Deep in debt

[Rahna1]

Hi

Any advice on how I should pay back 5700 debt end of this year with just under 1000 a month income? Never had this amount of debt before and I'm going crazy every one demanding their money and I don't know where to begin. 1970 pound is on credit card and interest rate is adding every month.

I would start by phoning everyone you owe and see if they can set up payment plans for you.

Contact either stepchange or christians against poverty (you don’t need to be religious) and they will help you work it all out.

Stepchange is who you need to contact to discuss options.

There are I believe charitable organisations who can help you manage your debts & sort out payment plans for you with those you owe money to.
Try a Google search or phone local Citizens Advice bureau.
You can do it. Don’t panic.

www.gov.uk/options-for-paying-off-your-debts/debt-management-plans

Try this. Knowledge is power.

A friend of mine works for step change and says that she absolutely loves helping people get their finances sorted. She said just put everything in a bag and take it to them. She said the relief that people feel is absolutely tremendous afterwards.

Can you increase your income?
Why do you need to pay off debts by end of year? Are you in arrears with any?
Are you solely responsible for the debts?
Have you sought help to clear them?

Then,
List your debts - amounts and interest rates.
List your fixed outgoings, including essential bills.
Put every single penny not accounted for into paying the debts - pay off the debt with the highest interest rate first, while paying minimum payment on the others.

Up your income. Is there a reason you cannot work full time?

Thank you i will try to contact them. want something drastisk like f.eks 300 of my income without entering my bank account and paying like that

£300 for 9 months is £2,700 so you will still have a way to go. Good luck with getting is all sorted. Once you have a plan of how to deal with it you will feel much better.

Can you not take additional work, that is below minimum wage for full time over 25

Not enough information given. What else do you need to pay out of the £1000 and do you have any assets? Do you have a partner, DC?

You shouldn't be scrimping on essentials like food or utilities to pay unsecured debt.

Have a look at money saving expert and go through all the steps and do everything that is relevant.

www.moneysavingexpert.com/loans/debt-help-plan/

I always say to take an extra job if you can find one and can sort any childcare arrangements.
Best way imo and when you're working so much you have less time for spending, and are less inclined to part with what you're working so bloody hard for on frivolities.
Once the debt is cleared, carry on working the extra till you've saved a buffer.

Step change were fantastic with me, really helped me out. I was paying over £500 of debt every month on a £1200 net salary.
Take on additional work is a good idea, but don't exceed something like 45 hours a week. Nobody needs to be killing themselves working 60 hour weeks or 7 days a week

Agree with stepchange, also look at debt camel

First and foremost though, take a breath, drink some water and be proud of yourself for talking this.

Whatever has happened, has happened, whatever has gone has gone, debt is overwhelming easy to get into and hard to get out of, use the help that is available and be proud of facing into and not burying your head.

You can do this, it's all about making good choices from here on

I found the Ramsey baby steps helped. Not everyone does but I became an avid listener of the podcast and still listen now that I am debt free. www.ramseysolutions.com/shows/the-ramsey-show

It breaks things down in to steps. You can then break down in to even smaller steps, so you can set yourself daily, weekly, monthly goals.

You need to stop digging the hole... so you stop using debt, build up a small emergency fund so when something unexpected occurs you do not resort to taking out debt. You pay off debt, starting with the smallest one, as that is the easiest. Setting yourself a challenge of paying off £5k is hard. Setting yourself a challenge of paying off £500 is easier.

There is only so much you can cut in your life. To get out of debt you often need to increase income.

Depending on your credit rating could you switch to a 0% card or one with a lower interest rate? Do a balance transfer to move everything to that so at least you’re paying off the actual balance and not the interest.

Martin Lewis has a template letter that you can send to your creditors to stop interest and fees and offering them a payment plan. I did this when I was £17k in debt in 2014 and have now been debt free for three years.

Stepchange really helped me. I wish I'd contacted them sooner as I would have less worry and sleepless nights. Honestly they are brilliant. They help you work out a realistic budget covering absolutely all your outgoings and breakdown how much you can afford to pay your creditors. They contact them all for you and also help with any further demand letters they might send. I received debt letters for perhaps the first 3 months but I've been on my dmp for 11 months now and they back off when they can see you're making regular payments every month. Stepchange take one payment per month and distribute it to all your creditors. Honestly I can't praise them enough for their help and support. You will feel so relieved after if you speak to them. Good luck

I think your income is the issue. Easy to get into debt on a low income.

Is there any way you can make more money?