What is the best way to approach 30k debt?

[DebtFreeOneDay]

I'm in serious debt and only just managing to make monthly minimum payments. I need to sort this out.

I've had a really honest look at my finances and the reasons I have got in to this debt, and am taking steps to address the root causes. However, I am confused about how I should approach trying to clear these debts and could massively use some advice if anyone would be so kind?

I have £21,500 across two credit cards and £10,000 on store cards.
Minimum payments rack up to £1100 cpm. These are 'my' debts, although I am married and we share a mortgage.

I work full time and earn 1700pcm. DH is self employed and has fluctuating earnings. We have been turned down for a 25k loan against our mortgage because of DH's self employed status (stupid, really, as we have never missed a mortgage payment and have huge equity in our home).

I am confused about whether I should be looking at debt consolidation loans, approaching those I owe about a payment plan, StepChange etc? Whats the most sensible way forward?

I really want to face up to this and tackle it. Thanks in advance for any pearls of wisdom.

Just a couple more ideas appreciate you work full time but is there a weekend job you could do a few hours on a saturday could make you a bit of extra money. Do you have a large asset like a car that you can sell amd buy and buy cheaper one that still gets you about? Could make a couple of grand this way to knock off the store card debt.

You need to work on improving your credit rating so you can switch the credit card debt to 0% so make sure you're super organised about what payment is due when and set up direct debits so you can't be late. It will take some time to improve your rating but once it's looking better it will give you more options. Even one late payment can have more of an effect than you expect. I suspect this is a factor in you being turned down for a mortgage too.

And well done for cutting up the credit cards! I paid mine off and then stupidly racked up 2k in six months, so cut it up a few months ago and now I can't use it anymore I feel liberated!

Set up standing orders on all your payments putting the most money towards the highest % store card first.
If you put DD the companies will take the minimum so never paying off what you owe.
Look up Dave Ramsey and snow balling.
Ask do there's a debt free thread here or on credit crunch where talkinpeace is a wizz to help.
Check mad and soft search for low interest credit cards to see if your accepted.
If you've support from dh you can do this in a few years without dmo

Mse not mad

Try phoning Cristians against poverty.
You do not have to be religious.

They help a lot of people by going through exactly what you owe, they contact the people you owe & sort out manageable payment plans.
Good luck!

Definitely pay your cards by STANDING ORDER

This reduces your balance much quicker than DD ever will

Not sure about the math but someone will be along to explain soon

The reason to pay by standing order is that you pay a set sum every month - in the first month that might be set at the minimum payment, but in subsequent months it will be above the minimum payment. If you only make the minimum payment, you only pay a tiny % of whatever your debt is each month. You pay less and less each (in actual £) month and, because it's only a % it never gets paid off.

Take a look at the debt wizard website-really useful source of info

Also there's an old thread on here with a spreadsheet which you can put your debts into along with the rate of interest-you'll then see how much you pay if you were to set up a standing order-will try to link!

Also it could be worth ringing the card companies and just being honest with them; explain you're having difficulty paying and see if they'd be willing to cut the interest rate for example

Well done for taking the bull by the horns and recognising that you can't afford your lifestyle. While you're looking at paying off your most expensive debt first you need to look at where your money has been trickling away. Prepare to be shocked!

There's no getting away from the fact that it is hard to change a lifetime of overspending. I'm very lucky to have DH who is very level headed about money. It was damned hard to change lifelong habits but ultimately worth it.

You don't 'need' to go abroad on holiday. You can't afford to cheer yourself up with new clothes or make up. You can't afford to buy coffee out at £2 a pop. You can't afford to eat out or have takeaways more than once in a blue moon.

We made lots of changes when I became a SAHM which we have since stuck with because they weren't actually hard when you get into your new habits.

No gym - go for a walk or run. Potential £50 per month saving. No Sky - get Freeview save £25-30 a month.

You can feed 6 people very well on £50 worth of ingredients if you invite them for dinner. It'd cost almost that for one person in a restaurant. Plus you then get invited back.

Take a sandwich from home for lunch rather than buying out. Home made coffee in a Starbucks travel mug alone saves £40 a month. When I (rarely) buy the meal deal for lunch it's £3. That's £45 a month saved by making my own.

When the DC were little we had lots of holidays but camped so it was very cheap. However that's not for everyone but there are MUCH cheaper alternatives to the week-in-sun holidays.

There are lots of free or very cheap options for days out with DC and you can take your own lunch. At least you know they'll actually eat it!

Now I'm working again we have extra money that has built up a nice nest egg for the DC. Psychologically if we slipped back into old habits we'd be taking money from them.

Just think OP, once your debts are gone you'll have a lot of spare cash to save for something important.

I did have paragraphs above!!