£46,000 in debt

[Debtfairy]

This is the first time I've written that figure down. I've NC'd as this could be identifying.

We have 3 loans, 3 credit cards and a HP agreement for a sofa. Everything is being managed and we have a mortgage and want to move, so we need to tackle this and get it all paid off quicker than its currently happening. Debt relief order not required so no charities can help.

Basically we have NO idea where the money goes, we only have one salary and maternity allowance coming in due to mat leave with DC1, we shop in Aldi (max £35 a week inc nappies etc)

We have 2 small and economical cars
We don't eat out or go on holiday
We don't go to the pub
We rarely go and spend money
We don't have anything left!

Where does our money go?!

Any tips welcome!

Honestly I would approach the debt charity and see if they can help renegotiate freezing the interest etc. It' certainly worth trying, or they may even be able to reduce it.

Perhaps don't sell the 2nd car but declare it off road for a while and accept you can't afford to go out and about doing things - that would save a fair bit on insurance, tax, fuel.

MoreProsecco I said for future posters reading this. It's is extremely rare to be charged parking in NICU, what is common is parents never being told parking permits are available.

we had around 26k in debt minium payments got too much we had to fet an iva

it is worth considereing if yore not coping but they will insist u sell on of your cars

u dont need stuff on hp like sofas etc -wedding can cost a few hundred or dont do it

anyway they negotitate with the cc's and u pay a set amount and dont get hassled again

u wont be able to move for 6 years but thats just one of those things

OP, is there really no way you can sell one car? Could you drop your DH at work on the days you want to visit friends/family? Can they visit you some times? It does seem like an unnecessary luxury to have 2 cars when you can't afford them, just so you can visit friends/family whenever you want. It'd just need a bit of planning.
All of this assumes the distance to DH's work is practical for dropping off and picking up.
But surely a bit of inconvenience 2 or 3 times a week is worth the reduction in your debts?

Thank you all, our hospital had no passes or even weekly/monthly discounted tickets. So it was full whack everyday (the robbing bastards).

We will not do anything that will affect our credit reports such as DRO or IVA etc.

I've spent the evening looking into what businesses I could do from home to help out some

Moneysaving expert has some really good forums on - with lots of advice

Businesses from home are a hard starter. Since you have a car, can you not find evening/weekend work around your h's shifts? You don't get in gear, you may have no choice but an IVA. All it will take is a change in interest rates or a having to move to another interest rate when a term is up to tip you over the balance. You can't get a DRO anyhow as your debts are too high.

You'd be better off researching on MSE and the links people provided here than pie-in-the-sky work from home schemes.

Can you pay off that most expensive APR loan early? If so I would look at getting another 0% credit card and get rid of it asap.

I also agree with no point looking backwards what's done is done.

My advice is -

Can you move the higher loans to a 0% credit card by doing a money transfer to your bank? Have a look at the MBNA card which allows money transfers.

Overpay the debt with the most interest first.

Get yourself on money saving expert forum - the people on debt free wannabee are amazing!

Sign up to do surveys from home - onepoll, swagbucks, etc

Sell sell sell on eBay!

Switch utilities to cheaper providers.

Any chance you can switch bank accounts / open new bank accounts? You can get £100 every time you do this, plus if you apply online and go through Quidco for cash back.

Shop at ALDI.

Buy own brand food.

Bulk out meals with veg and less meat to stretch meals further.

Eat less meat.

Keep a spending diary.

I am trying to pay back £17,000 worth of debt due to failed IVF. We can do it together and keep each other company if you like

Honestly, the second car and fibre optic broadband are beyond your means and should go. You say the car is worth £1500 so sell it, put 1k towards your debts and keep the rest for taxis for the rest of mat leave.

I had a premmie and went back when she was 4 months corrected. It was incredibly tough but i was the main breadwinner and had been offered a promotion on mat leave so needed to go back.

It is very easy to think you are spending £35 a week in Aldi and to find, on closer scrutiny, that you actually spending double or triple that with top up shops/take always etc.

Log every spend in a small notebook and then review it every week. It may be more cost effective to spend a bit more on your weekly shop.

I paid off £35k of debt. I got nowhere until I truly realised the situation. From this light bulb moment, it took just under 5 years to get free of it. Until that point, my half hearted efforts had little or no effect and most years my debt burden just crept upwards. From your OP, I just don't think you have had that lightbulb moment yet. So most of our suggestions will inevitably be met with excuses and rationalisations. I don't mean this in a horrid way; it's just how things are.

debtfairy I just want to say you have made the first important step towards sorting this out which is admitting the problem and working towards sorting it.

As others have said there is little point in looking back and wishing away the decisions that got you in this mess away. The only point to this is to learn what not to do in future.

I echo what many people have recommended and suggest you head over to the MSE debt free forums for some very constructive advice.

u might think your crdit report isnt damaged but it could well do if u dont keep on top of it which is hard

and they wont automatically give e a mortgage for a new house just because youve kept up cc payments they take into account how long it took u other outgoings etc

As nanny nick said upthread - Dave Ramsey is a brilliant starting point. You could start listening to the podcasts for free. The book Total Money Makeover is such a winner.

We've gone from £46k (yes really) to now 13.5k in 3 years.

We sold 2 cars and I took on loads more work (more than full time)

We have an aupair - not relevant in your situation i know.

Loads of stuff to sacrifice just to get it DOWN

Good luck, congratulations on your baby.

You can download microsoft money support.microsoft.com/en-us/help/2118008/what-is-microsoft-money-plus-sunset Then you can use it to keep track of all your spending. Balance your accounts. It can summarise very quickly where your money is going and will show you what you should be paying first. Can you move some of your credit cards to 0% interest ones. That is a lot of debt :(

Agree on the fibre-optic broadband.

We haven't got it as it didn't reach our village. Now it does reach our village, we can't be arsed to upgrade. For normal usage (we can still cheerfully use iplayer, youtube, all have internet at once etc) we can't see the point.

Plus we are cheapskates who are now debtfree, dreaming of mortgage free and early retirement.

First of all- well done on getting through NICU in one piece. Unlike others posters I'm not going to tell you to get back to work. Having had twins at 27 weeks I feel your pain. There is no way I would be leaving my baby at 12 weeks corrected age- apart from anything else mine were still only 4 pounds at this age. Given the work that goes into getting a prem baby exclusively feeding I wouldn't be suggesting switching to bottles just yet. You probably have a succession of appointments to keep so I can see why you may need a car but is it worth being taxi for your DH at least while your on mat leave? That way you have freedom during day and only have cost of running one car.

As soon as you start a job your mat will leave will end so its worth considering if its actually financially worth it.

You need to negotiate rates with lenders ASAP- consolidating is possible. Move as much as possible to a interest free credit card.
Sell as much as you can- eBay/Facebook will give you higher return than car boot IME.

If it helps we negotiated our mortgage when I was on mat leave. My employer/HR needed to supply a letter with my intended date of return to work and my salary. I then had to provide the last 3 payslips before i went on mat leave (there is a vague clause in the equalities act about no discriminating against women on maternity leave if I remember rightly). This may or may not be relevant to loan consolidation.

Keep going- when things look bleak think about your darkest hours in NICU and it won't seem that bad.

I think you really need to monitor your spending, write down everything you spend to the penny. From your post where you listed your debts, it seems there are big gaps where you can't really account for where the money went - that indicates that you have been generally spending a lot more than you have available.

As well as all of the ideas already given here for earning extra income, try matched betting. There's a sub section on the MSE forums about it and I think there's a long running thread on here about it too.

I disagree on dumping fibre. There may not be an active BT line any longer, so are already saving having line rental. The fibre agreement may still be in minimum term period, so a early disconnection charge may apply if ended early. I would keep it until the minimum term is approaching end and then look at what viable alternatives there might be. When calculating costs take in account of Install/Activation charges the monthly cost, plus any disconnection/termination cost.

the reasons you got into debt are important for facing up to the problem - and you've obviously been spending over your income for some time. So it's going to be very very tough to pay your debts down. Start by getting everything you can onto 0% credit cards www.moneysavingexpert.com/credit-cards/best-0-credit-cards
( Iknow you have some already) and/or consolidate debts into one loan. Would your parents/ other relatives lend you money to pay off your most expensive debts?

You cant afford 2 cars. Could he get to work by bicycle or moped as these are cheaper to run? If not can you drive him to work or is it too far to be economic? Are you taking short showers instead of baths? Can you switch your broadband? Have you considered giffgaff for phones - no contract and calls to each other would be free if topped up every 3 months. Their cheapest goodybag is £5, might be better than PAYG.

Unless you want to live in poverty for ages you need to find some work. Can you babysit/ garden/ iron? You can possible take the baby with you to some jobs, a friend took her child when she did a cleaning job. You might be able to find care work where you could take your child and that would at least make the car an asset.

I would always keep broadband. It can be essential for finding work and ways to save money.

I do agree (frustrating for you I'm sure!) that a second car is a luxury. We don't currently have any debts but can only afford to run one car. Luckily husband doesn't use it for work now, but when he did we compromised so sometimes he trained it in and I had it when I had to go somewhere difficult to get to. Otherwise I walked more!

I've decided to budget more carefully this year as I was constantly going into my overdraft. Now I have an estimate of what I might spend each month and the actual record, including anything I spent at all from parking to sweets with loose change to groceries and clothes. It's like food and myfitnesspal, it keeps you from justifying treats if you have to write it all down.

Do you have any freelance skills? I wouldn't necessarily recommend PeoplePerHour any more (commission has gone up to 20%!) but it can be useful to see what skills you may have that you can sell. Eg if you could write you could contact local firms for copywriting/blogging/email writing etc. It can be hard to break into, but it's all about who you know and one good contact/gig can turn into lots more.

You can do little bits of work for pocket money - MSE has all of this on its forums, Swagbucks (surveys and videos, I get the odd fiver here and there), Qmee (money just for clicking links that pop up occasionally when you google, I get a pound or so a few times a year), Quidco - everytime I buy online I see if I can get cashback on Quidco first. Just don't let it trick you into spending when you otherwise wouldn't. Only use it for stuff you were buying anyway. All these things pay me in Amazon vouchers or Paypal that I use for treats or presents for kids etc.

Whatever you do, don't do a MLM like Forever Living or Younique. You will lose friends and money.

You might be able to claim DLA for your premature dd. DS was born 13 weeks early and was NG fed and got DLA awarded since he was 6 months. It increased our tax credits award too (not sure if you'd be able to claim as you might still be over the threshold) and allowed me to claim carer's allowance. All in all about £200pw extra so well worth doing.

You can also look at survey sites for upping your income - it won't be loads but I get about £30 a week in vouchers from various sites which I can spend on Amazon for groceries or nappies. Have a look at the MSE Boost your income board - lots of ideas.

The problem with the second car is the upkeep. Add up insurance, servicing, MOT, and road tax.

Any way you can drop and collect DH at work, or a station or a bus stop? Or that he could use a motorbike or scooter to get to work?

Sorry if I have missed it, but what is your household income (including child benefit) with you not working?