young and had too much fun!

Clariman

I have promotional meetings at the end of the year and i would have the opportunity to get a 35k basic and earn commission realistically providing OTE upwards of 75k. do i wait and hope that i can earn well andpay off debt then? or do i deal with it now?

You need to deal with it now! You have been in debt before and then been bailed out by your father, so you didn't have to fully deal with it. You are still making impulse purchases which proves that you have never addressed the underlying overpsending problem. If you don't deal with it, you'll stack up more debt and then never see the benefit of any future commissions.

That brings me on to another point. I have worked in sales for a good number of years. It can be pressurised and job-loss can be a genuine consequence of missing targets, so you don't want to put yourself in a doubly stressful position by stacking up debts that you need to make future earnings to pay off. Also, sales managers are very good at telling you how much you can earn in sales. It looks like someone has done a good job in doing that by saying that you can make "upwards of 75K OTE". Of course, you could also just make your basic too!

The real way to make a commission based role work for you is to live within the means of your basic salary. If you get a 35K salary plus your partner's salary, then that's loads to live off. Then you can use commission for buying your LCD TV or, even better, for laying the foundations for a very financially secure future and/or for retiring early

Clariman

siross2203

i think something that needs to be mentioned again is that yes my dad has paiid off all the debts for me but unfortunately i am not the kind of guy to not pay him back, therefore i dont see it as a bailing out, i had offers of loans available but took the issue to an unsuspecting dad who had no clue about it all!

i understand the need to deal with it now and not to rely on future commission, i appreciate that point and it does make sense so thank you for that.

i think you are right that i am a spender and always have been, thats where the situation originally arose from and in your opinion is the only way to stop this to do things like not taking my wallet to work? Is it just a case of beinga bit harder on myself and forcing me not to spend?

Gemmzie

Empty the savings into the overdraft, see if you can get a broadband offer with your satellite (sky is free or £5!), then start over and start saving in separate accounts for car costs, birthdays etc.

Clariman

siross2203 wrote: »

i think something that needs to be mentioned again is that yes my dad has paiid off all the debts for me but unfortunately i am not the kind of guy to not pay him back, therefore i dont see it as a bailing out,

Yes, I saw that. I should have acknowledged that in my reply. Sorry. However, I stick to my general point that getting a non-commercial loan and then continuing to make impulse buys, combined with thinking that maybe you don't have to address debts now when you might have a higher income coming, suggests to me that the lightbulb needs to start shining a little bit brighter.

i think you are right that i am a spender and always have been, thats where the situation originally arose from and in your opinion is the only way to stop this to do things like not taking my wallet to work? Is it just a case of beinga bit harder on myself and forcing me not to spend?

I think that is is an attitude of mind. Often we buy things as a kind of "treat" - call it retail therapy if you like. The answer is to find happiness and satisfaction elsewhere in life I think.

Clariman

siross2203

clairman, loaner, thanks a lot for your help. I really do appreciate it all.

one of the guys at work earns probably 4x what i do but is the tightest person i have ever met, going to be his little apprentice and learn to not spend as it seems to work for him!

thanks again for all your help.

Horace

When you look for car insurance, use one of the comparison sites and then buy via a cashback site such as Quidco because you will at least get some money back for your purchase.

When you go shopping make a list of what is needed (have a good look in the cupboards before you go) - get what is on the list and if you run out in the meantime just put it on the list for the next shopping trip. Do some food shopping in places like Lidl and Aldi - their food is good and cheap. If you buy meat don't buy it from the supermarket find a local butcher (you can tell the good ones because they usually have a queue outside).

HTH and good luck.

Poosmate

siross2203 wrote: »

Hello All,

I am a twenty year old guy, live in a rented place in the centre of southampton with my girlfriend. I am fortunate in the sense that i have a good job paying well for my age with the ability to progress relatively quickly. I will post my SOA at the bottom but would like to explain first!

I earn 25k, my girlfriend 16k, so combined we do quite well but both have the ability to slip and think its a great idea to buy a new LCD TV for the bedroom at £250. I had 10k debt at 19 and luckily my dad loaned me the money to repay it all and i pay him back 167 a month as it equates to 2k a year. I have promotional meetings at the end of the year and i would have the opportunity to get a 35k basic and earn commission realistically providing OTE upwards of 75k. do i wait and hope that i can earn well andpay off debt then? or do i deal with it now?

I am writing on here just so that people can comment or suggest anything that i can do to maximise my income, to properly demotivate myself from spending. I have only about 500 saved but my car insurance is due for renewal in september but will be roughly 1k which i'm not sure what to do about - do i get a 0% card or what?

I know thats a very brief run down but if any of you more experience moneysavers see anywhere to save some cash then i would grealty appreciate it.

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 1577
Partners monthly income after tax....... 1023.17
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2600.17

Monthly Expense Details
Mortgage................................ 0
Secured loan repayments................. 0
Rent.................................... 760
Management charge (leasehold flat)...... 0
Council tax............................. 91
Electricity............................. 25
Gas..................................... 25
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 12.5
Mobile phone............................ 85 Ouch!1
TV Licence.............................. 11.29
Satellite/Cable TV...................... 37 Ouch!2
Internet Services....................... 24.99 Ouch!3
Groceries etc. ......................... 200
Clothing................................ 0
Petrol/diesel........................... 40
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 6.48
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0 Save £100pcm Hmm..1
Total monthly expenses.................. 1318.26

Assets
Cash.................................... 500
House value (Gross)..................... 0
Shares and bonds........................ 380
Car(s).................................. 4500
Other assets............................ 0
Total Assets............................ 5380

No Secured Debt

Unsecured Debts
Description....................Debt......Monthly...APR
Virgin CC......................400.......100.......0 Hmm..2
HSBC Overdraft.................980.......100.......0
Tesco CC.......................957.......300.......0 Hmm..3
Dad's Loan.....................9500......167.......0
Total unsecured debts..........11837.....667.......-

Monthly Budget Summary
Total monthly income.................... 2,600.17
Expenses (including secured debts)....... 1,318.26
Available for debt repayments........... 1,281.91
Monthly UNsecured debt repayments....... 667
Surplus(deficit if negative)............ 614.91 Hmm..4

Personal Balance Sheet Summary
Total assets (things you own)........... 5,380
Total Secured debt...................... -0
Total Unsecured debt.................... -11,837
Personal net worth...................... -6,457

Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.

Hi Siross,

Well done for being responsible and asking for advice before you get into any more debt.

I think I have a different outlook on debt than others who have posted on here so will probably be slated for my suggestions but this is what I would do if I were in your shoes.

Ouch!1 = Is this 1 mobile or 2? Even if it's 2 it's still high but you recognise that anyway. As you now have a works mobile could you go for a PAYG tariff? I believe they are cheaper.

Ouch!2+3 = TV and internet are both high. I get the large tv package, m broadband and telephone (never used - I kept my BT together package and nevre pay for calls, Virgin couldn't offer this) from VirginMedia for £30 (3for£30 deal).

This is where I differ from others views.

Hmm..1 = If you could save £100 per month from your disposable monthly income, in September you would have £800 towards your insurance.

Hmm..2 = If you continue as you are, you will only have £100 left to pay on this or £300ish if you need to use it to make up the deficit in your savings for your insurance.

Hmm..3 = Again, if you continue like this you will only have £57 remaining on this card in September freeing up an extra £243 per month from then on.

Hmm..4 = Could you and your gf live on £50 per week each even if it's just for a few months?

By doing it this way, in October you will able to pay off the credit cards completely (or more or less if you have to use one for the insurance). You also should be in the habit of saving £100 per month and be used to living on £50 per week each.

In my opinion, your overdraft is the hardest to pay off because that money is there just waiting to be spent and you are always starting the month with £1620 income because £980 is already spent. By reducing your weekly everyday spending to £50pp/pw you will not be eating into the overdraft so much each month. By spending all of your £614 surplus income you will always go into your overdraft and the £100 you think you are paying off.

Alternatively, and this is what I would do in your situation, I'd pay off the overdraft with one of the credit cards (for simplicity, the Virgin one, and pay £200 per month off it. Another absolute must would be to cancel the credit card you do pay off completely so you cannot accumulate any more debt and also reduce your overdraft limit to maybe £300 at the most or better still get rid of it altogether.

I forgot when your car tax is due. If you don't have savings to cover it as well as the insurance and they are close together you might want to take out just 6 months tax instead, I know it's slightly more expensive but it will give you a bit of breathing space to save up so you can pay for a full year in 6 months.

My CC debts have accrued through paying annual bills on my credit card, I have finally managed to save enough money to break that cycle this year and am now paying off my debt which is effectively my car tax and insurance from the last 4 years or so :j .

Hope this helps a bit.

Poo

P.S. I know my sums don't add up completely but they are more or less there given the information from the original SOA and taking account of further posts - £614 surplus income, - £100 for savings, - £114.00 for future tax/mot/servicing (less I know but just trying to round it off) = £400 = £50pp/pw. Also, the water rates wil have to be factored in as and when Sirross knows what they are so can't really comment on that.

Poosmate

Sorry, I forgot,

I just wanted to add, that my salary is almost identical to you girlfriend's (I take home £1032.67 pcm). Out of that, I run a 2 bed semi paying all the bills, gas, elec, ctax, water, tv lic, tv/int, phone, mortgage. All that comes to about £615. Out of the remaining £418 I pay for food, car tax, car ins, petrol (£130pcm big ouch!), credit cards (£140pcm another ouch!) and manage to save just £15 per month. By the grace of God I have managed never to have incurred any bank charges, well certainly not within the last 6 years anyway!

Easy peasy! lol I wish!!!

Good luck to you anyway and once again well done for recognising the problem before it got too bad.

Oh and one last thing, please, please, don't rely on expected future earnings. I was stupid enough to believe everything would be alright when I got an expected payrise, only I didn't get the payrise! I now expect nothing from the appeal I have put in, those words "You should do well out of this" still ringing in my ears! Don't believe anything till you see it in black and white addressed to you!

Thanks

Poo

poorandindenial

Hi there

I wanted to share my experience with you. I also have a well paid job and have had since I left uni at 22. But I also have a lot of debt.

I referred to myself as a 'spender' and I was (I used to think that I spent £70 a month on clothes and stuff but the reality was probably closer to £400 or more), I spent crazy amounts on all sorts of things (some not to distant leafing through my underwear drawers showed that I owned 150+ pairs of knickers and over 60 bras, I also have two large wardrobes and three chests of drawers stuffed so full of clothes that I have to have a full washing bin or else I can't fit it all in my room. Oh and this year so far I have sent 8 big IKEA bags of stuff to the charity shop so the problem used to be worse. I also have goodness knows what else coming out of my ears. I also had more than 80 bottles of mainly expensive nail varnish and goodness knows how many lipsticks and eyeshadows).

(NB before I get harpooned by others, I know I should flog stuff to clear the debt but I find ebay too soul destroying so I give it to charity instead)

I have almost done a complete U-turn, and while I am far from perfect I no longer several times a week buy a new £40-70 top on the way to work or pop into boots and come out £60 lighter because I am waiting for the train.

The point of that is to say that because I thought 'I will earn more in the future' I let the problem roll on, consolidating and then carrying on (which is effectively what you have done with your dad)

If I can change my spending habits then you can too, and believe me £35k is a lot harder to get rid of than £11k - remember that you may not always have a great credit rating (even if you keep up repayments if you have too much credit you will start to see those 0% interest rate offers dry up) and battling against your debt when interest is running at 15-30% is not fun. Remember higher salary equals more credit and your expenditure does expand to fit this which equals more debt (trust me, I know)

Don't rely on your future income, until the ink is dry on the contract you have no guarantee of your future salary. Employers find it cost effective to keep people rather than re-recruit and they will often oversell what you can earn or the benefits you will get from a given role - beware of employers bearing gifts that seem too good to be true, you may have got lucky, but you may also find that things aren't quite as they seem, i hope the former is true fof you.

I don't want to be the voice of doom but where you are now is where I was 5-6 years ago, I wish I had woken up and got real way back then, if I had I could now have had savings of £60k+ which would be a very healthy deposit on a house or enough to allow me to take a career break to retrain or do whatever I wanted with really.

The quicker you sort this the more you can enjoy your money in the future.

poorandindenial

siross2203 wrote: »

one of the guys at work earns probably 4x what i do but is the tightest person i have ever met, going to be his little apprentice and learn to not spend as it seems to work for him!

Excellent plan