A thread for people trying to pay off debt?

[moneyworries8]

Would there be any interest in this?

I'll start us off. I'm 30, a SAHM with 2DC.
Our debts are:

£4,000 loan that we've been paying off for 6 months.
£2,300 on a credit card

The debt is manageable but I've had the realisation that if something doesn't change, these figures are going to get bigger and bigger. I know it's a hard time of year to start but I don't believe in "waiting until the new year!"

We could post on here for advice/support as well as sharing our successes (and failures, but hopefully there won't be many of those) with each other. I feel like I need some people to help keep me on track.

So, is anyone interested?

Well we've had our loan rejected. It's a horrible feeling and sad that it really would have helped massively as the repayment amount would have been equal to credit card payments but this would have cleared the overdrafts too.

We didn't really know what to do next. It's not a massive issue but we just wanted to proactively sort out the debt (I can't remember when we didn't live in the overdraft).

Anyway, after sitting down and talking clearly we've realised we should have nearly £1000 a month left over after bills and food shopping. Where has this been going?!?

I think this amount is a relatively new thing and looking back, I've moved money between accounts and we've had a bit of a splurge (also the car needed some work doing).

The new plan is to transfer just under this amount per month to the 'spare' account and use this for additional spending (which we hope to curb). It'll be easier to see what's available as it'll be away from the regular bills and should make us think twice before buying anything (meals out our downfall). Once we've got enough to replace the higher overdraft, we will transfer it back just before payday and then we will finally be in credit! This will continue until both overdrafts are sorted and then we will tackle the credit cards.

We can do this!!!!

Good plan lifebegins. Maybe not getting the loan was actually a good thing as it has made you reevaluate your finances and come up with an alternative plan which doesn’t involve another lending source.

I’ll join.
£7500 credit card.
£7500 loan.
£2500 overdraft
So we’re in a lot of debt.

Any tips for staying within budget over Christmas?

Placemarking.

We're about 10k in debt I think, will add it up later and see where we are.

To the poster who said about getting a car loan over the summer. We did this, got a loan to get an almost new car and consolidate some debts at the same time. It turned out to be a bad decision. if we had just got a decent second hand car for a couple of thousand pounds then all that extra money that we wouldn't have been paying on the loan could have gone towards the credit card debt and we would probably be debt free by now. Think really carefully about how much you actually need to spend on a new car and how much of a difference that payment would make to your debts. In my view it doesn't really matter if it's a necessary debt or not, it's still adding to your overall debt pile and taking money away that you could be using to reduce your other debts. I wish we thought harder about buying the car that we got.

@RedDeadRoach I hear ya! I am paying a big car loan and repairs loan on top. I'm much wiser now. Some of it was bad luck that no one could have foreseen but I am honestly thinking of never Having a car loan again, saving and just buying what I can afford out right. I've 2 kids and a short commute. Once the youngest is out of the buggy/bulky car seat stage a small cheap car it is for me

Keely71 I do recommend the fudget app...I've my Xmas pay dates and predictable expenses in it and can see how it will pan out and everything is just about covered. Gives a feeling of control and that helps a lot

Thanks Chrissmasjammies I didn’t think to look at an app. I have a little notebook where I jot down all the ‘big’ ins & outs, but it’s all the little things that add up & where I lose control.

To the poster who said about getting a car loan over the summer. We did this, got a loan to get an almost new car and consolidate some debts at the same time. It turned out to be a bad decision

I have thought about it quite a lot. We pay £230 a month for our car lease and every few years we're paying around £1800 as a initial payment on our new lease. Buying a decent, 2 year old(ish)second hand car and paying off over maybe 4 years at around £260 a month will work out better for us than what we are currently doing. At least we'll own it at the end. DH has also had a recent pay rise and will get another in a years time so I feel this is a commitment we'll be able to undertake. We need a reliable car as we have 2 small children and travel the length of the UK fairly regularly with the kids in tow. We are both going to be moving onto sim only phone contracts in the next few months which will also save us around £60 per month. We have also just finished repaying a family member for something which frees up another £30 per month. I think if we're smart about things, we can make the car work.

I've been using fudget for a couple of days and it's actually really helpful. I can see exactly how much I've got left for the month because I've already added in all my fixed bills etc. I can also add all my spending in supermarkets so I can see if I am in line with my weekly budget. Previously I have tracked my supermarket spending by looking at my bank statements but obviously that doesn't split out what I have spent on food and if I have picked up some clothes for the kids or something like that. I always keep my receipts so when I got home from the shop last night I put the groceries into fudget and put the Christmas presents in separately. It has made it easier to track what I'm spending on Christmas presents and I am reassured that hopefully even though it's December and I have lots of birthdays as well as Christmas to consider that I will hopefully end of month with money left over which I can then put towards the credit cards. It's taking me a very long time to gradually get all this in order but then again I started off knowing absolutely nothing about financial matters at all so it will take time to learn what I need to know.

I think the key for me is getting all these tools together and then using them - ie switching utilities, apps, monthly budgets, keeping re receipts, selling unwanted stuff... all that stuff. The biggest thing is willpower. Our Christmas tree is really old and thin. I very very nearly went and bought a new one and some new lights but stopped myself at the last minute. Now our tree is dressed it looks fine and I feel like I am £100 better off because I didn't waste it on a new tree.

I think it's also important to not beat yourself up about the fact that you're in debt. That will take valuable energy away from actually dealing with it. Of course look at the reasons why you're in debt and try and address those but good or bad there will be reasons why you got into debt so put your energy into dealing with those, not beating yourself up about the debt itself. It's easy to fall into the trap of telling yourself you're stupid for getting into debt and if you buy something you don't completely need, feeling guilty about it.

We got into debt through a combination of reasons, some justified, some not.
But the overwhelming reason was we just didn’t have enough money to meet essential bills, so took out credit cards & overdrafts to help. I remember once reading if you have to buy food with your credit card you’re in trouble. And stupidly, because I felt down about our situation, I’d buy things on the credit card to cheer me up, nothing really expensive, just silly things like a nice bunch of flowers.
We’re in a much better position than we were 5 years ago, debt is still large but manageable now. We owed about 45k at one point and have worked hard to pay it off without needing a debt management plan or any other intervention.
It’s so depressing & exhausting being in debt, and although we’re almost there, any setback ( reduced hours at work / illness etc ) would put us straight back in serious trouble.
Our aim now is to save save save! so if the unexpected happens we have our own money to fall back on.

@Keely71 you have made huge progress then . In another year or two if you keep going it really will start to feel like the end is in sight

I think going forward credit cards and over drafts just have to be not an option just no way. I see them now as borrowing from my future salary and disposable income. We will all get there for sure one day/week/month at a time and then it's measures to make sure it can't happen again. It sounds like you have made great strides Red. One thing I tend to leave out or forget is bills that crop up once a year, car ins house ins and oil refill. I added them up and averaged them over the year and did include some non essential spending like Xmas and birthdays. It came to about 300 a month so once my debt is paid I'm looking to build that into every months budget and if I can't save much or anything for the month beyond that then so be it.

Keely we too have done the same, I have a spreadsheet and we currently owe just under £25k. Never miss a payment and everything is set at above the min - the way we are going at the moment we will be fully debt free within 4.5 years. It is a huge amount compared to our income, and really snuck up on us as its in 4 different places - but we are getting there and every month it reduces by £490.

£8000 loan and £4000 on credit card never written it down like that before, seems so much more written down! paying both off slowly 😣

Don't worry par05 we are all in a similar boat and are here to support & motivate each other to succeed in being debt free!

I have tried to get a handle on things before and failed, that's why I've started the thread. Support from others in the same position will hopefully really help keep us all on the right track.

lifebegins
you missed out on a consolidation loan
YAY ..... RESULT ..... Excellent
They are nasty smelly things
You are far better hitting the credit card debt with the credit card trick

Cars .....
Year before last I had to buy three cars within the space of a year
eye watering amounts of money.
BUT
Two of them were bought for cash ....
one was ten years old and will last another five years
another was six years old and will last for ten years
the third was eye wateringly expensive. I was half cash, half a 5 year zopa loan .... which I paid off in a year .... and will last another 4 years

Cars are tools.
Better to buy a 4 year old good quality one
that is already largely depreciated

eg my car is worth more than it cost me two years ago none of ours are diesesls
than a modern box where the first ten payments are just value loss

3000 on credit card just paid of 500

par05
Is the card on a standing order?

Paddington
well done

May I join please? We're in more debt than I want to admit, but not admitting it to myself is making me feel more stressed and depressed.

Various reasons I suppose - DH and I can't seem to agree or stick to a budget. DH lost his business and is in a lower paying job now. I had to leave my job due to anxiety; I have a new job to begin next year but again, not well paid. We used credit cards to pay for essentials, plus treats when we were feeling down. Unexpected car repairs, school books, etc, etc, .... it's just crept up and up.
We have our house on the market as we struggle to pay the mortgage, but the house market here (Aus) is dead and prices have dropped, so we would most probably end up selling at a loss anyway. No offers as yet.

So, we have 2 credit cards which are at their limit of $500 each.
We owe both sets of parents about $1000 each (very embarrassing to admit).
We're paying off the house rates in installments.

Oh, and the car air conditioning stopped working yesterday (it's summer here) and can't afford to fix it.

I haven't bought the DC anything for Christmas and feel guilty that we can't afford to. We're supposed to be hosting the families this year, but I think we're going to have to admit we can't afford that either. It's just so humiliating.

I really need to get us back on track, get a budget sorted and stick to it!

Have created a spreadsheet allowing for £70 a week on groceries etc, bills paid and 'personal' spends of £60 each a week (including fuel) throwing any spare cash at our £25k debt, spreadsheet says that this time next year we will have paid off £10.5k!

Having it all written like that looks amazing, and knocks years off the 4.5 it's taking now. Here's to sticking to the budget.

Hi all can I join as i think i need some help to keep on track as feeling very down at the moment.

I have a large amount of debt - over £20k - i was managing to pay some of it off with matched betting but in the last couple of months I have had to reduce my hours at work as I have been diagnosed with an auto immune condition which means I am exhausted all the time so cant work my normal hours.

That and a couple of things i have had to spend money means I am back to over £20k and cant concentrate to do the matched betting properly.

Anyway hopefully we can all encourage each other - I have bought most of my xmas presents so just trying not to spend much else this December

carols
Welcome to the gang ...
We used credit cards to pay for essentials, plus treats when we were feeling down.
What did you do to earn the "treat"
You need to cut all spending back to bare essentials while you are in critical debt.
Have you sold any and all tat out of your house (ebay, facebook etc)
Have you done an up to date budget ?

petal
Matched betting is not the way to clear debt.
How much were you NET earning per week and per hour?
Your time and energy is better spent on a proper job.
Focus on clearing th edebt by sensible means.
Is the card on standing order?
Do you have a budget?
Have you stopped fripperies like coffees out?