I want to clear every last penny

System · 11 October 2018 at 10:10AM

A quarter of your income per month goes on a car? Wow - you need to see if you can give this back!

Chandelier. · 11 October 2018 at 11:16AM

Morning and welcome to the forum!

You seem to have hit your LBM in regards to your debts and you just need a clear plan in place to tackle these. It will take time but it will be over before you know it and then you can concentrate on saving for your future.

I would carry on paying the minimum payments to others but would tackle the debts as followed.

The first thing I would pay off the Argos card (£300) as the interest rate is extortionate. That would wipe out one debt, leaving you with five more to go. I would also close this account so there are no further temptations.

I would then throw as much money as possible to the Barclay credit card (£500) and once that is finished you then only have four debts left.

Personally the next thing I would target would be the overdraft to get that out the way and to avoid the overdraft charges each day, leaving you with three debts to go.

I would then split repayments between the Santander CC and HSBC.

In regards to the Santander CC is there anyway you can get a 0% balance transfer to transfer as much as possible towards it to give you a bit more breathing space? That is one option I would explore. Whilst doing this I would also dwindle the HSBC CC down as much as possible with the hope once the 0% offer has finished, you could hopefully access another 0% promotional offer to avoid accumulating as much interest as possible.

I would leave the loan to tick over and once you have paid off most of your debts, you could then snowball this along with your other repayments. If I was you I would round it up to paying £50 per month so it brings it down a little more each month.

Personally that is the way I would tackle these debts.

Have a look if you are able to access any more 0% balance transfer offers, more so to transfer to Santander CC over.

Good luck!

claire123c · 11 October 2018 at 11:40AM

Hi, do you work for the NHS/have the same car scheme as them? If so you can give your car back at certain points. My husband did and actually received a refund (i have no idea why but it was something to do with unused mileage?) anyway, you could really save yourself a lot of money by looking into giving this back. There are definite pros for salary sacrifice ie maintenance costs are in with it though, its a tough one!

I agree with previous posters in that:
Dont ask your parents for the break. £60 a month is amazing. I know you know that won’t cover your costs, but it is a help to them and a help to you. Keep paying it and help them out with chores/cooking them meals where you can to show gratitude
Pay off the argos card first and in one go!! Mentally you will feel so much better eliminating one debt (trust me I know!)
Follow the previous posts to snowball debts and if possible find a 0% card in future to transfer. Sometimes mentally it is what you need ie no interest and the less payments you have the better you feel.

I had success taking out a very low percent loan and combining my debts into one but this is not always the best option for people, nor may it be an option for you now on your wages. However, the point being having a clear and strict plan with set amounts for a set time works wonders. Yes you do look forward to payday and ‘coast’ 😕 but think how great you will feel in the future. Good Luck xx

redux · 11 October 2018 at 12:53PM

Chandelier. wrote: »

The first thing I would pay off the Argos card (£300) as the interest rate is extortionate. That would wipe out ...

Personally the next thing I would target would be the overdraft to get that out the way and to avoid the overdraft charges each day, leaving you with three debts to go.

If the Halifax overdraft initerest is not waived and it's charging its usual rate, that works out to over 60% apr, which is why I suggested check it and if so do it first.

fatrab · 11 October 2018 at 1:21PM

redux wrote: »

If the Halifax overdraft initerest is not waived and it's charging its usual rate, that works out to over 60% apr, which is why I suggested check it and if so do it first.

OP states £315 outstanding at £45/month until April, which is 7 months x £45 = £315 suggesting no interest.

Duh18 · 11 October 2018 at 5:50PM

Hi

Your right 0% interest promise to pay. I am using gym as my down time when I’m coasting haha! As the previous poster said in 6 months I could be in a lot better place :money:

zippygeorgeandben · 11 October 2018 at 10:44PM

Have you considered starting a diary? If you are serious about sorting out your debts for the long term (and then you can move onto actually saving!!!) then you may find it exciting to come on here and have people spurring you on. I wouldn't call it coasting but you're paying to have an easier life later on.
You're so fortunate to only pay £60 to your parents, don't ever take this for granted, it may not be around forever!

Duh18 · 12 October 2018 at 12:48PM

Hi

Thanks for the advice, I have just started on in the diary section, here goes!

enthusiasticsaver · 12 October 2018 at 1:08PM

Duh18 wrote: »

Hi

I am new to the board after discovering MSE online when searching for help. I had a pretty bad break up 2+ years along side a job I was extremely unhappy in which looking back was a combination for a disaster. 2 years on and I’m in a new job and feel a lot better about myself however still following me around is the large amount of debt that I have amounted over the last 4 years more so in that 2 year period. I am currently 24 and want to have this debt cleared in the next 2 years to stand myself in good stead from 26 onwards in regards to mortgages savings etc. I’d appreciate any help as and where.

I know people advise SOA but here goes as I live at home with parents so many of the columns aren’t relevant.

NET salary £950.00 (£1250.00)
I have a £300.00 salary sacrifice car which finishes in March 2020.

Contact Lenses £20.00
EE Phone £45.00
Gym (12 month contact till August 2019) £30.00
House keep to parents £60.00
Petrol £50.00

£745 remaining

HSBC credit card , £6,300 (0% till December 2019 then 21.9% onwards) £160 min
Santander credit card £3,000 18.9% £80 min
Barclaycard credit card £500 (0% till December 2019 then 34.9%) £10 min
Lloyds refinance loan £2700 9.9% £45 min (79 months remaining)
Halifax overdraft £315 (£45 a month repayment plan till April 19)
Argos Card £300 29.9% £20.00 min

£385.00 left, where do I start?

£13,100 to clear :(

Even writing this post feel like a slight weight has lifted off my shoulders

First I would check that you actually have £385 a month left as presumably you need to live too. Saving car maintenance money as well is a must as you have a car which needs servicing, maintaining etc. Ideally you would not be spending £300 a month from a relatively low salary for a car but once the debt is cleared focus on saving so you have money towards your next car rather than borrowing it.

You are paying £360 in minimums but of that £385 spare I would keep maybe £25 per week for living expenses (entertainment etc) and save £85 towards car costs etc and put an extra £200 to clearing the debt so you are paying £560 a month towards it. If you go too brutal and leave yourself with no spare money each month you will quickly get disheartened and be tempted to spend on a card. You can always save it and keep it back to make a lump sum off the debt if you find you can cope without the £25 weekly spends.

So month 1 I would put the extra £200 to Argos and with the £20 minimum that brings it down to £80 plus whatever interest is charged. If the interest is not yet being charged put it to Barclaycard instead to clear it by December when the very high 34.9% comes in.

After Argos and Barclaycard are sorted tackle the Santander card then HSBC.

Wishing your life away is very common when tackling debt. However you are tackling this while it is still doable rather than having to face much harder problems like bankruptcy or DMPs which affect your life for a lot longer than the 2 or 3 years it will take you to clear this. You have low living costs thanks to living with your parents and can turn this around while you are young. It is important to realise you have spent £13k of money you did not have and repaying it takes at least as long as it took to borrow it so over a period of 2 - 4 years.

Good luck.

enthusiasticsaver · 12 October 2018 at 1:14PM

As fatrab says look for free things to do. Don't buy lunches out, maybe pick up some rolls at the beginning of the week with a sandwich filler and multipack of crisps etc. Lunch deals at £3.50 per day which many people go for works out at £70 a month you could save. Fill up a water bottle each day from home.

I want to clear every last penny

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