I have a lot of debt which I need to pay off and I need help with it (not literally)

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I feel ashamed and sick even writing down the amount of debt I have but I'm finally taking steps to pay it off and I need help from someone who is good with working out the best way to do it.

I owe in region of £20k... I don't even know how I got here but I did.

I can afford to pay £500 a month off. I have managed to spread it out over 3 cards. 1 is interest free for 24 months, 1 is interest free for 12 months and the other is high interest.

Split is:

£8000 - interest free for a year
£5800 - interest free for 24 months
£5700 - high interest

I can't get a card to cover all - I have an excellent credit history, thankfully.

I know usual advice is to snowball but I can't work out how to do this with these cards.

Thank you and if anyone is thinking of coming on here to shame me , please don't, I feel awful enough as it is but want to turn things around.

TIA

So the first thing to do is pay the minimum on the interst free cards and chuck everything you can at the high interest one.

Clear the 12 month IF card next and finally the 24 month IF card.

Thank you :)

How much are your minimum payments on the 0% cards? Can you pay all your minimum payments with £500?

If so, then set your payments to the 0% cards at just above the minimum payments e.g. if the minimum on £5,800 is £149 per month, make the fixed payment per month £150. Do the same for the £8,000 card, a fixed rate just above the current minimum payment. Then you have to put whatever you can towards the interest paying card.

I’m a bit concerned that £500 isn’t enough though. Have you been through a budget planner and accounted for everything and cut back whatever you can?

Here is a budget planner (or Statement of Affairs). Fill it in with everything you can think of.

https://www.lemonfool.co.uk/financecalculators/soa.php

You can then post it for comment on e.g. the dealing with debt discussion board on moneysavingexpert or on Money Matters on this site.

Firstly - well done you! It’s really hard to actually sit down and go through debts and find a starting point.

Can you balance transfer the high interest one to a new interest free card?

OP, please get some professional debt advice. They won't judge and they will be able to help you identify the best way forward.

There will be various national/local charities that can help you with this.

Can you cut any of your other costs, or earn any more money?

Babysitting, change bank accounts, reduce your bills, cut grocery shopping etc etc.

Look on the Moneysaving Expert budgeting advice, as they give tips on how to cut lots of costs. Even a fiver saved is £5 more to chuck at your debts. Question every expense. Don't spend for the sake of it, and don't exchange gifts with other adults at Christmas, it's nearly always a total waste of money.

Concentrate on the higher interest one and pay £1 above the minimum on the others (removes minimum payment marker from your account). Look out for offers to transfer some of the balance if you can't transfer all of it, and check this every few months.

In a year's time you'll have likely nearly paid off the highest interest one, but the £8000 will start to charge interest, so then you'll need to transfer that one again.

Or look for a loan. Read the Moneysaving Expert weekly newsletter and credit cards section as there's a few creative ideas to reduce interest if you can't do a straight balance transfer.

If you minimise the interest, you'll be out of debt in 3-4 years, less if you manage to cut your bills/spending or increase your income.

My sister went with a company who consolidated all of her debts and froze all of the interest and she just paid them an affordable monthly payment.

It does mean you can’t get a credit card, car finance etc whilst doing it but she felt that was a positive thing.

She paid it off last year and said it was the best thing she’s ever done and wished she’d done it sooner.
She said financially she was better off but it was such a massive relief mentally as it was all taken care of and she didn’t have constant debt letters stressing her out.

She’s away so I can’t ask her who she went with but I’m sure if you google it they’ll be a few companies out there doing it.
Its worth looking into.

https://www.citizensadvice.org.uk/debt-and-money/debt-solutions/

This may be helpful.

Stepchange is also a great website and gives really good advice.

I was in the same boat 3 years ago and wrote a post here last month when I finally cleared it all. Honestly, the relief is immense and you WILL get there.

You have to start with the highest interest card so put everything you can into that and make bare minimum payments on the others. Once that’s cleared in a years time see if you can get the 12 month one onto a longer interest free term then spent the next year paying off the 24 month one.

You might not feel it now but you’re in a decent position, you just have to throw every spare penny at it!!

I would be very cautious about consolidation. There are some sharks out there and also many people fall back into debt as they haven't dealt with the underlying spending issue.

Well done for facing up yo the issues. Pay all of your minimums and throw everything spare at the high rate first, then the shorter 0% period so its hopefully clear when it ends, then the longer 0%.

Cut up the cards so you aren't tempted to use them. If you need an emergency card freeze it inside a big box of water in your freezer.

Keep an eye on your credit rating as in a year or so you may find more 0% cards opening up to you.

Thank you all - I won't go for debt consolidation as I will be able to pay it, it's just going to be hard. As I said I still have an excellent credit rating. What I've realised is that when I pay off the high interest rate one I can probably transfer the other one with the interest free for 1 year onto that as I don't pay interest onnew balance transfers (if that makes sense).

@BarclaycardBosh -so good to hear that you did it.