Untangling our financial disaster
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Had a good go at the spends and if you can hit your targets that will be fantastic.
I think you have very aggressive targets so would put some of the surplus into a buffer fund the first month, effectively if you could have £3k to work within but should only be spending around £2200Entertainment........................... 100
That's a major reduction, have you worked out what you are giving up and how to get the best out of the £23 per week you have allocated that's less than £8 each down from nearly £29 each
Something that has not been touched on yet is income that is another way to tackle the debt.Monthly income after tax................ 1800
Partners monthly income after tax....... 3324
They equate to around £27k and £55k gross
Is there any scope to increase either of those, you said they have gone up a lot in the last 5-6 years so maybe they are at plateau.
On the £55k that means there is some taxed at 40% definitely worth looking at upping pension contributions to take advantage of the long term saving.
This can be better than paying off debt.
If the employer has salary sacrifice there could be NI savings as well.
2019/2020 this will hit net by £170pm but boost the pension by £5k.
if you hit the debt in the first part of the year and then do a lump sum into pension this time next year that would give the max benefit.0 -
Just wanted to encourage you with our story. We had over £50k of debt in 2007. It's all gone now, paid back every penny and the best part now is that once the money became ours again we were able to save properly and now have over £50k in savings.
It can be done and you can live a little.Spend less now, work less later.0 -
Just wanted to pop on and say hello :wave: and best of luck.
I'll be cheering you on!
MM
xLBM: 12th February 2019
Debt: £21,104.71 / £20,861.35 1% PAID
Mortgage: £325,518.47 / £325,518.47
February Bring Your Lunch to Work - 1/7 (joined late)0 -
Readytochange wrote: »I know you're right. I suppose it's just the lure of no interest, although i expect that a DMP wouldn't be allowed, even if we did pursue that option.
I would love to be able to speak to others in this level of debt. I don't see many on here in this level of unsecured debts.
I can't find it, but see if you can find a post titled 11 years a slave. IIRC , he had around a 100k of debt and he cleared it. I think it's one of the most inspiring posts on the board.
Good luck!Yes I'm bugslet, I lost my original log in details and old e-mail address.0 -
All shall be well, and all shall be well, and all manner of things shall be well.
Pedant alert - it's could have, not could of.0 -
Thanks elsien. I can't search on my phone for some reason.Yes I'm bugslet, I lost my original log in details and old e-mail address.0
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Makes you wonder why he did not declare bankruptcy?No reliance should be placed on the above! Absolutely none, do you hear?0 -
Readytochange wrote: »I know you're right. I suppose it's just the lure of no interest, although i expect that a DMP wouldn't be allowed, even if we did pursue that option.
I would love to be able to speak to others in this level of debt. I don't see many on here in this level of unsecured debts.
A DMP is not allowed if you can afford minimums and much of your expenditure would be expected to be reduced before going down that route. Also a DMP is not an easy option so should not be entered into lightly and certainly not to see if you can get interest charges stopped. It would impact your credit rating and your ability to get a remortgage deal if you needed one.
There are many on the debt free diaries who have or had your level of debt and yes some have gone down the DMP route but are on much lower incomes than you. We often find though that those on higher incomes never seem to register the debt until it gets to a level where yours is or higher. The plus point is having a large income means it can be dealt with in a relatively painless way once you have some financial discipline. It will take time though as presumably you did not build the debt up overnight.
I think I would get rid of Argos first. That gives you an easy win and you could clear it outright in one month with your surplus. The two expensive credit cards should be targeted next. Normally I would say build up emergency savings but your surplus is so high now you have a sensible soa I don't think that is essential although you could start putting £100 a month in savings. That is to stop you turning to credit every time you have an unexpected bill. That mindset needs to change. If you made a concentrated effort and used £1000 of that surplus to overpay the debts you could get rid of the CC3 and much of CC4 in a year. As you get further on in the journey 0% deals may become available.I’m a Forum Ambassador and I support the Forum Team on the Debt free Wannabe, Budgeting and Banking and Savings and Investment boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.0 -
Just popped back on to see how your getting on RTC. Glad to see that you are feeling better.
There's an article today on the Guard website about clothing and fast fashion and how some have actively chosen not to buy new clothes. Buying 2nd hand/up cycling is becoming the norm now, I think more through necessity for people. Benefit cut/restrictions, high levels of debt in households, zero hour contracts, jittery economy, people just don't have the money/can get credit or are unwilling to buy new for environmental reasons.
https://www.theguardian.com/fashion/2019/feb/19/dont-feed-monster-the-people-who-have-stopped-buying-new-clothes
Youll feel great once that first credit card /loan is paid off, the tense knot in your stomach begins to ease off, you'll begin to see the debt coming down. Also you get a buzz going shopping with your list, buying ONLY what's on your list and coming out with money in your pocket. It's like sticking two fingers up at the retailer saying 'ha ha you can't con me out of MY money.' Or you decide, you don't NEED that particular item. Because when it boils down to it its always been about what we WANTed.Just because I disagree with you, doesn't mean I hate you. We need to understand this as a Society :beer:
Each morning we are born again, what we do today is what matters the most.
Debt-free wannabe....
May 2016: £53k and counting down.;):T
April 2018: £34k and counting down :j0 -
Someone suggested that we should have gone bankrupt but I was brought up in a time when bankruptcy was shameful. Also we had spent every penny of the debt so felt we should pay it back, interest as agreed too.Makes you wonder why he did not declare bankruptcy?Spend less now, work less later.0
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