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?

I see them now as borrowing from my future salary and disposable income

What an excellent way to think of it.

Talkin,

We will have to agree to disagree over the matched betting as i made over £10k in the last year but it does take concentration which I dont have at the moment.

I have done a budget and I am paying my credit cards on the standing order trick as i have been following your threads for quite a while but this is the first one I felt i needed to join as illness means i am drowning. All credit cards on 0% for now.

Very little flex in the budget but i will try to get some tips from everyone here and help if I can with anyone else

petal
How many hours a month did you spend online to earn that £10k
were you paying yourself over £10 an hour?

If you are ill it might be worth talking to Stepchange as they might be able to organise a DMP to take some pressure off you ....

Thanks Talkin i thought about doing the stepchange online debt remedy tool to see what they suggest but not sure - i have a large amount of equity in my house but no means to access it without selling the house.

Can you do a dmp if you have a mortgage etc?

Thanks

petal
I am not sure but there can be no harm in asking.

If you have lots of equity in the house, is it worth upping your mortgage by the £20k - so transferring the card debt at ~18% to mortgage debt at ~ 3%
and then concentrate on getting as healthy as you can

I'd like to join, I'm already on the no spend thread and I've got quite a lot of debt to clear as well as DH as we want to buy a house hopefully in about 22 months from now.

We pay DH's card via direct debit and they take a minimum payment each month. Do we switch over to paying this same amount via standing order ? Sorry I don't quite understand the standing order trick.

We are with llyods and Halifax and are hoping to clear our enormous overdraft by Feb/march as it's costing us an absolute fortune each week. It's all about the snowball effect this year if we can clear things up then use that money to clear more stuff too.

Hi there rosie
We pay DH's card via direct debit and they take a minimum payment each month. Do we switch over to paying this same amount via standing order ?
YES, definitely.
If they take the minimum by direct debit it will take you over 15 years to clear the bill.
If you change to a standing order at what you paid this month
that drops to 2 years

Gosh I wasn't aware you could do that ( switch from direct debit to standing order ) as all they seem to offer you is a direct debit arrangement.

Do we have to contact them to do this? Thanks for the info btw, sounds like a really good way forward if I can get it to work

I still don't understand this standing order trick. My brain has obviously turned to mush after having 2 kids

So we have a direct debit set up for the minimum payment. We pay this amount each month (around £30) and what we have left at the end of the month is then also paid off on the credit card. Our credit card is currently on 0%. Would this standing order trick benefit us in any way?

I don't understand the difference between standing order and direct debit? . I don't really get how it makes a difference. ( Maybe that's why I'm in a mess )
We currently only pay the minimum on the credit cards each month via direct debit. I looked at the bank's website and they only talk about paying via direct debit.

Not at the moment

If your Standing order is £70 and £35 is interest

The next month you pay £69 and half is the interest

So by changing it to a direct debit and always paying £70 you effectively pay an extra £1 off the first month and £2 the next until you are paying £69 of the debt and £1 in interest

Roughly guessing at figures! But there are proper calculators on line

ome changes monthly one is set price so to speak

My credit card allows me to set a direct debit to a set amount so I'm assuming that would just be the same as using the standing order trick but I'm thinking maybe not all cards allow you to set direct debits to set amounts?

Oh thank you for the explanation @GreenTulips.

Sorry @Talkinpeece, I didn't answer your questions -

What did you do to earn the "treat" : To be honest, nothing . If we'd had a bad week at work or something like that, we'd have a takeaway on Friday to cheer us up a bit. Sometimes I felt sort of immobilised by depression and anxiety and I'd say I just can't face making dinner.... that kind of thing. I know it's a stupid thing to do and I am determined to turn things around now.

You need to cut all spending back to bare essentials while you are in critical debt I know . I'm trying to formulate a budget we can stick to. We both deviated from the budget in the past, so I thought maybe each evening we have to account for ALL spending to each other. Sometimes DH would admit to buying coffee or two during the work day and I felt frustrated that those small amounts were adding up.

Have you sold any and all tat out of your house (ebay, facebook etc) - Yes, I've sold a lot of things recently. Still have some listing that haven't sold so will drop the price to get them sold.
Have you done an up to date budget ? - It's a work in progress.

Hi all, no up to date figure yet - but I love the idea of live WhatsApping your spe DS to a partner.

We're going to try that.

We are ninjas with spreadsheets and budgets, but it's never really made any difference. We still spend too much. We have been paying a set amount off the cc so hoping the total may have dropped a little.

We have finished paying off the car loan this year - car promptly needed 1.8k worth of repairs which went on a cc... we also had to buy a second car to fit in two commutes. We went for a small few hundred quid job which is doing fine.

I'm wondering if people are right about us dodging a bullet not having a consolidation loan. I guess it means masking the problem whereas now we've taken a proper look to remedy it.

So far, going strong. Got the weekend to get through without our usual meals out but we've planned a few things that need doing so should be ok.

I've got some people to buy Christmas presents for which isn't great but I'm keeping it on the frugal side. The Christmas food should be able to come from my monthly food budget.

With the shock of this situation, maybe it'll keep us on the straight and narrow!

I spoke to extended family today and said we're not doing presents this year.

I think our basic Christmas food should come from our general food budget if I pare things back.

I have no idea what I owe! I haven’t opened a letter since last xmas! I feel sick at the thought of it. Store cards, credit cards! I dread to think of the interest now! 😔 I can’t sleep because I’m panicking, I tell myself every night that tomorrow I’ll sit and open them all, then I just panic and ignore them again!

MUjunkie you don't need to do this alone. Open them. We are here. Tell us what the damage is and some people on here will have experience which may help you. At the very least we can offer support. As you're well aware, not opening the letters doesn't make the debt (or the stress) disappear!

Thank you! I just feel the panic rising every time I look at the pile of them! I’m terrified of bailiffs turning up or something! I know I’m making it worse burying my head in the sand. I’m going to get them all together and take them with me to work today! It should be a quiet afternoon and I will start opening them! Thank you for this thread it may just give me the kick up the arse I need!

Good luck MU. There is help out there.

@MUJunkie
You are NOT alone.
We are here for you.
Have a look at the links in the other thread
www.mumsnet.com/Talk/legal_money_matters/3439641-Drowning-in-debt-Dont-know-how-to-get-out-You-are-not-alone-Come-and-share-and-find-a-way-through

Open all of the card statements.
How much is the balance on each?
What is the interest rate on each ?
What is the minimum repayment on each?
Are you still using any of them?

Post it on here (or on the other thread)
Now start to take control.
Put each of the numbers into the spreadsheet
www.mumsnet.com/Talk/legal_money_matters/1987219-SPREADSHEETS-for-Debt-Control-Budgeting-Mortgages-etc
And see how the standing order trick will give you your life back

and breathe

Last time I looked (January when I pad my tax bill and got a credit score thing to work out how best to borrow the next amount), it was £48,000. I know. Our children required expensive treatment and then I had the joy of (very short nevertheless) self-employed maternity leave. I am the main earner by far. I really really want to clear it. Not least because I am now in my 40s and don't have a pension. Went from clearing student debt to having children. A mess. I work bloody hard but don't see any of the rewards really. I don't miss payments but it's hard. Still, my kids were worth every penny.

Catsize
So you invested in your children
they will get a lot more irritating as they get older
GOOD
So, how are you managing that debt to maximise the effectiveness of repayments
and minimise the bank's profits ?
cos that is when debt management gets satisfying

Thanks talkin. I'm paying a standing order for various cards, bank and car loans. I tend to live in my overdraft. Against the odds, I was approved for a 0% card to transfer a balance the other day. But I have nothing for this year's tax bill, which is a bit stressful. I've honoured very payment in my current arrangement with HMRC so living in hope that if a miracle doesn't materialise, something might be agreed again. My earnings dropped by a third this year, which hasn't helped matters.