freely admit that I was really stupid with that money, I built up a credit limit of £2.6k, initially being really sensible and only buying essential items like my car and bricks n mortar for a garden wall (long story) and then on general living expenses when my lodger left as I couldn't make ends meet having been used to his rent money. Suffice to say, things went critical on that account when I realised that the interest due in April would put it over the OD limit and incurr a charge (I haven't paid any charges for about 7 years - nothing for me to claim back :-(). This was my lightbulb moment! The debt increased mainly through lack of mainteneance and interest - the first time I made a payment into that account was in April (£20) to cover the interest and a bit of the debt and £50 birthday present money to give a bit of a buffer in May. The monthly int on that is now less than £15 so I pay £15 per month into it because the int rate is low. This is a long term debt as is my OD which will be paid off eventually but is managed atm. I know it's probably not what most people on here would do but it works for me I would rather pay £14 per month in interest and know that the wolf won't come knocking for any more.

I use the money that would have been paid into that account and my OD had I gone on a DMP through CCCS to pay off my higher rate interest credit cards. The minimum payments are coming down every month but I pay the same amount off each month so reducing these debts quicker. It also means that if something crops up I have the option to make only the minimum payment and use the overpayment money on whatever it is that's cropped up.

This probably won't make sense to many people but I am paying about £100 in interest on my debts and paying about £50 off the debt each month but I'd rather do that and have the flexibility to pay more off whichever debt I want to when I have a windfall (like selling my 2 scrap cars for £200, or selling stuff on ebay). I can move my debt around - to 0% deals or low % life of balance deals. I know it could take many years to pay off my debts but then I might win £200 of shopping vouchers (see sig).

The point is, I am managing. I look forward to receiving my bank/cc statements just to see how much the interest has reduced! I check my financial spreadsheet almost daily and the debt is reducing and it's such a good feeling. Every month that passes without incident means an extra £15 into my savings which will be spent on tax and insurance for the car and not be added to my CC. I have finally managed to break the cycle of paying for stuff like that on my CC.

Doing it yourself is so empowering. It's bloody hard and you have to be consistent, checking statements, balances online, maybe moving money about, knowing who to pay when etc. There's no let up but believe me it's so so worth it to remain in control of your own finance.

There is no certainty in the future, the journey is long and the mountain is high but there will be plateaus (unexpected windfalls) and bridges to cross (unexpected expenditure). You need to work with the tools you have, your knowledge, wisdom, income and your thriftiness and use them as efficiently as you can.

Hope that helps

Poo

Prediction: You will have a plateau in September's pay packet of £60 due to the personal allowance income tax threshold being raised + £10 pcm thereafter.

waddy_2

hi isntitenough, i too am scared to death about a dmp although it seems like a way out. i have £10000 ish in debts but am managing most payments on time and up to date. however my fixed rate mortgage ends next year and i really want to try to switch to a high street lender to get a better deal and this is what is putting me off. if i go on a dmp i think my chances are pretty slim.take the advice of others and call or go online to cccs. i did and they are really helpful. will check in to see what you decide. hope all goes well even though i havent been much help. i think you need to carefully weigh up all the pros and cons first. i am still undecided.

Poosmate

Hi Waddy,

Sounds like you are having or have just had your light bulb moment! Thank heavens it's not too late. At least you know you have a year(ish) to make necessary changes to lifestyle (reducing bills food, electric, gas consuption, going out?), spending (buy what you need not what you want), finances (move debt to lower int rates etc.).

As I stated in my previous post, I have found it much easier to manage my debts by studying each one in detail (knowledge), realising how it accumulated (CC tax+insurance for car + any other annual bill) and stopping the cycle that made it accumulate (wisdom). I am existing (thriftiness) for now to pay off my debts (on time and without charges) and I know that by doing this for a while I'll soon be able to start living on cash rather than credit.

I know the light is there at the end of the tunnel and I know that the longer I exist the shorter the tunnel will be but I am prepared to sacrifice "doing time in the tunnel" to live occasionally.

I hope you can exist for long enough to bring your monthly payments down to a more comfortable level before your fixed rate runs out. As they say "forewarned is forearmed".

Talking of the aforementioned saying, I created a thread called "Preparing For Strike Action" it's kind of a similar situation to you but on a much much smaller scale, I am £84 short in my May salary due to strike action in April. Ok, It's only £84 and only for 1 month but the tactics I deployed have swallowed that deficit in my salary quite easily. Hope you read it and enjoy it.

Thanks

Poo

P.S. isitenough, I'm sorry to promote my own thread on yours but I think it might help Waddy a little bit(?). Please PM me if you want me to edit my promotion out. Thanks again. Poo