Really need some debt help.

[Moneymoneymoney24]

I’m so embarrassed to even write this, but I have got myself into quite a bit of debt; approx 14k.

Abit of background, I’ve never been good with money, growing up we were really poor and my mother was really frugal so I have no idea why I’m like this.

for the first time in my life I’m in a well paid (for me) job. I’m earning more than I ever have, £1800 after tax. Am married and partner earns approx the same, but we keep finances seperate so no joint account -my choice. We split bills evenly. We’re lucky that we moved house approx 18 months ago and got a really good interest rate and didn’t borrow as much as the bank were prepared to lend, so our mortgage payments are ok - £580 a month.

Husband has no debt other than mortgage so the debts are all mine. I’ve compiled a spreadsheet of everything in terms of my debts: I’m paying £230 just minimum payments on credit cards a month, £200 a month on a loan (which will be cleared in 3 years), am in my overdraft every month (clear it on payday then back in it by the end of the month) so am also paying a monthly charge for that.

I just don’t know how to tackle it. I have 3 weeks before I get paid and have 120 pounds left - this needs to cover my half of the food shop, fuel costs and car insurance - other bills have already been paid. This happens every month, sometimes I have a few pounds left and that’s it. I know the cost of living has gone up, but I don’t think I can blame my situation on that. A few years ago I had started to make extra payments and it started decreasing but I seem to not be in a position to do this anymore.

I feel so stupid, I can’t believe that in my late 30’s, earning more money than I ever have (through hard work) that I’m in this position and feel terrible I can’t offer my DC more fun days out etc. Its not that the money is going on luxury items such as holidays etc, we haven’t had a holiday for years - went abroad once 12 years ago. This is in no way a goady post, I know there are people out there much worse off than me but I would really like to tackle the debt. I don’t want to do anything that would impact my credit score so no DMP’s or IVA’s - I want to pay it off, cut up the cards and never get credit again.

does anyone have any ideas, or has been in a similiar position and got out of it?

Martin Lewis' MSE site has a board where you can anonymously input all of your expenditure and posters will offer advice. I sometimes offer advice there (not an expert just canny with money). Posters there tend to be non-judgemental unlike on here 😳 The specific board is Debt Free Wannabe. Good luck 🍀

Could you talk to your bank and combine the credit cards into just one loan to pay off?

Speak to https://www.stepchange.org/ and see if they can advise.

Second for the MSE site.

How ever you tackle it, the most important thing is to be clear on where every penny is going. It feels like a big task, but will give you some real clarity.
It's often things like Birthdays which add up, you don't think of them as regular spend, but even £20 for a friend's birthday adds up when there always seems to be a birthday in a month.

Yes I’ve been exactly where you are.

First thing is to compile a big household budget for everything: income, outgoings etc. make it detailed and include absolutely everything. Then see where you can make savings ie set a budget for food, car costs etc and stick rigidly to it.

Secondly, look to move credit card debts to 0% balance transfer cards with the longest 0% term and use the £230 to pay against it saving you interest and fees. If you can move the loan too then do that and pay all £430 against everything to clear as quickly as possible.

It might take a couple of years so be prepared but if you stick to your budgets and pay down the debt it can be done.

As others have said, look at Money Saving Expert on the Debt Free Wannabe forum as there’s a wealth of free information to help you deal with it.

Best of luck!

Speak to your parnter he might be able to help

Would it be worth him looking after the money side of things and say gives you a set amount each week or month

Does your husband know?

it’s no good him wanting to spend on food etc if you don’t have the money

I wouldn’t hand over the reins to someone else for money as that isn’t taking responsibility and will knock your self esteem further, you can sort this but may need help from various sources - all ready listed so will not repeat

i would look at setting out your budget, use either Martin Lewis website budget or I like This budget planner as it gives a useful page at the end of where your money is going and has the great advantage you can input weekly or monthly or yearly for different parts without having to work that out yourself

look into trasferring some of your debt onto an iterest free credit card - if you dont use it for spending AT ALL you can get a set amount of time with no interest, such as 12 months, or 16 months, etc, then pay it down as hard as you can - all your payment goes on reducing the debt then, not on paying intersest.

I did this, there is normall y a set up charge of aroun £2oo depending on the card, but not paying interest saved me thousands. When the interest free period runs out- the interest can shoot up to something massive, like 35% - but at that point you transfer again,

I reduced my debt steadily and quickly over several years doing this - you do have to watch it like a hawk, dont get caught out with your debt on the wrong credit card when the interest shoots up, and dont spend anything on the credit card either,

but stepchange, is also a brilliant organisation, and getting your husband onside might help. But not if he isnt going to be constructive

Can you list out your monthly expenditure for us? We might be able to help you cut some costs.

Op, you need to be clear with your debts and make maneageable repayments that also allow you to eat/live.

contact them and discuss reducing interest payments
cut up cards now!

you do need to let partner know
good luck

Just get a loan to cover all of it. Would be about £260pm over five years - Sainsbury's bank example. Cut up credit cards and cancel overdraft. Simple.

You need to talk to your partner.
If you earn the same, and split everything evenly, either he has a similar debt level, or you are paying for more than half (top up shop, you always get he car with an mpty tank etc etc).
You need to work together to stop accruing more debt - and that included overdraft fees - and then work out how to reduce it.
Good luck - don't try to do it alone.

Hi everyone,
just wanted to say thanks for each and every response. I’ve not replied as I had a bit of a downer about it today, but I’m over it now. I think the advice given is fab, I’ve looked on the money saving expert websites and there is some good advice on there- will also be speaking to steps2change.

I definitely need to compile a spreadsheet, I’ve downloaded a free app that budgets for you so when I get paid again I will keep track of everything with the plan that any extra at the end of the month goes towards the debt. We don’t really buy a lot of convenience foods etc as I make a lot of our meals from scratch so don’t think I can cut down on the food bills etc, but I’m sure there are other things I could cut back on - thinking about the fact that someone said I need to account for every penny it’s the odd things that are probably adding up that I don’t even realise. I haven’t told my partner, he really does have no debt as he gave me his bank statements when we applied for the mortgage. I know he would be supportive but I feel like I’ve really let him and our family down. I worked for many years in much lower paid jobs and now I should really be able to treat them but can’t because of my ridiculous debt.

i just have one other question, which debt would you start to try and tackle first? The smallest one so it’s a sense of achievement, or the largest one (currently at 29% APR but would take years to clear).

I'd get rid of the smallest one if you could do it fairly easily and can't consolidate, although I'd definitely try and consolidate if you've got one at 29%!

Why are you waiting until you’re paid next?
Start the budget now. Track your actual outgoings from your statements. You need to understand where your money is going now.

Please tell your husband. I can’t imagine how hurt I would be if a partner kept something this huge from me.

Also look to see if you can get balance transfers to 0% cards so you’re not paying interest you don’t need to.

The sooner you list all of your expenditure the better… don’t put it off any longer.

Always pay off the highest interest first

Thank you @GoodChat. I don’t think I’ll be able to consolidate, I looked on my banking app at a personal loan and it said I was unlikely to be approved - have checked my credit score it is quite high with no missed payments or anything but I guess they factor in my current debt so see it as risky to lend more to me.

I think you’re right and I’ll try and start with the smaller one, I’ve worked out if I can account for every penny then I really should have some left over at the end of the month and could clear the credit card with the smallest debt on (£1300) by the end of the year if I made overpayments of 100 on top of the minimum payment.

Sorry, I disagree. The 29% one should be your priority. If your smallest debt is £1,300, then if your 29% is £2,000 that’s £580 a year added to your debt just in interest.

I would come clean to your husband and see if he can help you get back in control. Ask him if you can hand over your cards to him.

Could you get a part time job? Even one evening a week doing 3 hours at you local pub on minimum wage could allow you to pay off an extra £100 a month.

You're right, actually. I was thinking of the good feeling of paying off the debt but it's irrelevant if you're racking up half of that again on more debt.

I second what @Doggymummar said - always, always pay the highest interest rate debt first.

You need to talk to some experts.

Get to Money Saving Expert, but before you do (they are harsh but fair) the things to pull together are:

1. What are the loans, credit cards etc in terms of principle, and what is the interest on all of them? This is probably one to get some advice from e.g. step change if you have very expensive ones like 29% as even if you could only move that one to a different, cheaper option that would be a really good start.

1. What exactly is your income? Do you e.g. get child benefit on top? Is there any opportunity for other income - overtime etc?

1. Look back at the history of what you have been spending - separate out your debt payments, and don't spend any more on credit cards so the debt payments are totally separate from day to day spending.

For spending, often people's budgets get broken by irregular spending: car tyres, insurance, new shoes/uniform for the kids, birthdays, Christmas, haircuts, prescriptions, glasses, house repairs. All this stuff needs to be averaged over time and accounted for in a budget. If you think about it and are really honest that's usually the point at which you can make changes.

So that's you then set up for an initial "statement of affairs". Then you'll need to look at where you can cut back or where you can increase your income.

If you can't shift your debt to lower interest options then pay the highest interest debt first. You also need to not fall into the trap of paying minimum payments - you at least need to keep up what you currently pay.

I.e. minimum payments £250, but once you have paid the debt down they go to £240. Keep this at £250 and the debt decreases faster.

The MSE folk are much better at this but if you follow the above to start with you'll be in a really good place to start a thread over there.

Finally, you need to be honest with your partner. This is going to take several years to resolve, and you need to be one team so you aren't being tempted to spend money you don't have, by someone who doesn't even know there's an issue. Why not talk to them after you've done all of the above stuff, so it's not just "omg I screwed up" but instead "I screwed up, but I realised it, I've gone away and done X, Y and Z and I have a plan to pay it off in Q years - I need your moral support to keep me on track"

(specifically you need to go to the Debt Free Wannabe forum of MSE, not just the main site)

You cant clear it because you've reached the tipping point where all you can afford to do is service the interest. The only was out of this is to get help and debt management plan. This will tank your credit rating for a while, but in the long term its much safer than trying to tackle this yourself. Speak to Stepchange, they can negotiate with your lenders on your behalf and get it consolidated into one monthly payment on a much lower interest so you can actually start paying back the principle.

Your husband married you for richer, for poorer. All household income is joint. Tell him, and together you will pay it off so much quicker. Could he get an interest free card for two years to pay it all off?

Is everything truly split 50:50? What about stuff for the kids, if you buy shoes for them does your DH transfer half the money? Or smaller things like ice cream or toys?