Debt Number 3 : For those who feel they are drowning and want a way out

[TalkinPeace]

This thread follows on from Nerf's incredibly useful
FIRST www.mumsnet.com/Talk/legal_money_matters/1969188-Can-we-have-a-support-thread-for-people-who-are-massively-in-debt
and then
SECOND
www.mumsnet.com/Talk/legal_money_matters/2011878-Debt-support-thread-2?
threads about realising you are in and supporting each other out of debt.

I am not in debt, any more.
Here is a link to some spreadsheets that might help
www.mumsnet.com/Talk/legal_money_matters/1987219-SPREADSHEETS-for-Debt-Control-Budgeting-Mortgages-etc

and lots of people use this
YouNeedABudget

The important thing to remember is

• yesterday is as past as the Crimean War

( we will not judge how you got into debt, but we will support you on the way out )

• this is an anonymous forum

( we will not tell your employer, family or friends of the reality of your numbers )

• this thread is about supporting people through the huge mindset changes needed to come out of debt

( feel free to offload all of the feelings that drive you to want to spend, that make it hard to save and that generally make life crap at times )

Join in, bare your soul and come out the other end.
Its worth it.
You are worth it.

also linked in the OP

Thanks TiP. So just a spreadsheet adding everything up, separate columns for separate outgoings, e.g fuel, food parking etc?

I tried to download the spreadsheet in the OP, but couldn't open it on my pc. I do have a spreadsheet for income and outgoings and can set up another for the individual envelopes.

Thanks for the help and tips, I'm determined to get to grips with this and taking control and doing something about it helps prevent me panicking.

Hi Kazza,
the budget sheet should be working now ....
in google docs, click file and then download as and it should let you have your own copy to play with

Thanks antimatter. October was the original plan but I am so busy by then at school I am thinking July is better. The one I found was all inclusive in Majorca with free access to one of the Alculdia water parks all week (next to hotel) for £1400 total and no need to shop for food or cook or pay to eat out. On site entertainment in the evenings too. My big teenagers eat non stop so all inclusive is essential! Plus I know Alcudia and it's great for teens. Just need to check proximity to the amazing Alcudia beach.

Right, tiny pay rise and tax changes this month - is it sad that I am waiting up until midnight to see what my actual pay amount is when it hits my account so I can finalise my YNAB budget for May?

So - we have decided to ditch the paid for account (our joint account which he got before meeting me). It's £13 PCM and includes breakdown, insurance for phones, travel insurance etc. but since we're getting out of debt it has no place!

We're also receiving a cash back Amex card for fuel and food. This will be paid in full every month and reward us for what we'd buy anyway.

We have discussed spending "habits" and not to view the Amex as a new line of credit, but just a different card that still is budgeted for on our spreadsheet.

Hello Freckled. I was bailed out loads of times by my grandparents, money sloshed all over the place but I wasn't clued up enough to realise I wasn't earning the same!
I use Excel at the moment and followed some advice on here about seeing where it all went - we should have 800 spare but never did. Now I know why!
Two NSDs in a row. Can't believe how fab it feels at the end of the day!

Thanks TiP, I'll have a play next time I'm on the pc.

ishe my pay rise was offset by the rise in pension contribution and I came out £8 worse off. Great.

kinky me too!!! I am £40 worse off

In other news, DH got both freelance pay for this month and ALL his back pay, and his regular wage, enabling us to do a debt update:

C1: £4692 £4595 £4532

CC2: £3781 £3675 £3659

Car hire purchase: £3764 £3108

DH Old Student Overdraft: £1940 £500

CC3: £1692 £0 GONE

CC4: £1405.49 £0 GONE

Total: 17,274.95 £13,944.54 £13, 282 £11, 799

Pressed post too soon!

After buying the new dishwasher I won't have any kind of surplus on my salary at the end of this month, so it'll be May 25 (my next payday) before the numbers move again, when we should be able to close that old student account completely and begin attacking the big credit cards.

freckled kazza I have a savings account linked to my current account. I have a SO to go into it every month and it's there that I save for annual 'big' payouts - insurance, Christmas, holiday, replacements etc. I then update a spreadsheet each month to see how much is saved in each 'pot'. the money in my current account is also separated (via another spreadsheet) into its different pots. I would imagine that this is very similar to what a lot of people on here do. I'm sure it would be just as easy to do without the additional savings account and simply use the current account, but for me it works to physically move some money to another account otherwise you wouldn't believe what I could explain away under 'holiday money'

sorry, there should be a comma between freckled and kazza. I think I've just merged you two people together!

Hi there and thanks for this great thread.

My situation is I have not worked in 8 years and have been at home with the kids. Am currently desperately looking for work but am not getting any interviews .

My DP has debts which are currently amounting to:
£8k loan being paid off at £177 a week (48 wks remaining!!)
£12k loan being paid off at £350 a week (50 weeks remaining!!)
and a £500 overdraft

My debts are:

£3000 on a cc
£2000 on an overdraft.

My DP earns just enough to make his monthly payments (his recently arranged £12k loan paid off a £10k credit card and 2 x £500 credit cards) We have to scrimp to make these payments and have no extras for clothing, emergencies, holidays, treats, extra curricular activities for kids etc. That's why I need to get a job!

Leaving aside my DP's debts I wondered what would be best to do for mine? My credit rating is screwed because I have already had an IVA 5 years ago. I use my child benefit to pay off the minimum payment every month on my cc and the £30 monthly service charge on my overdraft.

Should I contact the cc company? Is it easy to get the interest frozen? Would I be better off approaching an independent debt management organisation rather than the cc company itself?

We don't own our own property and have no savings (obviously!)

What a state, I really do need to get a job

Hi getanotherloan
I don't know if it would help but when I met my dh and he had loads of debt we contacted the Consumer Credit Counselling Service and they sorted everything for us based on our income and what we could afford. It will take us years to pay it back but the interest is frozen and no-one hassles us. All the negotiating is done by the CCCS.
Maybe you could try contacting them?

Hello LookRightNow, and welcome back! Well done on sorting out your plan AND getting DH onboard too that latter can be a challenge in itself!
IsHeSingle holiday! Youve worked for it; youve paid for it enjoy it!
Jemster welcome, glad you found us! Envelopes for me work as follows I have worked out all my annual costs (MOT/car insurance/etc) and worked out what they equate to on a monthly basis. I then put the monthly amount aside in one online account and track via a great wee app Ive found (called Envelopes funnily enough lol). I do same for food and petrol budget.
Kazzawazzawoo well done on getting your budgeting started!
FreckledLeopeard welcome to you too! Once Id done my budget and knew what I needed in each category I tracked in just using a paper/pencil before advancing to my Envelopes app. Note down everything! Youll soon see where your money is disappearing too it was a long boring night but I went back over 12 months worth of statements to get my budget started. Was truly shocked at what Id wasted more so over the cash withdrawals that I just could not explain or think where the money had gone!
Antimatter welcome!
GetAnotheLoan welcome! Rather than looking to freeze interest, can you freeze your repayment and not reduce it as the balance reduces? Have a look at TiPs spreadsheets linked at the start of this thread and see what a difference it can make in terms of the term of the debt!
MoneyOne and MissAnnersleyismyhero well done on your repayments this month!

getanother

Firstly, welcome!

Secondly - you guys are doing awesome already! If you keep up the payments on those loans you'll be debt-free in a year! That is great.

Could DP get a second job/deliver pizzas/weekend work? My DH has taken on extra work and I have signed up for some which is seasonal (summer) and honestly this is the single thing that has helped lift us out of debt. Those extra payments are transferred straight off the debt and make it come down.
Sell stuff on ebay, facebook, gumtree - every little helps! I sold lots on eBay for only about £3-4 but it added up to a total of £427 over 6 weeks.

For yourself, keep looking for a job and don't be disheartened, what have you been doing so far? If you haven't been actually walking around dropping in CVs that is a really good way to go, you can see signs up in windows etc which might not be advertised online or in a paper.

I wouldn't go down the debt management plan route unless you have no other option, but if you can get your income up and start hitting the debts hard, living really frugally you could wipe them out quite quickly, then use your income to make life more comfortable while DP slowly chips away at the other loans.

I know it seems insurmountable now, but you can do this! We're all here to cheer you on.

Oops I made a mistake there are 48 MONTHS and 50 MONTHS (not weeks) left on both my DP's loans. So 4 more years not 1 year unfortunately MrsAnnersley!

My poor DP works hard enough as it is and also has health issues so further work for him is not an option.

I just need to get a job and would dearly love to earn enough to pay off his loan payments every month and a chunk of my credit card/overdraft debt. That would mean a job with a take-home of at least £800 per month. Be great to work a 20 hour week and clear £200 a week but am probably only going to get the minimum hourly rate of £6.50-ish. Still ANYTHING would be better than nothing.

Thank you for these tips! I've started using the Google Docs spreadsheet and it's very interesting. I can see that a lot of things I spend on, I have just never budgeted for (building work, car maintenance and servicing, holidays).

I am going to Asda now and buying ONLY cat food, cat litter and tights (hopefully under £20 - I need to bulk buy cat food).

I've cancelled my yoga membership (sob) but can't justify spending £70 per month on it

kinkydorito
A lady I work with cannot have a pay rise - because her salary is £35 below a massive jump in pension contributions and then the 40% band.
To leave her better off net we'd have to give her a 13% pay rise !!!

getanotherloan
have you got all the repayment sset so that they do not reduce each month - it makes a HUGE difference to some loans.

freckled
join the group "yoga inspiration" on Facebook and check out some of the flow videos that you can do at home .... £70 a month is a LOT : I pay less than that for a whole gym membership including classes and pool!

silkknickers, thanks for the tip, that's probably what I'll do. I'll set up the spreadsheet accordingly.

kazza, you're welcome! You'll probably find you have to tinker with it for a couple of months, until you find what suits you best.

Kinky and MissA - same here, I ended up £8 worse off too

But we don't deserve it anyway, us lazy teachers with short hours and all those holidays.... (I say, as I sit marking GCSE coursework at 2am having worked non stop since I got home at 6pm, knowing I spent 5 days of the Easter holiday at school and have a bloody parents evening tomorrow....)

Must be easier ways to earn a living