Debt stress and feeling ashamed

[Hoisinbin]

Morning,

Had anyone just walked blindly into debt? We’re early 40’s, good jobs (combined 110kpa)
but we have 50-60k of debt between us. I’m angry and pissed off that we’ve let it happen, I’m also ashamed that as two supposedly educated people with good jobs, we’ve managed to be utter financial cockwombles.

we’re not struggling to pay etc but we need to sort it now. Cards are all chopped up etc.

everyone around is seems to be financially sorted and I feel like we’re the only ones to have this level of debt.

pleas tell me that we’re not alone 😫

Hi OP

Just wanted to say, we were in a similar position a few years ago (£80k debt). We're now about 2 months away from being completely debt free. It will feel like a dark and heavy burden right now, but with focus and determination you can do it and you will feel so much lighter for it.

My whole attitude to debt now is completely different. I hate debt. Even though I'm a high earner, I live small not large and everything feels like it's in control. My new obsession is saving and investing, making my money work for me not me work for my money.

Have a long hard think about where all the debt came from, because that is what you need to tackle first.

Slow clap.

There was a thread not so long ago where someone posted that, in their experience as a debt advisor, they were seeing a lot of decent earners with a lot of debt.

Quite often, it's down to years of a relatively small amount of overspending and repeated consolidation so paying interest on interest. The debt could have amounted from something fairly simple and seemingly benign such as one extra meal out a week that was not in the budget.

Plus the increased cost of living meaning that you have less disposable income. Has your mortgage gone up yet, or is that another bump in the road you need to deal with?

You say you can afford all the payments, which is good and it could well be that you can get out of debt with a bit of belt tightening, ie reduced spending on non essentials. See if you can do without most holidays/meals out etc for a year or two, except perhaps something quite modest, so you don't feel like you have no life. But that depends on your appetite for getting out of debt as fast as possible vs having a bit of a life - see what you can do free or very cheap - eg National Trust membership is £10 a month, which can give lots of cheap days out if you take a picnic rather than go in the cafe.

I second the recommendation for the MSE budget/debt advice. If you reduce all your expenses where possible (question the cost of everything like phones, broadband, food shopping etc etc) to free up as much as possible to throw towards your debts. Also if possible, transfer balances to 0% cards so payments go on reducing debt not interest.

Then pay down as much as you can. Concentrate on the highest interest charging ones first, but also try and pay above the minimum (even if just £1) as this removes a minimum payment market off your account, which improves your credit file and might allow you to qualify for better balance transfer offers.

Can you earn any more (overtime, second job, babysitting?)

Good luck, you'll get through it in no time and come out better the other side due to learning how to budget and thinking about what you really value in terms of spending money.

I don't think you're alone. DH and I earn combined income of £160k and about 5 years ago managed to build up around £18k of credit card debt between us. Mix of accumulation of 'stuff' as well as me using a bit during mat leave. We took out a joint loan to consolidate it which is now repaid. We each still have around £2.5k which we move between 0% cards. I guess you need to think about it as part of a bigger picture - how much is your mortgage for example? We've taken equity out of our home a couple of times for house improvements but as it's bundled into the mortgage it's not quite the same as unsecured debt but it's still debt all the same.
As long as it's manageable and you're paying as little interest as you can then you're probably fine with that amount.

Not helpful

You certainly won't be alone in having high levels of debt. Just because people around you seem to be financially sorted doesn't mean that they are. However, other people having debt isn't really relevant to your position so don't let that give you a false sense of its ok.

The good news is you have a great joint income between you so you should be able to tackle this debt in anger and make some real traction quickly. You have mentioned what your outgoings are or how you have accumulated these debts or what the interest rates are?

You need to be ruthless and do a strict budget and make some sacrifices to clear it.

Do you have any savings or investments? What is your pension provision looking like? You still have 20+ years to plan and build up a retirement fund but it will need the focus now.

You are not alone. https://moneynerd.co.uk/average-personal-debt/

There is something (well, multiple things actually) seriously wrong with our society to lead to this.

Anyway, if you want to address it I would really recommend the debt free wannabe board on moneysavingexpert. Apart from a budget and loads of tips, you will find heartening stories from people who have overcome much larger debt burdens than yours, starting from a position of NOT coping, too! The very best of luck on your journey and well done for facing up to reality (which many people fail to do, contributing to their problem.)

Apologies, this is a better debt link - the one above is unclear how much it includes mortgages. https://www.money.co.uk/press/uk-personal-debt-rose-a-third-in-2022

Please please don't let this reassurance - the fact that it seems almost everyone is in debt - lead you to avoid tackling your situation. You will be SOOO much better off if you aren't paying interest to these sharks!

OP I’m not sure if you’ll find this useful but there was another thread similar to yours back in April and some advice on there

https://www.mumsnet.com/talk/money-matters/4784159-my-debt-confession

I always view any debts in comparison with my net worth. Now I’m 50 my debts are minimal but I’m not averse to using credit either.

On your salaries your debt should be manageable.

Following with interest, I’m on 48k and have about 20k debt. I really need to call someone.

It's okay OP. Since there is a good income, the only thing you need to become debt free is a good plan, and the time it takes to pay the debt back. It's that simple. A good plan should budget for savings, but also for fun money, holidays and little problems like needing a new washing machine. The plan needs to be realistic so you can keep following it. In a couple of years you'll have savings instead if debt.

You are not alone. Go on to MSE debt forum. However that does not mean you should not do anything about it. You have a good income so shouldn't have that level of debt and indicates you either don't bother to budget or manage your money or don't know how to. Given that things happen and you never know when your income may fall or disappear I would tackle it now.

Well done you .........😏

Oh honey trust me there are many in your boat. I was drowning in debt after my divorce. I had to pay the prick off after he left me in serious amounts of arrears and then I had legal fees etc. I had a car loan, credit card was maxed etc My only saving grace was that I had the house and made a deal with the mortgage company to capitalise on the arrears and then made payment plans with other places too. I think it took me about 12 years in total to claw back my finances and now I have a good credit rating again etc but it was a long slog and there were many sacrifices but now I am at the stage where I only have the mortgage and have cleared down everything else. YOu just have to prioritise this debt and knuckle down to clear it off and while it will be soul destroying at the start it will be worth it in the end. I feel you though as it is so stressful when you feel like you are drowning in debt. Best of luck to you x

I think it must be incredibly common. A lot of people drive very nice cars, wear designer clothes, bags etc, eat out, have fancy holidays on average salaries. An average salary would mean that credit buys all of these.

I'm curious where your debt comes from and how easily that can be changed.

MPs have let the country run in debt for decades, they don’t feel shame.

you’re sorting out the issue, you’ve woken up to what’s happening & tackled the debt. Your debt is half your annual income, which for the average income would be £15k of debt.

best of all is you’re learning a valuable lesson by this failure, as you see it otherwise you’d not be ashamed.

you have plenty of time to seriously turn this around, especially when you realise how quickly you can pay off the debt with some effort - you can then save fir your future afterward

Now that's a lovely, humorous, kind post xx

and very well done by the way! That must have felt insurmountable at times xx

I think that it may be worth using a debt calculator on stepchange to see what they recommend. Or perhaps the snowball method and start with your smallest debt first whilst paying the minimum on the others.

Exactly my thoughts.

I also have an excel budget for a rolling 12 months and pretty much stick to it. I think if you’re serious about clearing this debt OP, it will start with the budget and you may have to live a stripped back lifestyle until it’s cleared.

Say many of us until life takes over- il health, bereavement, redundancy, etc etc.....
You are far from alone OP. Get in touch with a charity such as Stepchange. You will be fine 💐

You're not alone, at one time I was on a debt relief order and we struggled.

We now have an income of £110k ish and probably about £23k of debt. Half of that is on the family car, which was an extravagant spend but ticked all our boxes (and I LOVE it, I still get buzz driving it so imo is worth every single penny)

DH can be a bit slap dash with his credit card, which frustrates me as I'm more of a use my credit card and pay it off within 2 months. I get points which is why I use it.

Debt in itself isn't a bad thing, if you're paying it easily and interest isn't insane and it was for a worthwhile purchase then fine. Its frivolous spending on credit and/or when you can't pay it off, that's a debt problem.