Just taken out a huge debt consolidation loan

[Debtandmoredebt]

And it’s really made me feel terrible. Fucking cost of living crisis. Anyone else who’s had to do this, did you manage to pay it off earlier? Does it get easier?

I won’t be debt free for 8 years if I stick to the schedule.

Just a combination of really bad luck and the cost of living has screwed us financially. Hopefully this is the first step on the way to being back to ‘normal’ but it’s really crap.

Yep- been there. Have to say it didn't really solve the problem. But- i don't recall any other alternative. I'm sure we are not the only ones!
Isn't life expensive.

This is madness.
You can't borrow your way out of debt.
Try to cancel this and go to MSE Debt Free Wanna Be on Martin Lewis' site.
Best of luck though. You must be at the end of your tether. Mx.

I consolidated debt and paid it all off in seven years. I learned from my mistakes during that time and haven't gotten into much debt since. Worked for me. I hate being in debt.

I was the same. Large consolidated loan that took a good few years to pay off. But didn't run up any other debts in that time as I learnt to budget. And have continued this since. It's been a decade now. However, as well as the loan you need to make sure you will not get in to debt again OP. That's the key to making this work. Good luck 🤞

We didn’t really have a choice sadly.

I had about 5 loans, all for shit things like fixing my house that’s falling to bits (proper falling in with no hot water and not even being watertight) broken cars, me having a period of time off work with a life changing injury, just bad luck. The monthly payments were crippling and this has reduced what’s going out per month by about £300 which we really need to float financially right now.

Not one bit of the debt was anything nice which is even more annoying! No holidays, fancy extensions etc

What other options were there out of curiosity? Although it’s done now as I’ve paid off all of the loans I don’t think I could unpay them could I? 😬

Watch Dave Ramsey on YouTube. Look at how you can pay the consolidation loan off early. Maximise your income.

Are you able to work following your life changing injury? Are you due any compensation?

Our only other option was bankruptcy which we really wanted to avoid. A consolidation loan was the best option for us as we could afford the repayments and not get in to more debt as we were left with enough to live on.
You've done the right thing - many people bury their head in the sand but you've taken action.

And ours was similar stuff - job loss, house repairs, broken cars. The day to day can add up frighteningly quickly.

Very similar happened to my parents several trips round the debt consolidation roundabout with too easy to get back into other sources of debt but after oweing 90k it got paid off eventually.

I am back to work now thankfully. Very grateful to be too! I had 2 maternity leaves in a row, followed by about 8 months off work unwell which meant I was on SMP and then SSP for a long time! I hope I can also turn things around @UngratefulOldCabbage

I have looked into compensation but am not entitled as I can’t prove negligence or anything that so I’ve decided to just try and make my peace and move on. I don’t know if I have it in me for a big fight, I’m so worn down by it and am just grateful to be able to do things again.

It’s happened scarily fast. Just rubbish things like house maintenance that couldn’t be left and a car that died while on finance that I’m still paying for despite not having it anymore, but it just keeps happening over and over again. Any time I get pulled round it starts again.

I’ve got children and I wanted to be able to enjoy nice things with them again rather than constantly saying no 🙁 I don’t wish to get more debt again. I did think about putting it on my mortgage but that’s even scarier.

I will look at Dave Ramsey, thankyou.

90k! Amazing they managed to get there in the end.

I owe £18k which is enough to keep me up at night for the next 7 years 😩

It happens, you've restructured and you know what you need to do. Don't blame yourself, life is expensive.

Crikey OP, I thought it was going to be 10s of 1000s not £18k!

First thing you've got to do is stop beating yourself up. Shit happens in life but you've faced up to it and now you're taking control.

Ramsey baby steps, Money Saving Expert and Meaningful Money are all excellent resources.

Scary how much debt could be accessed in the 80s 90s - they were the same as you though we didnt have fancy cars and holiday in Disney it was through trying to give my brother's and I a good childhood a sense of mum should be house mum etc.
You'll get yourself through it.

We were £37k. Scary scary amount. But it's doable. You just need to focus on getting it cleared and living within your means from now on. You can do it!
I was never taught about money, budgeting, debts etc. I now take pride in living within my means, saving a bit each month, and educating my DC about money and life skills to help them do better than I did!

£18k is totally doable in under 8 years- can you overpay the loan early?

Thankyou everyone it means a lot to hear positivity! I’ve just been feeling sick for months over it.

I am planning to try and overpay as much as I can. It’s so hard as there always seems to be something wiping out my savings so I never get very far. I need to properly budget but I’m terrible at it.

I was going to try. Unfortunately my mortgage has also increased by £300 this month so it’s making everything much tighter (and it’s why I urgently had to consolidate to be able to afford it!)

I owe £2.5k but I'm not allowed to work until the doctor says so following a disease and the aftermath! So it feels like tons to me, it's relative.

No it's not a nice feeling but persevere and you'll get there.

OP - budgeting properly is essential. Go onto MeaningfulMoney.tv and there are excellent resources to help you with budgeting and other aspects of finance.

All the best.

£18k is very manageable as long as you have the disposable income.

However, you need to get on top of budgeting and plan for irregular expenses or else you'll struggle again and risk needing to take out more debt because you have an expense that you've not anticipated. This is very very common for people who take out consolidation loans. They think they've 'paid off' their debt and all is well but then it all falls over when their car needs repairing or the washing machine dies.

So you need to have a really good look at your budget so you know what you can afford on paper and put aside savings for expenses that will crop up regularly over the year, so car servicing, MOT, insurance, white goods replacement, school uniforms, Christmas, extra costs in the school holidays, etc etc. Don't think of this money as savings in the sense of it being genuinely spare money, because it's not going to build up long term, it's just like all your other bills but they're not due just yet.

Moneysaving Expert will walk you through this and also give suggestions for increasing income and cutting costs, which will then increase the spare money you have for bills, fun stuff or to overpay the loan.

https://www.moneysavingexpert.com/family/money-help/

Good luck!

I owed £10,000 and consolidated it into a loan. It really was the best thing I ever did. It's paid now and I have no debt and it's changed how I am with money.
You've really done the right thing.

Dave Ramsay is worth looking at because Americans on his show often have insane levels of debt. A real eye opener.

Thankyou everyone. I’m going to spend today budgeting. On paper I seem to have enough money but I never do, I’m always struggling at the end of the month or ‘dipping’ in to whatever I’ve put aside.

I have no savings at all. This is the reason I got into debt into the first place. The majority of expenses on the loan were big ones though, 8k on a roof and that type of thing rather than a few hundred. I’m not sure I could have ever saved that. I bought a renovation property and can’t finish it. The costs spiralled massively (aspestos, full rewire, needing re plumbed to name a few) so I have been taking out finance left right and centre to do work. My initial budget got wiped out pretty quickly. I now have no means to finish it but I am watertight and have heating etc so thinking it’s probably best to pay the loan and then save…but it means leaving the house for another 10 years or so. How people do it I’m not sure.

I was planning to overpay by about £50 a month. I know that’s a tiny amount but I was hoping it would at least take a year off!

I would really recommend money saving expert's debt free wannabe forum for cases like this.

You need to find a method of budgeting that works for you. For me, that's:

1. Paying myself first - so for you that would be paying the debt consolidation and a sum towards an emergency fund so if you needed roof repairs or a new washing machine you could afford it. Once you have worked out your budgets you might increase this category.
2. Savings pots - these are pots I pay into regularly as part of the "pay yourself first" principle to make sure I've got the money for everything I need. My pots are quite chill because I'm not budgeting closely - so I have short term, holidays, medium term. But if I were in your position, I'd cut out the holidays and the medium term pot and have more explicit pots dividing up short term - e.g. Christmas, Birthdays, Annual Bills. So you look up how much your MOT cost last year, and add a bit on, add your car insurance and anything else you pay annually like a boiler service or whatever and put it all in the annual bills pot.
3. Everything else - this is where you've got to be really careful - you need to budget for everything from haircuts to new clothes, from your Netflix subscription to public transport. The key here is to account for everything so you can see how tight you think things are. And then when times are good you can be quite relaxed about these, but when times are tight you see that unfortunately you have to set aside time to categorise every spend and see where the money is going and so you know at a glance whether you can afford something or not.

Longer term, it's worth considering the medium term pot that I have - this covers necessary but non emergency house repairs, when I need a new (to me!) car or new appliances etc. It's probably not affordable for you to save into this right now - but maybe once you've built up an emergency fund it would be something to consider.