I need advice with credit card debts

[hugmeyt]

Good afternoon,

I feel like we are drowning in debt atm, and while I have now balance transferred mine to 0%, I just wanted some help as to where we are going wrong, while we ain't putting anything on the CC they ain't coming down as much as I would like!

or

if you can get 0% interest deals and husband cant

can you pay off some of his debt with your card? Then shift it onto a 0% deal? Be careful though, as using your card might end the 0% deal you are currently on

Thanks all, will try and get his shifted to 0% too

Definitely do that. If your DH card is charging interest and he's only paying the minimum it will take decades to pay off. He must transfer to a 0% deal if he qualifies and pay off as much as he can each month.

He also needs to pull his finger out with his phone. No-one needs to pay that much anymore.

Do you watch bbc and live TV to justify the TV licence? If not, cancel it.

Look at deals on ready made takeaway style food in supermarkets as an alternative to the real thing.

Also analyse your spending over the last few months to see where your money is going as the expenses you've listed don't account for all your income.

I will admit takeaways have been a major issue we have spent £200 plus on them a month sometimes, but we are slowly getting better

Are you eligible for any tax credits or nursery funding?

@TheInterceptor we use the tax free childcare so it isn't quite as bad for childcare

Is your partner on board with clearing the debt as fast as possible? If not it will always be a challenge. If he won't come on board I'd make a plan to at least clear yours within the 0% period and leave him to it with his!

Having been in debt before, I think the realistic course of action is to make a plan that balances getting rid of the debt with not feeling deprived. For instance, as you like a takeaway, budget for on every month. You will probably be more successful that way than if you cut them out altogether.

Get the other debt onto 0%, or as much of it as possible if it if you can't transfer the whole lot.

Make a realistic budget - and stick to it. Put down everything line by line, you've missed a huge amount of expenses in this post. The folks on the money saving expert debt free wannabe forum will critique your budget for you and suggest where you can economise.

Thank you all so much for the advice,

We have both balanced transferred our cards to 0% mine is 22 months, his is 29 months, this should mean we can clear it off a lot quicker!

Well done, this is a good tactic with the 0%. If you do your budget too, you will probably find you can throw more money at paying off the debts as well. If you cut down the takeaways, like you said, I am sure this will help a lot.

Then when you've cleared the debts you can move on to saving, which feels great. Even if it's only in a small way, like saving for Christmas. To be honest, I never managed to save when my DCs were small, as you have the natural urge to give them lovely Christmases and birthdays, days out and other treats. Then they keep growing out of their clothes and shoes! But you actually have a better income than we did, maybe you can do it. Although the cost of living has got higher of course. Good luck.

On the subject of phones talk to the companies involved. I'm with EE and for every year you are with them you get loyalty points / they might call it something else.

The points can become a discount so I currently pay £3.28 (It has just gone up from £3) a month for unlimited calls, unlimited texts and 40GB data.

This is a SIM only deal but that means I can choose to buy a phone from anywhere.

Also talk to the credit card companies, they are all different but they all have an obligation to help. They can freeze interest, or close the account - yes it has an impact on your credit score but your score is probably quite bad already.

I had a card with Vanquis, when I had a problem paying I called them and explained the situation, I'm now paying that card off at £1 per month with no interest.

The CAB can be good, even just finding info on their web site.

Instead of thinking, "We have to pay X on CC" change it around, do a complete income and outgoing with everything from a coffee or a 10p dropped in a charity tin to wear and tear on cars, to birthday presents, everything.

Then what you have left over is what you can spend on debt.

There are a few bills missing which will add up.

Can you increase your hours or DH pick up overtime ?

@hugmeyt super rough calculation done and I am not yet firing on all cylinders. However I think you are entitled to Universal credit.

Worth looking into.

Thanks everyone! Have applied for universal credit this morning with husband!

Excellent. Did you do a calculator to see how much you were entitled to? I thought the entitlement was more than the saving for tax free childcare.

Wow, you've made quite a bit of progress at reducing the debt already, just by getting the larger debt onto an interest free card! Now all the money you pay will shrink the outstanding balances much more quickly. And I think you might be pleasantly surprised at the Universal Credit result, I've done a calculation for a family on similar income recently and they got a few hundred a month, although their rent was higher.

I've managed to persuade Sky to cancel clients' contracts on grounds of hardship, it might be worth asking them. That £60-odd a month going on your card debt instead of to Sky would make quite a dent in the balance over a year.

Something I've found helpful for clients is to have a month where you don't buy anything that's not essential. A month isn't a long time to go without treats, and it brings home how much you spend that isn't really necessary. And it shows that you can get by on less when you need to, when a big expense crops up.

If you concentrate on throwing as much money as possible at those debts, you'll be surprised how quickly the outstanding balance comes down. And once they're paid off, you put the money you were spending on repayments into saving for things. You may never need to get into debt again!

I agree!

I won't say how much I think it will be, as I worked it out very roughly in my head, but it will be enough to make a nice difference. 😀

It depends on whether we can get UC to cover some of the rent as we live in rented but rent from in laws and been like this for 3 years. I am hoping we would be able to get some of childcare covered too! Calculator came out about £680 with rent included and about £285 without the rent. But I like I say we shall see!

@hugmeyt You will need a tenancy agreement. Renting from close family members is allowed as long as it’s not a contrived tenancy. Ie only for the purposes of claiming benefits.

Also you’ll need to give up the tax free childcare now you have UC claim and yes do the childcare through UC.

i would advise that you start putting the UC money into a savings account or at least a good chunk of it. You’ve not been used to having it. The reason you’ve got into debt is because you haven’t had any savings. Try not to rely on it to live on and also it can go towards Debts.

Once you get UC look at social tarrifs for broadband. See if you qualify for Watercare. Do any of you have any health conditions that mean you use more water eg eczema.

Thanks @CornishTiger we do have a tenancy agreement that was signed 3 years ago when we moved in, I think this was the issue when we tried to get universal credit when we first moved in, they thought the tenancy agreement was made for that reason but it wasn't, no idea what we would have to do else. My father in law has rented this out for the last 14 years so not just to us.

Tbh proving a contrived tenancy is quite difficult if there is a tenancy in place and previously the landlord (your in laws) rented the property to other tenants. You should have challenged that decision and it would have been reconsidered with sufficient evidence.

Good luck. I’m assuming that £680 is without the childcare added in at 85%. I got a higher figure- however it was a quick calc in head and only one coffee onboard.

Good luck. I hope the UC makes a significant difference to you. It sounds like you have been living on much lower income than the government expect you too for years. No wonder there is debt.