Just worked out how much we owe…

[EmbarrassedDebt]

Sat with DH tonight as it’s a week till payday and we have nothing left, so started a spreadsheet for our income and outgoings we are broke like absolutely destitute

In doing this I’ve found out between us we owe

55k’s worth of debt no wonder we have no fucking money

credit cards stand around 17k

cars around 9k on one and 7k on the other (nearly £600 a month on car repayments)

we have 4 loans between us owing 18.5k (seriously didn’t know this)

and other random stuff on finance (shed, tv, sofa)

Dh earns around 40k and I’m on 35k

I literally have no idea what to do but seeing it all down on a spreadsheet make me feel sick.

so far I’ve started a new spreadsheet sheet with the amount owed on each credit card and the interest rate & looking at ways to start paying it down.

I am horrified 😞😞 I’ve been half heartedly for a new job and looking at a second job but now that is something really important on my list of things to do…

please no nasty comments I just needed to get this off my chest and then plan a way out of this mess.

randomly we both have reasonably good credit scores as well I check those tonight as well

my partner lostvhis job so we used credit cards . We eventually split but the debts were in my name . I spoke to all the cc companies and got them to freeze the interest so all my payments come off the debt and it is gradually coming down .I just kept one card for emergencies. I also got a second job . It’s a long haul OP but I hope to be debt free in 3 years. When I moved I managed to furnish the house with mostly second hand stuff and hand me downs from friends. The MSE forums are very good and not judgemental. Good luck.

Just to bump the fact that the real advice you need will be on the mse forum and step change.

they have saved me (and a friend of mine) from crippling debt. I first found them 12 years ago and still go back to the forum to ask for advice on finance.

All I would say is with this amount of debt I doubt you’ll get any new borrowing, but could definitely make some head way with what you can change. You are not destitute, just in a financial mumble.

I cannot echo this enough. The support you need is here; (getting a second job may well work for you but no point doing anything rash until you’ve got a plan of how you’re going to fix this)

mse - forums.moneysavingexpert.com/categories/reduce-debt-boost-income

stepchange - www.stepchange.org/?gclid=CjwKCAjw-rOaBhA9EiwAUkLV4rxKSwhK2m7T-z9rvkewMbRDzlgfN78O7kpzJfnsvGFTYx5s8nhSRhoC8EcQAvD_BwE&gclsrc=aw.ds

Anyone reading this thread in a similar position to op I also say go to mse and/or stepchange. It is sickening to be in this position but getting a grip on it is a relief like no other.

searching for debt support online can throw up companies that offer to help you with debt for a fee - do not use these it’s unnecessary. Stepchange is free at all points of use.

Hi I hope this doesn’t come across as preachy because it’s not - I too have struggled with money and debt and know that sick to the stomach feeling well. I’m speaking to you as someone who has been there and come out the other side. Id say the cars sound extravagant and an easy save. We also need two. We bought one for £3k outright, the other is 12 years old and cost £500. We have spent about £700 this year on two new wheels, last year we had new brakes at £1100 - but you are paying that five or six times over if you add up repayments. I just think you should reconsider this - running older cars is doable. We earn between us £130k but with three kids, two cats, a mortgage, after school club and nursery fees for the youngest we really have to watch our money, and we just can’t afford an expensive car. I also recommend seeking expert advice. Rather than having you stop paying entirely, the credit card companies would hopefully be able to cut the interest rate and work out a repayment plan. That’s how I dealt with my debt. I used a service to do it and it was very efficient - I’d seek advice though first because there are free ways to do this. Don’t despair - this is fixable x

One of the reasons we have my car is my old one just became unreliable, was costing more to fix each month and constantly breaking down with 2 kids and living rurally I needed something more reliable so it seemed like a good idea at the time, my car payment is £240 which isn’t that bad.

DH car was done when he had a car allowance - we kept the car when he was made redundant but it’s more expensive than mine, around £390 per month.

I will look at changing them and see what we can get for them and look and getting something we own outright, my car payments end next June.

Unsurprisingly I didn’t get much sleep last night and I was up and down like a yo-yo

once the kids are at school I will make a start on going through my list to look at, I am going to do another spreadsheet and look at the snowballing method or similar if I can get the figures to work I will look at contacting a debt charity.

I’ve encouraged DH to look at other jobs, paying what he used to get paid before covid, he look a massive hit salary wise once he found a new job and hasn’t actually really looked for another job we were just glad he got a job after all the that time.

I will look at a second job, and see what I can do to find a new one (I work for a local authority) so I know I am vastly underpaid but have a quite secure job. However I am happy to move if I can get more money.

I don’t have any family so Christmas has always been just about the kids, luckily or not I have bits and pieces I’ve picked up during the year, main presents will be scaled back considerably.

I have a very busy morning ahead of me…

Well done for realising and setting up the spreadsheets.
Agree with others go on money-savingexpert and get some advise, write out your SOA as it stands and then go through each line to see whether you need it, if you do, whether you can reduce it.
Make sure you're on all the cashback sites for any shopping.
You switch currently has a 30g talk talk sim only for £7.95 a month if you need that much data, get 2 of those and you're already £104 better off.
Try and move your credit cards and loans into 0% or consolidated.
Ask for advise on mse...they are really good and helpful.

For Christmas, if you have clubcard or nectar points, use those for food or presents. Look online for second hand fb selling too.
It's really tough but in January when you've already done the hard work, you will feel so much better.

Well done on setting up a spreadsheet, you need to take control of the situation. Account for your income and record the debts to the last penny, and from now on, keep a detailed track of all spending. It looks like you need to consolidate as I suspect your debt payments are currently too much for you to live within your income. Your first priority is to rearrange the debt to reduce income and make the monthly repayments affordable.

You have no idea.....
If the op has downsized... she doesn't have ANY room for the items in her shed ie a dining table and chairs, bike etc. I've just been through the same, I've secluttered but my house is full and I've had to get ridbof things I want to keep (sentimental reasons) but can't. Life isn't as ideal as you want to make out.
Also (nit sure if it's you who said this) but there is NO way I would sit on camping chairs for 2 years when I can get a new sofa interest free and pay monthly. I don't give a damn what you think about me for that but my god, it's cold enough generally without the added warmth of a sofa.
Also buying a second hand car at the moment is horrendous as they are so so expensive therefore you're paying more than previously and getting a worse car which will cost you more in repairs and upkeep.

Unfortunately, I think many people are in your situation. Cheap credit encouraged people to buy now, rather than save up to buy later

What's done is done. No point in beating yourself up. Better to look forward, not back

Is your DH fully on board with (1) reducing debt (2) reducing spending and (3) increasing income? If so, there's probably lots you can do to chip away at the debt

Sort out the phone contract today and immediately divert that monthly payment to your highest interest date. You will achieve something right away and feel more in control for it.
By the end of the weekend you need to have researched the best loan consolidation and interest free cards you can find. Then apply for at least one of them to start with.

Dizzygirl I agree about the camping chairs but why can’t people have more awareness of their income and outgoings and cut their cloth accordingly? We would never buy a sofa set on interest free as it increases our compulsory baseline spending by too much. Instead we did in fact use a mattress for 3 months and saved up for a second hand sofa.

Phones are definitely on my list of things to do…

Ive just found out we still paying for internet at the old house as well 🤦‍♀️🤦‍♀️ that’s another £45 a month. I have no idea why? The contact was changed to this one and a new DD was set up for a cheaper rate £25 so we have been paying £70 🤦‍♀️🤦‍♀️

This is going to take me hours to look at in details.

OP, what happens when the car payments finish? Will you get to keep the cars without a balloon payment, or will they be yours to keep with no further payments?

If the latter, and they're not hugely extravagent, they might be worth keeping while you get out of debt and save up for new ones so you can replace them when they need to without taking out finance. But if they're on PCP or similar, and you've made more than 50% of payments, you're allowed to hand them back and make no further payments, so this might be worth looking into. But then of course you need another car.

I know you've had to move around a lot and that costs money, but is there any possibility you can move somewhere you can do without one of the cars? If your DH is only really driving to work and you're doing all DC running around as well as working, if you lived somewhere where he could walk/cycle/public transport to work?

But definitely go through all this together with DH, to make sure he's on board with cost reduction and other changes that are needed.

If the internet thing was a mistake on the provider's part, ask for the extra money you've paid to be refunded.

Get rid of the cars and buy a couple of second hand ones for 3 or 4 grand, I'm amazed that people can say they're destitute and have cars worth what 20 grand total? or something sat outside. DH used to work 50 miles away so did a lot of driving and we never spent more than 3 or 4 grand on a second hand car, cars are so reliable these days you really don't need to spend huge amounts on them.

It may have already been said (it’s a long thread) but if you definitely need two cars can’t you downgrade the ones you have?

we live in a London borough so have been lucky to be able to get by on one car but we bought our “new” one in 2020 for about £8k in total

im sure you could get much cheaper cars to get you from A to B while you sort the rest of your debts out, then upgrade again when you’re back on an even keel.

Can you cancel the old Internet contract and get a refund? With the refund, use the money to pay towards another debt.

Go through your house and gather old toys, stuff you don't use and clothes to sell. People are now looking on preloved sites such as vinted and FB marketplace for bargains. Sell what you can and open a separate account for your grocery shopping. At least you've got money for food and daily expenses then until payday. In Nov use the money to pay off debts and keep Christmas expenditure to a bare minimum.

Hey well done for finally wanting to get a grip on it OP!
Loads of great suggestions on here, with your last post it definitely sounds like you dont actually look at your bank statement/account regularly at all, so could it be an idea to sit down with your DP weekly and just scan through whats gone on? I say this because you by your own admission have let some big things slide through unnoticed, so im thinking that you might have some smaller spending habits that are adding up here too - buying lunch out every day etc, going out for milk and coming back with loads of extras etc. Its worth scrutinising regularly cos its so easy to get into bad habits!

Just to pick up on something you said as well - you mention you didnt think your own car payment was that bad, but it seems like you think that because you are comparing it to your DPs which is higher. As gently as i can say this - those are both really high. Yes its becoming more common to have high car payments, but for your income level and the fact you rent not own and everything else those are both bonkers payments. So i suppose what im saying is, try and 'stand back' from other stuff - instead of thinking 'well its normal' follow that up with 'but is it necessary for it to be that much or do i have other options' but apply this to EVERYTHING. You can do this, you are taking a huge first step - this is the beginning of the rest of your life.

If you are so inclined, a good exercise for you would be to calculate the interest you have been paying out on all this debt / loans as that's just throwing money away.

I'm older and was brought up with the mindset that if you didn't have the money you'd have to save up for something or else couldn't buy it.

You could have got a sofa on freecycle to sit on and then saved up for the one you wanted with instead of getting into debt.

I've found in the end a lot of consumerism is just so meaningless. It's easy to get caught up in the lifestyle illusion but does it actually make you happy? Maybe ask yourself next time you shop whether the item is a necessity or a impulse purchase.

I agree that the shed is a symbol of the bigger problem. However you bought it before you knew you were in fifty thousand pounds worth of debt otherwise you would have probably bought a tarp for the tools, squeezed past the lawn mower in the summer house, put the sewing machine in the corner and used the bikes to get to work!

Now you've done your sums and you can take control of this. Take inspiration from posters like @Mooshroo who have come out of the other end.

As much as I’d love to ride my bike to work I can’t, DH works 30 miles from home I work 20 miles away

on top of that how would I get the kids to school? An 8 mile bike ride on single track 60 mph roads I don’t bloody think so…

anyways off to look more into it all now

Try not to dwell too much on the wasted money of the past, it has already gone. Look at how much extra you will have going forward - you've already found more than £100 each month by cancelling your previous internet account and changing onto sim card only with the phones.

Is a moped an option? We live rurally but DH work was only 8 miles away - mopeds are a fraction of the cost of a car.

Are you England? The kids should be able to get a bus to school unless you've chosen an out of catchment school, or does that not fit in with work times?

Not if you have moved house.

No bus as they are at primary school