Drowning in debt
Discussion
Hi,
Posting under different username, as embarrassed and ashamed really - I know it’s my own fault, but it’s come to a point where I really don’t know what to do.
I’m £24,541 in debt over 4 cards, short version is Covid, new child, and home move (we rent). These are not excuses, I’m just explaining the circumstances that this all came from.
I earn £25,500, in a secure job and am paying the minimum payments on all cards - this is a major struggle as I can’t afford to do this so I then spend on the one to recoup some of that payment.
It’s come to a point now that relationship is breaking down due to me not being able to put enough money in the “pot” and she doesn’t know why.
I have thought about IVA etc but I need my credit file to be clean for work - any defaults, CCJ’s, bankruptcy or IVA’s would cause me to lose my job.
I’m a mess, my home, work life is a mess and I have 0 social life.
I have no assets apart from an 18 year old car with very little value. I have thought about cashing pension in but after looking into this I’m not able to due to age.
What advice would you give, without the cynical pistonhead ness please.
Thank you
Posting under different username, as embarrassed and ashamed really - I know it’s my own fault, but it’s come to a point where I really don’t know what to do.
I’m £24,541 in debt over 4 cards, short version is Covid, new child, and home move (we rent). These are not excuses, I’m just explaining the circumstances that this all came from.
I earn £25,500, in a secure job and am paying the minimum payments on all cards - this is a major struggle as I can’t afford to do this so I then spend on the one to recoup some of that payment.
It’s come to a point now that relationship is breaking down due to me not being able to put enough money in the “pot” and she doesn’t know why.
I have thought about IVA etc but I need my credit file to be clean for work - any defaults, CCJ’s, bankruptcy or IVA’s would cause me to lose my job.
I’m a mess, my home, work life is a mess and I have 0 social life.
I have no assets apart from an 18 year old car with very little value. I have thought about cashing pension in but after looking into this I’m not able to due to age.
What advice would you give, without the cynical pistonhead ness please.
Thank you
Edited by SilentHero on Wednesday 19th July 11:19
Sorry to hear about your very difficult situation.
The facts are that only making the minimum payment is not going to address the issue, and obviously everything else you spend on the cards is going to make it worse - and worse 'for ever' if only minimum payments are being made. So you have to find a way to make more than the minimum payment to start reducing the amount.
Are there options for overtime or any other ways of increasing your income?
I do think you need to tell your partner the situation and see if you can jointly find a solution. As you have alluded to, it is already going downhill and I can't see that discussing it with her would be worse.
You really need to cut up the cards today, that's the first step. Then focus on how you can get the payments over the minimum and start eating throught the debt. I am not a fan of taking out new cards to solve problems, but would you have any chance of getting a 0% free period on another card to transfer some of the debt?
Good luck.
The facts are that only making the minimum payment is not going to address the issue, and obviously everything else you spend on the cards is going to make it worse - and worse 'for ever' if only minimum payments are being made. So you have to find a way to make more than the minimum payment to start reducing the amount.
Are there options for overtime or any other ways of increasing your income?
I do think you need to tell your partner the situation and see if you can jointly find a solution. As you have alluded to, it is already going downhill and I can't see that discussing it with her would be worse.
You really need to cut up the cards today, that's the first step. Then focus on how you can get the payments over the minimum and start eating throught the debt. I am not a fan of taking out new cards to solve problems, but would you have any chance of getting a 0% free period on another card to transfer some of the debt?
Good luck.
Well you've done step one, which is to address the problem head on.
If you've been able to maintain your minimum payments then your credit rating may allow you to refinance some or all of the debt with a personal loan at a lower interest rate. I guess you're cards are probably averaging 30 per cent or more per annum? You might also find you can shift some to a low-rate balance transfer card.
You may also need to have a very honest conversation with your partner about cutting costs, which I would imagine will require some difficult charges such as finding a cheaper property to rent.
Are you also sure that you're accessing every last penny of government assistance you might be entitled to?
If you've been able to maintain your minimum payments then your credit rating may allow you to refinance some or all of the debt with a personal loan at a lower interest rate. I guess you're cards are probably averaging 30 per cent or more per annum? You might also find you can shift some to a low-rate balance transfer card.
You may also need to have a very honest conversation with your partner about cutting costs, which I would imagine will require some difficult charges such as finding a cheaper property to rent.
Are you also sure that you're accessing every last penny of government assistance you might be entitled to?
In addition to what others have said there are many places you can go for advice, but beware sharks.
2 that I would suggest are
https://moneyandpensionsservice.org.uk/ Which is a government agency, formally the Moeny Advice Service
And Citizens Advice.
I would think that simply sitting down and talking with somebody impartial would be a great help as a first step.
2 that I would suggest are
https://moneyandpensionsservice.org.uk/ Which is a government agency, formally the Moeny Advice Service
And Citizens Advice.
I would think that simply sitting down and talking with somebody impartial would be a great help as a first step.
I sympathise with you, many of us have been there.
Talk to your bank. Ask if you can have a loan then pay off and cut up your credit cards.
It'll be hard, but if you smoke or drink, stop or cut down if you can. If you have Sky TV get rid. Reduce all unnecessary spending.
If you possibly can, try and get an evening job as you need extra income.
An honest conversation with your partner may help, especially if they really are on your side.
You can get through this and your financial attitude should be improved ultimately (I know mine was).
Good luck.
Talk to your bank. Ask if you can have a loan then pay off and cut up your credit cards.
It'll be hard, but if you smoke or drink, stop or cut down if you can. If you have Sky TV get rid. Reduce all unnecessary spending.
If you possibly can, try and get an evening job as you need extra income.
An honest conversation with your partner may help, especially if they really are on your side.
You can get through this and your financial attitude should be improved ultimately (I know mine was).
Good luck.
Edited by Pitre on Wednesday 19th July 11:41
First you need to be clear with your partner. You are a team and you need her on side.
Second you need to cut up the cards, prevent any further usage.
Third you need to contact the card companies, explain your situation and come to a repayment agreement that suits you. They are often both understanding and accommodating.
Fourth you need to budget & understand where you spend money and what can be cut back a bit.
Fifth, any option either to up salary or to do some additional part time work to help balance the books. Odd evening behind a bar or or something apparently the hospitality sector is screaming for people. It’ll only be temporary.
Second you need to cut up the cards, prevent any further usage.
Third you need to contact the card companies, explain your situation and come to a repayment agreement that suits you. They are often both understanding and accommodating.
Fourth you need to budget & understand where you spend money and what can be cut back a bit.
Fifth, any option either to up salary or to do some additional part time work to help balance the books. Odd evening behind a bar or or something apparently the hospitality sector is screaming for people. It’ll only be temporary.
You need to see how much of the balance you can get transferred to a 0% card on the longest term possible, set up a direct debit to pay it off in full by the end of the term, but if you can't afford to do that, then pay off the maximum you can every month, then shift the debt to a new 0% card in 12mths or whenever the 0% period ends.
Talk to the current 4 providers and ask what 0% deals they have to consolidate all the debts to them, it's better than trying to takke out a 5th card. Tell the providers you are struggling and they'll have specialist teams that can help you.
Then whatever balance is left take out a fixed rate loan (will be far lower than credit card interest) and setup a DD to ensure it's paid off by end of the term.
Overall that should reduce your monthly outgoings.
Sign up to MSE newsletters, become a spendthrift on everything you do, every pound saved goes in a virtual jar and goes towards the debt.
Sign up to a debit card provider that has an auto-round up feature so every time you make a purchase for say 90p, gets rounded up to £1 and 10p goes into the savings pot.
Any side hustle work you can do to generate extra income e.g. Deliveroo rider - pedal power no fuel needed. Evening/weekend bar work. WFH admin job you can do in your own hours etc etc.
Can you get a new job that pays more, even if it's only an extra £1.2k per year, that's an extrea £100 a month towards the debt. Or a new job with same salary but opportunity for overtime.
Moneysavingexpert wensite and forums should be your new best friend.
Talk to the current 4 providers and ask what 0% deals they have to consolidate all the debts to them, it's better than trying to takke out a 5th card. Tell the providers you are struggling and they'll have specialist teams that can help you.
Then whatever balance is left take out a fixed rate loan (will be far lower than credit card interest) and setup a DD to ensure it's paid off by end of the term.
Overall that should reduce your monthly outgoings.
Sign up to MSE newsletters, become a spendthrift on everything you do, every pound saved goes in a virtual jar and goes towards the debt.
Sign up to a debit card provider that has an auto-round up feature so every time you make a purchase for say 90p, gets rounded up to £1 and 10p goes into the savings pot.
Any side hustle work you can do to generate extra income e.g. Deliveroo rider - pedal power no fuel needed. Evening/weekend bar work. WFH admin job you can do in your own hours etc etc.
Can you get a new job that pays more, even if it's only an extra £1.2k per year, that's an extrea £100 a month towards the debt. Or a new job with same salary but opportunity for overtime.
Moneysavingexpert wensite and forums should be your new best friend.
Thank you so much for your replies, I dreaded posting to be honest with fear of the usual responses.
I have checked with bank and they won’t allow me a loan as my debt to income ratio would be too much of a risk.
Overtime wise I have changed roles and am more hands off so to speak so there isn’t an opportunity for overtime in my current role - I did get a slight pay rise though.
3 out of 4 cards are destroyed - the one left has a smaller balance which is why I kept it in once piece.
As soon as I tell her it’ll be over, there are other issues and I am concerned after reading many posts on here about child access issues and CMS coming for me which as I understand they have very little care for the non resident parent.
Part time job is a good shout, I will look into this!
I have checked with bank and they won’t allow me a loan as my debt to income ratio would be too much of a risk.
Overtime wise I have changed roles and am more hands off so to speak so there isn’t an opportunity for overtime in my current role - I did get a slight pay rise though.
3 out of 4 cards are destroyed - the one left has a smaller balance which is why I kept it in once piece.
As soon as I tell her it’ll be over, there are other issues and I am concerned after reading many posts on here about child access issues and CMS coming for me which as I understand they have very little care for the non resident parent.
Part time job is a good shout, I will look into this!
In my late 20's early 30's I was in a much worse position than this, as it transpired so was my partner which didn't help.
we sat down worked out a plan and then put everything we could into clearing it off, it took us over 7 years to clear it all and that included me working two jobs to bring in extra funds. As has been said you need to be open with your partner on this and work together to solve it.
It certainly taught me a lesson in being more careful with money.
we sat down worked out a plan and then put everything we could into clearing it off, it took us over 7 years to clear it all and that included me working two jobs to bring in extra funds. As has been said you need to be open with your partner on this and work together to solve it.
It certainly taught me a lesson in being more careful with money.
Talk to your partner. This affects them too. Assume you live together so any failure to pay rent affects them and your child. Another assumption is this debt is through good intentions of giving them the best so explain that. The truth sets you free and should lift the weight/burden. Hiding it is no good for either of you and you will reach breaking point, badly.
You need to reduce the interest payments so as already mentioned, can you consolidate into a loan? Left field - 0% balance transfer credit card and chip away at the cost.
Additional employment for you and your partner. This will be tough and with a new baby, time is so precious but it's short term. I have a new baby so understand the time and cost element.
Go through all your outgoing and see where you can trim anything if you've not already.
Rent will be your biggest expense, can you move somewhere cheaper while you get back on your feet?
I wish you the best.
You need to reduce the interest payments so as already mentioned, can you consolidate into a loan? Left field - 0% balance transfer credit card and chip away at the cost.
Additional employment for you and your partner. This will be tough and with a new baby, time is so precious but it's short term. I have a new baby so understand the time and cost element.
Go through all your outgoing and see where you can trim anything if you've not already.
Rent will be your biggest expense, can you move somewhere cheaper while you get back on your feet?
I wish you the best.
Rent wise is responsible, 490 pcm - 2 bed house in a fairly safe area. We were lucky to get the house as somebody dropped out.
The larger balance is on 0% for about 11 more months, I’m not eligible for any other cards.
It gets worse I forgot to mention Overdraft - constantly in it, banks words were relied upon heavily.
£25k with decent job security and decent pension contributions, I have GCSE’s but no other formal education
The larger balance is on 0% for about 11 more months, I’m not eligible for any other cards.
It gets worse I forgot to mention Overdraft - constantly in it, banks words were relied upon heavily.
£25k with decent job security and decent pension contributions, I have GCSE’s but no other formal education
Contact someone like step change, they assist and it doesn’t always effect credit score.
Look at freezing the interest and repay what’s owed.
Try to open up to your partner, if the issue is causing I’ll affects on your relationship, she should understand it’s that and not a lack of interest from you.
Look at freezing the interest and repay what’s owed.
Try to open up to your partner, if the issue is causing I’ll affects on your relationship, she should understand it’s that and not a lack of interest from you.
eliot said:
Going to be hard - but you need to list out all your outgoings and do a Starmer and "make tough decisions" on what you can live without.
I bet you have your phone essentially on finance by paying £40+ a month for the contract.
This. It’s impossible to begin to work anything out or make a plan if this information isn’t known.I bet you have your phone essentially on finance by paying £40+ a month for the contract.
Op - do you mind me asking HOW you managed to accumulate the debt?
At the risk of stating the obvious the very first thing you need to do is to create a budget and then stay inside it. £25k per annum should give you £1800per month, You should also be entitled to some benefits such as child tax credit. All in all 9as long as you can discipline yourself) things should be repairable.
You mention "pot" - how much does your partner put into this?
At the risk of stating the obvious the very first thing you need to do is to create a budget and then stay inside it. £25k per annum should give you £1800per month, You should also be entitled to some benefits such as child tax credit. All in all 9as long as you can discipline yourself) things should be repairable.
You mention "pot" - how much does your partner put into this?
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