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.

Anything which has interest should be stopped and make a payment plan. Contact the loan or card company direct or go through step change. Contact the debt company and make an arrangement as above. Don't offer more than you can afford. Advantage of dmp is it's all in one place. You will get there, but get all your numbers together.

Google your local citizens advice bureau or community debt advice centre.
They really help x

Open all your post.

Make a list of your creditors.

Go through the last year of bank statements.

Only when you get a clear view of what's happening can you decide what to do.

I think step change might be age restricted though. I heard it’s for under 25,s

I can't believe people are hassling the OP for not having pet insurance when she doesn't even have HOME insurance!

OP you must get this sorted, it's not too expensive really.

Stepchange isn't age restricted. They were incredibly helpful to me.

OP. I understand that debt is scary and you want to hide from it, but the ONLY way to deal with it is head on. You need to download the spreadsheet as suggested, and list every single thing on there that you need to allow for each month.

You need to lists all of your debts and then look at how much you have spare to pay them. Prioritise them, and then pay off as much as you can each month.

As others have said, I really do not understand why you won't consider Stepchange or CAP. They are there to help people like yourself. You keep saying that you do not want a DMP and that it will impact on your life. If you continue to ignore the situation and end up going bankrupt, that will impact far more than a DMP. A DMP may affect your credit, but not paying your bills will affect your credit rating far more than a DMP.

You need to look at all your bills and see if you can reduce them. You need to buy the cheapest brand of everything and cut all non essential costs. My landline phone/broadband with Vodafone costs me just £29 a month.

If you have any tv packages such as Netflix or Sky, cut them off and just use freeview. Can you split your council tax payments over 12 months not 10? My council allows this.

Play the long game and get on the price comparison sites when it comes to renewing essential utilities.
You need to look at all your bills and see if you can reduce them

In general you can't move provider while you owe money to the old one though, so may not be quite so simple for the OP.

I'm not sure if anyone's suggested it already but you could also get a part time job in addition to your permanent job to increase your income a bit.

I definitely agree that writing down all debts, prioritizing them and tackling them one at a time is very helpful. I've done this before. Some people call it the debt snowball and it is very effective. Just make the minimum payments on everything but pay as much as you can on the smallest sum so that one item can get knocked out ASAP. Then, you take what you were paying on that and apply it to the next smallest sum, etc. I've been there. I paid off ~£40,000 of debt this way.

I've also taken in a lodger (I understand you cannot right now but think about it when the time is right) while also working two jobs and every bit helps. The lodger got on my nerves so bad but thankfully it was just a temporary solution to help the bigger picture.

I forgot to mention that the biggest priorities is to pay any debt that is backlogged first before doing the debt snowball. The most critical ones being items you need to live (housing, electricity, etc.)

I know how it feels to be stressing constantly about money, worrying about who is phoning you and how you’re going to get to the end of the month. It’s horrible!
I finally faced up to my debts and went to stepchange they were brilliant and it literally transformed my life! I’ve been on a dmp for 7 years and I’m just about to end it. I can’t tell you how good that feels.

Ring stepchange...a dmp may not be for you but they will be able to help.

Good luck.

Why do you think you have £600 a month to spend?

Nett income £2050

Outgoings:

Mortgage - £800
Electricity - £200
Council tax - £100
Car insurance - £70
Mobile phone - £40
Internet - £40
Petrol - £300
TOTAL £1,550

BALANCE - £450 per month

I think someone else asked you about your car but I don't think you answered. Looking at your costs, I think you are running quite an expensive car - could you sell this and buy a smaller, more economical one? For example, I have a Skoda Citigo - it costs me around £20 a month in insurance and does about 60mpg - so it does around 400 miles on a tank of petrol which costs about £38. How long is your commute - it is either hundreds of miles or you are running an expensive car for petrol to be £300 a month.
Are you paying off a car loan - a smaller car would hopefully reduce the cost of that too.

Likewise your phone - I know £40 is not unusual for a contract but as you have broadband as well you don't really need a lot of internet on your phone - could you buy a cheap second hand phone and get a low cost SIM - for example 3 do one for £5 a month.

Also everyone telling OP to get rid of her phone is usually a waste of time is usually pointless as the majority of people are tied into contracts.

OP I think the lodger idea is the most useful and I've done it. Ask for rental upfront and sort out the shower and oven. How are you eating and washing without these anyway?

1. Make a list of who and what you owe- you can’t do anything until you’ve done that.
2. List outgoings
3. Ring everyone on 1. Tell them your issue- don’t avoid or ignore they don’t go away but having a chat may give you more time to repay
4. Prioritise repayments and outgoings-£40 mobile bill could be cheaper really
5. Then you’ll just have to savy food shop etc for a while.....

Sorry I haven’t read the full thread but do you have a spare room? When I was struggling I got a lodger who paid £350 per month (you might get more depending on where you’re based) it made a huge difference. Good luck with everything

Why is your car insurance so high?

Re your mortgage - can you switch to a better deal to reduce your monthly payments? I switched last year and got my payment down from £850 to £700 so a saving of £150.

Can you also switch utility/mobile/internet providers to cheaper deals if you don't owe money on your accounts.

Do you have old unused household items & clothes that you can sell on schpock to raise cash? Use any money raised to pay towards the outstanding amounts.

Can you switch your grocery to Lidl/Aldi or to own brand?

I've got half way through posts so sorry if I repeat.

That debt really isn't huge... You would repay the whole lot in under a year if you didn't eat. Now I know that isn't feasible, but shopping at Aldi for a single household and two pets should be no more than £50/60 a week.

Depending on what your job is, you need to be careful for any debt arrangements as this could negatively impact your job, especially if you have a financial related job.
I will echo other posters and say ANSWER THE PHONE TO THE DEBT COMPANY then you know where you stand.

Make sure you don't have takeaway lunches or coffees, and cancel all meals out til you know you can afford repayments and still manage to eat out, even though it would take longer to repay everything.

Good luck, and if you need help creating a spreadsheet to budget everything give me a pm... Love a spreadsheet

Not sure if it's been mentioned already and I can see you're getting loads of advice about the bills but regarding cat food. I use Amazon subscribe and save for cat food and litter. Mine will only eat Gourmet and it works out at 15p a pouch instead of 40p. I get World Famous cat litter and it's nearly £50 in Pets at Home but £25 from Amazon

Hope you get sorted

www.moneysavingexpert.com/loans/check-free-credit-report

This lets u check your credit report for free. All the people u owe money should be on it so it will tell you who u owe and how much

Courage. You will get through this and it is never as bad as you think. Don't hide from it, you seem like a brave and resourceful person so getting on top of the information without getting depressed about it is the first step in sorting it out. Get all your bills. Put them all in date order in a file. Put them on a spread sheet . what you owe. what your payments are. Try not to worry and panic as you do this. You will be more in control when you've done it. I'm concerned about the bills that are "popping up".. Get some help with this. Especially about the company that is pestering you. Sometimes people sell on debts and you might need some help to get them to go away. As everyone has suggested Martins Money Saving Website. He has lots of advice for trimming your outgoings where you can. Remember you can only do what you can do, you can't solve it over night but you can take charge of it and move forward with a plan. You can do this and you will be proud of yourself further down the line for conquering it.

I have a sim only contract - £8 per month and plusnet landline calls and broadband £30. Would either of those be helpful to you?

Sorry I haven't read all of the comments, it may have already mean mentioned.
But I saw that you said you couldn't afford home insurance. You can't afford not to have it, you would still owe your mortgage company if (god forbid) your house burnt down. Please find a way of buying a policy.

Ok the most important debt is your council tax - as it’s a tax it can go from not paying to bailiffs in two months and as it’s coming up to year end this debt you need to pay first

Get back on the phone to the electric company and cry, wail and sob to get it reduced further

This will give you breathing space for other debts coming in

Get any spare room on spare room and get yourself a lodger- the cash will be tax free and you can use it to pay debts of each month