Does this sound like a reasonable plan for sorting my money issues out?

[Moneyissuez]

I have name changed as there are going to be some private financial details on here.

I'm hoping to type out my situation and get some feedback from mners that my 'plan' to get back on track is sound. I'm also hoping for any tips and hints and for people to point out anything I've forgotten. I hope that's ok.

The situation is this: DH and I earn good wages but we're in an alarming amount of debt. We've always paid it regularly so I've not been too worried, but the last few months we've struggled a bit and missed the odd payment. In all, I'd say we're about £500 'behind'. I don't want this to get worse.

Secondly, we don't have enough actual cash to last the month, for essentials. We need another £200 in the next week or so to sort this out.

So, this is what I'm thinking:

Short term: to survive the month I'm going to do a basic shop that will cover this week for food. That allows me a bit of cash to use on matched betting, which we've dabbled in before but never made loads because we are always down to pennies so have no money to put in.

I have a few items to sell, nothing hugely valuable but a I might be able to raise a few quid. I'm going to put a couple of slightly higher value items on gumtree, in the hope that I can make 30 quid or so this week.
I'm going to gather up all the random bits and bobs we don't want and instead of charity shopping them I'm going to do a car boot sale next Saturday.

Longer term: I'm going to spend some time this week speaking to creditors. I've already negotiated a plan with my bank where I'm paying my overdraft bit by bit and they've frozen the interest. They suggested an IVA, I've chosen not to go down that route yet, but see if I can negotiate a lower monthly charge with everyone we owe money to. I'm thinking even if it takes longer to pay, if we can afford the payments each month then we'll be out of this cycle of needing to borrow more. With credit cards I'm going to ask them to close the accounts and just let us pay them back. I don't want this to ever build up again.

So, thanks for reading if you've got this far. Does anyone have any advice? Does that all sound reasonable?

Is either of you able to get a second job in the evening or weekends this could raise quite a lot of money and make a bigger dent in the debt. That's what I would do anyway.

My first thought was also a 2nd job- if you have the time?

Also, I don't know a lot about betting- I know matched betting is taking advantage of the free bets- but is it wise to go down this route incase it causes problems long term if you see gambling as a way to move out of debt?

Have you looked on the money saving expert forums lots of ideas on there.

Can you eat from the cupboards/freezer this week ?

What is your income, what is your outgoings and how big is your debt? It sounds to me like you're papering over the cracks. As for gambling, that's without doubt the worst possible plan for getting out of debt.
You need a long term strategy that's realistic. Contact a debt advisory service, a free one, to get proper advice. Citizens advice should be able to point you in the right direction.

Just found this.
www.stepchange.org/how-we-help/debt-advice.aspx

Have you looked at switching utilities and phone contracts etc?

I'm a qualified debt/money advisor although I'm in Scotland and am assuming you're not as you mention an IVA so can't give you comprehensive advice.

Have you already done a full income/expenditure including all irregular incidentals such as car repairs, haircuts, window cleaning, dentist etc as well as regular bills and a realistic amount for food/clothes/shoes. Once this is done, it will show your disposable income for servicing your debts.

In terms of the debts and the long term plan, I'd suggest writing to your creditors and asking them to freeze all interest and charges and accept a lower monthly minimum payment enclosing your financial statement (income & expenditure). You should distribute your disposable income on an equitable basis, so you pay the most to who you owe thr most too etc. I'm not very impressed by your bank suggesting an IVA, this is bad practice, they are not qualified to offer debt advice and should refer you to a free independent debt advice charity.

Good luck!

Stepchange - linked above work closely with CAB so worthwhile to contact

The money advisory service have some good tools

The second job is a good idea
Do you have a pare room to let out?

Those two ideas could bring in £500 a month income

To answer all questions: matched betting is not in any way gambling. It's a straightforward way to make additional income.

I'm not going to put all of my income and outgoings on here!

A second job isn't possible unfortunately, we both work very long hours as it is. There is no spare room.

Thank you for the advice flowerofscotland, it is very much appreciated. I'm planning to phone each of our creditors, will they prefer letters?

The 'papering over the cracks' bit is simply to get us through the next few weeks. If we can generate just a small amount of extra income then we can avoid missing any further payments, which needs to be our priority I think.

Twickerhun, that's a very good point. Thank you. There are a couple of things up for renewal actually, and a contract that is coming to an end which is worth £60 per month. We've cancelled as many non-essentials as possible.

Having said that above about no time for a second job, I may be able to do some work from home linked to the field I'm in...I'm looking into it.

We've done the stepchange thing, it was them who suggested the IVA, which I'm really trying to avoid at the moment.

Thanks for all the suggestions.

I would also suggest joining the no spend thread & the frugal thread

Find many cheap eats, ditch the meat and alcohol- your supermarket shop will reduce

I recently helped a family member with this. She phoned all of her creditors and they helped her immediately. Although she was asking for reduced payments for a shorter period of time. CAB said that creditors are usually fairly amenable as they want the money and would rather this that you not be able to pay at all.

When you call write down every detail - names, times, dates and what was agreed. My family member fell foul of a couple of companies. Capital One said they would help and cancel payments for a couple of months - however they then made late payment charges each month (for which we are now complaining about as she was told this wouldn't happen) and then the next month they took a normal payment (which was later refunded). So pin down everything and make sure of exactly what will/won't happen. Vodafone refused to help in any capacity as they said if she couldn't afford to pay one month then they couldn't see how she'd afford the higher payment the following month (cash flow was how but they wouldn't listen). So make a list of all points to cover and give a robust case of how you intend to pay them back and how this will help you and how it will help them.