To think I’ve really fucked up - not sure what to do

[frostedstrawberries]

After a long period of temporary work and sometimes not getting any work for periods of time, I finally got something permanent in January.

I’ve got a big backlog of debt, though, of things that I hadn’t paid for a while because I couldn’t when I wasn’t working.

So now my take home pay is £2050 after tax NI etc.

But my outgoings are:

Mortgage - £800
Electricity - £200 (it’s so high because I’m repaying a backlog)
Council tax - £100 (I owe money on that too)
Car insurance - £70
Mobile phone - £40
Internet - £40
Petrol costs are sky high due to long commute - £300

So in theory I have about £600 left to play with. But it just vanishes. I have pets eating me out of house and home and I have wondered about possibly finding alternatives for them but I just couldn’t. Every day I have phone calls about debts I didn’t even know I had springing up seemingly out of nowhere. I am well aware I am a complete disorganised mess with it all.

I really, really don’t want to go down the route of a DMP - what are the alternatives? I naively thought all would be OK once I started working, but it’s not.

I was in your situation up until last month and here's what I did:

1. Signed up to a credit score website (30 days free - cancel before this ends so you don't get charged!)

I could see clearly what debt I had and what I had defaulted on etc.

1. Joined the electoral roll - that way debtors can find you! I didn't know who or what I owed as credit providers had enlisted various debt recovery agencies that way they could contact me.

1. Ensure your address is updated/correct with your bank, credit card and any debt providers that you do know of.

1. I know the phone calls etc are worrying you. I did not answer and only acted/answered when they sent me a letter. All of these letters gave me an online option to propose my monthly payment amount/set up direct debits etc. You also have the option to email/send letters. I didn't once have to speak to anyone unless I wanted to which if you're scared and embarrassed is such a relief.

1. Set up a spread sheet with outgoings (Meal plan but if you live on pasta for the next 5 months do it!) Ensure as the letters come in that you list the companies and the amount of debt and update each time you pay - a clear picture will give you confidence.

1. Next is individual to your circumstances but you could advertise a room on somewhere like Spare Room for a handyman - instead of charging room rent for a while they could fix the things that need fixing - imagination required! Ideally you could get it so you could rent these rooms out and you could rent a room closer to work mon-fri but still have someone at yours to feed the cats etc.

1. Sell anything and everything that you do not need - be brutal. Even if that means a cheaper to run car. (On this note make sure your tyre pressure etc is correct as this effects fuel! Sainsbury's air is free!)

1. See if your company do a season ticket loan for travel - it maybe cheaper to take the train and the loan is tax free.

1. Look for weekend work - local pub/Saturday job, night work for Friday/Saturday nights. Sleep in or waking night at small residential homes are ideal. You aren't going to have much of a social life anyway with no money so instead of wallowing at home stressing you might as well be working!

The last point made the biggest difference for me and in a year I managed to clear the 7k I owed.

Positives:
It's amazing not waking up in the night worrying about bailiffs etc.
I discovered Lidl/Aldi
I still work weekends and will soon have a little bit saved, the anxiety about what I would do if the car broke/flat tyre/vets bills etc will hopefully be limited soon!

Negatives:
I still hate Weetabix and pasta after living on them for a year
I watch everything I spend and find it hard to spend guilt free - I'd now rather work a Friday night than go to the pub and 'waste' money.
My credit score will take 6 years to recover (I have got a credit building card), it's great that you already have your mortgage!

Do you work set hours / days OP? If so is there a possibility of getting a second job on a temporary basis for a few months (or overtime at your current job)? Say if you currently have a Monday-Friday basis could you look into getting a Saturday job or something, or work two or three evenings a week? Have you considered doing babysitting for example which is usually weekend / evenings? Even if you could get an extra £100-200 a month it'll help to start to clear the backlog of debt.

You have said that you don't think a DMP is for you, in fact you are exactly the person a DMP is aimed at. You have disposable income but are struggling to budget, this will sort that out for you. Stephanie wouldn't have been able to help while you weren't working or had no disposable income, they need a figure to work with. Call them again with your new circumstances, they will help you

laudanum back off. The OP is stressed enough without folk having a go at her. the OP came here for help not a lecture. Always remember there but by the Grace of God and all that.

Your debts are not insurmountable (just remember that) so the spreadsheet is a very good idea. However scary check all your outgoings and take it from there

You need to make an appointment at your local money management place. The one here (Plymouth) is called Money Advice. They were amazing getting dents written off or frozen for relatives of mine.

You are in employment and you can get yourself out of this. It could be much worse please start getting your control back x

How many cats do you have?

We have 13 of the fussy little fuckers and manage to feed them for £50 per month. And the would ALL rather starve than eat Aldi's own brand food!

We bulk buy this food from zooplus and the love it. www.zooplus.co.uk/shop/cats/dry_cat_food/sanabelle/eco_packs/541100

Another recommendation for CAP here (and I'm an atheist!)- they really helped a friend of mine recently, I'm sure they'll help you work out exactly what debts you have and help you to come up with a plan from there. Once you've worked out exactly what you owe and everything is out in the open, the only way is up!

Good luck OP.

No idea where Stephanie came from! Autocorrected Stepchange 😂

I would highly recommend CAP. Martin Lewis speaks very highly of them. They will negotiate with all your creditors. Anyone you have debt with should be writing to you so you should have correspondence. They work out what you need to live and then you pay them a set amount each month which they use to pay your creditiors. Takes the pressure of you and you pass any correspondence from creditors to them and any phone calls you tell them that you are now with cap and they need to speak to them. It has to better than how you are living right now with no light at the end of the tunnel. Lots of creditors are also used to dealing with Cap and will be happy that you are actually dealing with your debt by using them.

You seem deadset against a DMP despite many posters telling it is probably the best way out of your problems. Sugar is correct. Step change would not have been able to help you before, but they will now that you are working. If not them, then one of the other debt charities that has been recommended on this thread.

I know that it is hard to see any way out sometimes, but seriously consider a DMP instead of constantly dismissing it as not for you. As Sugar said, you are exactly the kind of person that it will work for.

As a PP said, I had my first night's proper sleep in years after sorting out a DMP. I was finally in control and that makes a hell of a difference.

Christians against poverty are amazing and a free service (many other services charge!). They will be the middleman between your debtors and negotiate for you, so no more phone calls etc.
(And you don't need to be a Christian!!)
capuk.org/

Contact each debtor, provide them with an income and expenditure statement and make an offer to make a monthly repayment - some will accept as little as £1 per month

Op I hope you don't mind me posting here..

I just wanted to say thank you to everyone on this thread. I've just read through fully. I'm in a similar situation to OP. This thread and all of the advice given has just motivated me to sit down this afternoon, open my post and stop avoiding my own debt.

Op, if you want someone in a similar situation to buddy up with, drop me a PM.

As far as I can see, a DMP would have quite serious and long term repercussions to my credit.

I’m not being ungrateful or arsey. I really do get it’s frustrating when you sense you have the answer and someone won’t take it but I just don’t think it’s right for me at this time. It’s also very hard because if I remember correctly, stepchange has a number of questions that I just can’t answer.

Well done CMH123. It is so scary to begin to deal with debt, but it's definitely worth it.

You’ll get there, OP. You don’t have to get there in 5 hours, though, and whilst you may owe a lot of people some money, you don’t owe us anything Take the advice you see can help, ignore anything but relevant. Good luck

Thanks, Squirrels that reallg is helpful

Any debt will have long term repercussions on your credit rating. A DMP will enable you to budget and pay the debt off. A default stays on your credit file for 6 years, arrears for 1 year. If you pay the debt off then it can be marked as satisfied on your file. I have no idea what questions Stepchange will ask that you can't answer - they need to know income, outgoings, debts - of you don't know what you owe then tell them that. Additional debts that come to light after the DMP is set up can be added later, it's not a deal breaker

Yes, I understand that sugar but a DMP is still far more serious than a default and I do think it’s a bit disingenuous to present them as identical. I got into this position because I wasn’t working, now I am working so I can hopefully sort it. People have helped by reminding me I’ve only actually had one instalment of my salary thus far.

Honestly, it's not. I worked in debt recovery for a large organisation for a long time, a DMP is really no different to defaults. In fact a DMP shows you are making an effort. An IVA or DRO is more 'formal'

OP, I think you're just downcast because you thought that the job would fix everything and now you're discovering that it hasn't. But it will in the long run - it takes time! Hang in there.

You can actually do your own DMP- it's not registered anywhere

Stepchange go through everything again after a few weeks. Just in case there's been a change in circumstances or new debt comes to light. The only thing I didn't agree to was closing my bank account and opening another. I cleared off my overdraft before anything else and removed the option for an overdraft. My bank account was hard to get and I can't manage on.a cash only card.

OP, your debts aren't really that big now that you have a regular job. (I once had credit card debts equivalent to a year's gross salary). Once you have cleared the mortgage arrears, council tax and electricity debt, things should be a lot more manageable.

It is really hard to start getting a handle on things when it seems like one huge mess. It might help if you just started on one bit of the problem, so that you're only dealing with a small thing at a time.

If getting to the bottom of what you owe is scarey (which I'm sure it is), just work out your current outgoings, then see where you can claw back a bit of spending.

If you're spending £300 a month on petrol, I reckon you're using around 250 litres of fuel a month. Saving just 5p a litre by filling up at the cheapest place possible would save £12.50 a month. When I practised fuel efficient driving, I reduced my petrol consumption by 10%, so if the same works for you, that's quite a significant saving.

Even if you buy a meal deal sandwich lunch, that's £3 pd, £60+ a month. You could reduce that by 50% if you took a packed lunch to work.

Try having a month where you don't buy anything that isn't essential and that doesn't have to be bought right away. We do this every now and then, and we can reduce our shopping bills from around £300 a month to £200. Buying cheaper alternatives like own brands can really help here.

That will help you feel a bit more in control of things, when you find that you can cut back, and then you might feel able to address the question of overall indebtedness.

When you do that, remember that that global total may seem huge, but for a lot of those things all you have to cover for now is the minimum payments for most things.

Speak to your mortgage company and see how little they will accept towards your arrears. Do the same with your electricity supplier - if you've been paying £200 a month for a while, your debt should have gone down a fair bit. Also check your last statement and make sure that they got a meter reading. If you've had estimated bills for a while, check if they've been overestimated (ime they usually are) and give them a reading so they can recalculate the bill.

Your council tax debt should be nearly paid off after a couple more months, then it should go down a bit. Make sure you're getting the 25% single occupier discount.

Taking these small steps will help you feel more in control, which will ease your anxiety. Then you can start looking at getting a DMP in place for dealing with the rest.

Oh, and check you're not paying fees for your current account: one of my clients had been paying £10 a month for theirs, because it included travel insurance. She never travelled abroad, so it was just a waste of £120 a year, and she'd had it for 5 years!