Taking the plunge and confessing!

kerryhoney · 24 August 2006 at 11:56AM

Hi all.

Just being selfish and asking for some motivational tips....I have been on this website for a year now but have never really taken the plunge to look at my finances and add up all my debts. I know that they are totally crazy, and not out of control to the extent that I can't manage the repayments, but that my overspend for the last four years is about £300 a month and is continuing. I just can't seem to stick to any kind of budget and seem addicted to shopping. It sucks. It's a vicious circle - i spend money cause I'm angry about not having any, then I have even less and spend more. I know it sounds stupid and I should just kick my !!! into shape but I have tried on so many occasions and always end up carrying on as before. It's almost as if I think "well another £100 is going to make any difference to my massive debts".
Did anybody have a lightbulb moment that made them snap out of it or does anyone have some amazing help to give me. I know I'm being selfish typing this about memememememe but you lot do seem like a helpful bunch (creep!)
Kerry

natlie · 24 August 2006 at 12:12PM

Hi
my lightbulb moment came when I was refused credit, and couldn't afford to pay for food even. We lived of things I made out of the cupboards, at that point I got a new job, and have been good at keeping up my repayments since, even though I have had a baby and had to go off work with only Maternity allowance of !108 a week to live on.

You really nedd to do an S.O.A and see where all your money is going. I keep an excell spread sheet of all my incomings and outgoings and I check it religously its great for keeping me on track
well done for posting its the first step
Nat
x

lynzpower · 24 August 2006 at 12:26PM

I agree, an SOA is a really good place to start.

Also only 10x 100 overspend leaves you a grand in debt.

Once you start trying to pay it back, only do you realise how hard it is. But how it can be done.

Welcome

david_hellier · 24 August 2006 at 12:44PM

Hi,

You really shouldn't blame yourself for this. It's a situation most of us have been in. A lot of overspending is due to the banks' poor management of accounts and the doling out of credit, willy nillie.

The banks are not able to help us get out of the mess; it's their business to keep us in a mess. So, the best way is to do it yourself. As lynzpower says start by writing everything down. Be honest. It may hurt first but it gives you an immediate sense of control.

Let us look at the figures and we'll help you shine a torch beam through the cloud.

Good luck.

kathfisch · 24 August 2006 at 12:47PM

Try keeping a spending diary - write down absolutely everything you spend every day, no cheating!!! This will force you to face up to what you spend your money and the habits you're in. Also you may well find yourself thinking twice about some spending because you know you can't ignore and deny it - you have to record it in your spending diary (a notebook will do for this, or an excel spreadsheet that'll do all the adding up for you

).

The next step is to do a statement of affairs - the current situation of what you have coming in and going out (every penny of every type of income and expense). You can use martin's budget planner (top of the page) for this. You'll find out exactly how much you're overspending by and hopefully be shocked into action!! Then we can all take a look and advise on how you can reduce your outgoings :j

msmicawber · 24 August 2006 at 1:16PM

My lightbulb moment was when I found that I couldn't rent a house for my children and myself without a guarantor as I had such a bad credit record. My father had just died, and my mother kindly agreed to be my guarantor, but I was in my 30s and felt a complete failure. It felt so demeaning not being able to put a roof over my own children's heads without running to Mummy. I was determined to get out of debt and get a decent credit score and the lightbulb is still shining bright.

flowerofscotland · 24 August 2006 at 1:28PM

I'm very new to this and am in a much worse position than you but I found that the snowball calculator was very useful as it spells out how long it will take to become debt free - even using snowballing techniques.Good luck - I'm sure you've taken the first step in recognising that you have a problem (it's the equivalent of My name is ..... and I'm an alcoholic!)

pms · 24 August 2006 at 2:59PM

Hi Kerry

My lightbulb moment came when I realised I could no longer keep up with my loan and credit card repayments.

I know what its like to spend even when you know you cant afford to. I did exactly the same and landed myself in such a mess, thankfully now got myself sorted out and having told my parents over the last few days (hardest thing I've ever had to do) and feeling really crap. I am now feeling alot happier having talked things over last night with my parents now have an action plan in place to try save some money (my biggest downfall is I have never been able to save money). That is all going to change.

I get paid next week and am also going to be starting a spending diary, I already have a little notebook bought to keep in my bag to write everything down that I spend.

As others have said a SOA and a spending diary will help you see exactly where your money is going. I've only found this site a few days ago but already it has been a huge help.

Good Luck with clearing your debt

lovelybirchtrees · 24 August 2006 at 4:29PM

My lightbulb moment came when I lost a large contract and realised that there was no way I could pay the required minimum payments on my loans and credit cards.
Although I am married most of the credit and utilities were in my name as my OH had had two years of unemployment and then at 61 returned to uni to train for a new career. When he needed tools (he was doing Furniture Conservation and Restoration) or such, I just gritted my teeth and looked for more work. Then I would buy 'treats' as I was working such long hours or we'd go out for a takeaway as I was too tired to cook. Last August (he graduated in July) I discovered that the total was £40,893.09. Anyhow, we went to Payplan and so far have paid off over £6000. I am cutting pennies everywhere I can and I will win. But, I never expected to have a student debt (OK it's my OH's but the signature on the loans is mine as he wasn't earning) at 62. Sigh. Will I ever retire???

A spending diary helps and also looking at why you are spending. It ain't easy but it's possible. I was actually advised that bankruptcy would be possible as we live in tied accommodation (another job) and the car is a 1992 Honda with 190,000 on it. But I felt I'd taken on the debt and it was my responsibility to pay it off. OH is helping but new businesses take awhile to get going.

amosworks · 24 August 2006 at 4:47PM

Hun, budgets are stupid. They don't really work and only serve to make people worry about money before they spend it, as well as afterwards.

Read the David Bach's "Automatic Millionaire" book which shows you how to pay off debts without stupid budgets.

Annie_Fanny · 24 August 2006 at 4:54PM

Please post a Statement of Affairs (SOA):
http://forums.moneysavingexpert.com/showthread.html?t=107280

The above link will help you prepare one.

Taking the plunge and confessing!

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