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Debt Help in General

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23 Reviews

Struggling to get all those niggling debts in line? Take a look at these reviews for some handy tips and hints.

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    23 Reviews
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      16.11.2011 19:05
      Very helpful



      Debt is all we hear

      And so still people blame the debt crisis on the banks, the same people who took out loans to buy nice cars, plasma TVs and that holiday in Kenya. This naïve opinion that capitalism and the west can exist without borrowing has taken hold. The only way banks can make a profit is by lending at 6% and paying 4% interest on savings. How could the regular punter who flat out blames the banks for the recession afford his dream 170,000 mortgage on his 25,000 salary? The bank is lending you 170,000 pounds guys! Where do you think the bank gets that money to lend you? Right, it invests other people's money and takes their interest on their loans and credit cards to do just that. Admittedly the investment banks got carried away in the City when the government green-lighted those dodgy trades that were producing fifty billion a year tax for the treasury to pay for their vote winning social programs but why wouldn't you want your government to create jobs with public money? Trust me, no dodgy derivatives in circulation would have seen the recession only hit early in Blair's reign. The system works if the lender lends and the person who takes the loan or credit card spends within their limits. Yes our deficit is big and the banks were indeed bailed out with 00 billion quid of our money but don't forget we blow 150 billion EVERY year on welfare payments alone, which just so happens to be the gap in those balance of payments. One-in-eight of the London rioters were on Incapacity benefit!

      The uncompromising capitalist spin doctor is that man called 'advertising', the mystic who makes you think you have a hole in your life and this particular product will fill it to make you happy, when all the time you were fine. But if we don't buy stuff we don't buy crap we don't actually need we start to lose our jobs. We are all paid into this system and the protesters outside St Pauls can protest all they like but there is no alternative because human greed and the need to want to have things will always win out. I don't see many poor people in those protesters. I bet they have quite a bit stacked on their credit cards they are not telling us about.

      Western debt is basically the three trillion dollars we borrowed to buy cheap Chinese goods and the Chinese has put all the money in the bank and so not buying our stuff. Their middle-class has yet to grasp the brand culture fully and so not decked in Burberry and Gucci like the Italians. Until they spend we are bumping along the bottom forever more. The Tories are straining every sinew to drive unemployment over three million again by chainsawing the public sector and quite happy for it to remain high to control public spending. China and the Far East can make everything for a $1 per hour so our manufacturing base is done for. The entrepreneurs are the only ones who can get us back to two million and we have seen what idiots they are on Dragons Den.

      Paying Back debt is what we are all trying to do now; another reason the economy is slowing like a creaky old steam train pulling into the station. Four billion a year more credit card debt was paid off last year than the previous year and only payday loans are on the increase. If you get into the position where you can only borrow from these sharks to pay your rent and put food on the table then that's beyond my pay grade and I don't know how you can get out of that spiral. I do know you can declare yourself bankrupt far easier today to clear most of the big debts but that a stigma you will have to carry. I think new Labours slackness on welfare allowed people to get comfortable on the dole and so they had more kids and so the debts rose, why we have so many pawn shops and pound stores now on the high street. Blair created a huge underclass that would vote for him so to keep the welfare heroine coming.

      Rolling credit for lower interest payments on your credit cards is harder now and banks charging a percentage on balance transfers to deter that. If you can get your debt down that way then by all means try it. It beats a trip to Ladbrokes! I do that all the time and now have just two hundred on one card. My debt level is pretty good, paying the three percent minimum every month on the card and letting my brother deal with the mortgage. Mortgages terrify me. But for young people of today they may never have to worry about them as the average age of the first time buyer is now thirty-one. Unless you have an 18 grand deposit and a 60,000 joint salary you can forget it. But the banks are slowly edging back to their bad habits, only this week yours truly successful in getting a credit card with a two grand limit. Like I said, the banks need to lend to make money and that's not always responsible lending. I have been bought up well and the money I do owe on my card was run up due to a beautiful woman. Men always get in debt over women and here here to that!


      Channel Four recently did a quirky but eye-opening Dispatches special on the Greek debt, the irreverent method of delivery seeing two British workers in Dagenham given a genuine Greek accountant for the week to help them get Greek pay & conditions in England, a bus driver and hairdresser the chosen professions.

      The female hairdresser was 54, the average retirement age in Greece. Any workers deemed to be working with hazardous chemicals for more than 25 years are allowed to retire early on medical grounds, her shampoos and hair dyes coming under that category. She quickly retired. These obscure rules are jemmied in by the various unions who are given them as political favours from the various parties in return for their block vote. Not only that, the hairdresser gets to retire on 90% of their salary for the rest of their years. Not bad aye!

      The 40-year-old bus driver is also in for a pleasant surprise, his salary of 27 grand a year immediately doubled to match time served Greek bus drivers, many of the same age there pulling in 50 grand a year! Not only that but he got a ticketing bonus, an attendance bonus and 100 Euros a year to buy milk? He too could retire young on 75% of his salary. Its clearly not olive oil that allows the Mediterranean people to live to 100!

      The rich also get a fabulous deal, tax evasion how they make hay. The top 14 surgeons in one nice area of Athens managed to declare their income as less than 19, 000 Euros a year, all other work put through as cash transactions and so no tax declared. This is normal practice in Greece as tax dodging is seen as a national sport and you are a mug if you pay it. As far as the people are concerned all politicians are corrupt so why give them money to waste and steal it? The government tried to get the tax back from the wealthy through a swimming pool tax, but only 275 Greeks declaring they had a pool, even though Google Earth mapped 15,000 pools! Locals just bought camouflaged netting and never declared the pools. Those retired hairdressers can also carry on working on the side and not put the jobs though on the tax. The only downside to Greece before the collapse was the dreaded 'Flaki Laki', bungs and bribes paid to get the job done. If your car is on jacks after your MOT the garage will expect you to pay a backhander on top of the fee to get the car off the jacks. If you wanted to get your building work finished on time then its brown envelope time. The shadow economy in Greece is extraordinary.

      The Greek culture of not paying tax and spending all their cheap Euro loans on public service and not building the private sector is why they are flucked, and it's you and me that have to now pay now through extra tax to bail them out. Similar practices are happening in all the sunshine countries of Europe, the so-called P.I.G.S. Even Ireland didn't charge income tax to workers until their salary topped 16,000 Euros. These guys only joined the Euro to carry on living the highlife and no one can see away that they won't default on their loans now and so crashing the Euro.


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        28.03.2010 17:54
        Very helpful



        Never borrow what you can't pay back

        When I was 19 I decided that it was about time I got my own place. I was living with my mum and step dad and I felt like I needed my independence. Looking back on it now, I wish I had stayed with my parents for that little bit longer.
        After moving out my boyfriend and I were so happy we would be getting our own place. We didn't get a mortgage as my aunt's pal had a place she was renting and it was available straight away Long story short it didn't really work out not financially but where it was, and after an attempted mugging on me a week before xmas I decided I needed to be sensible and get a place to call home.
        I was working in a bank at this point and had learnt all about finance and mortgages.
        I was pretty sensible and as my parents said even though I was a bit scatty had my head screwed on.
        I had saved up for my deposit and due to problems with solicitors meant I had to find extra fee money.
        In comes my step dad to rescue me. He lent me the money I needed on the proviso that I paid him back once the mortgage had completed. In the good old days when monetary values were different as was credit I managed to get a cash back mortgage. Not only did I pay my dad back straight away but managed to have enough left over to buy a washing machine and daddykins bought me a fridge freezer.
        So I was set and looking forward to the future. My boyfriend moved in but he wasn't working and as I was earning good money I wasn't really that worried. It was my place and I didn't appreciate how much needed to be paid for.
        The first year went well and I think that was the novelty of having a new home and also so determined to prove to the whole world and his hand that I could do it.
        A year later I realised that bills were piling up and only having one income I was struggling. So I simply borrowed and borrowed and borrowed more, loans and credit cards were to the hilt. I could manage though as I was earning enough to cover my minimum payments so I didn't worry. I thought I was untouchable.
        Roll on 8 years. After leaving the bank due to the salary I was earning and the trekking to London I got a local job which paid more money and meant I had more time to do the things i wanted. I went on holidays with friends and got new furniture and then I got a car. It was all going well. Then I got offered more credit. I didn't even blink an eye as I signed up for a secured loan. I didn't even think about the repayments, its almost as if I thought the fairies would be coming to pay...Needless to say they didn't...
        So there I was stuck with credit of over 15,000 quid and earning good money and pretty much enjoying myself.
        Then it hit me....I got made redundant and the true horror of my situation hit me. I was already behind with some credit but being in finance tried to manipulate the system by making promises to pay on a certain date just to buy me more time to borrow from somewhere else. It was awful, Lost over 3 stone in weight with sheer worry about the next knock on the door or phone call.
        My other half didn't have a clue, he did a bit of part time work but his money merely helped me to cover the basics and I wasn't able to keep up with my mortgage.
        I had been so busy borrowing from Peter to pay Paul that I had forgotten about everyone else. It hit me hard yet I buried my head in the sand. I ignored letters and put a block on my phone so only certain people could call me. I lived in fear though and every day was like a nightmare.
        Eventually I told my friend and although she helped me out by lending me money to pay some bits off I couldn't bring myself to tell her the whole truth about all my debt.
        A year later I had still managed to keep my flat but this time something in me had changed. Although I was scared I decided I had to tell my parents. When it came to it, as I began to talk and seeing the look of disappoint in their eyes I could only bring myself to tell them about my mortgage. They helped me out but I felt worse. I felt like they expected it. I felt judged and worst of all I felt like a stupid idiot.
        I had spent nearly 15 years in finance I should know better. I was so organised and full of advice for others when it came to spending and taking out finance, and would tell people it wasn't the way to go, I daren't tell them it was because I had so royally messed up that was the reason.
        After one of my friends got killed it woke me up more than anything and made me stop feeling sorry for myself and stop making excuses. I decided I needed to get proper help.
        My first port of call was to get a copy of my credit file. I was shocked and horrified as page after page stared back at me with the numbers swirling round in my mind and default and judgement shown in block red capitals. I felt sick. In a way though it was like therapy. It was like I was facing my fear.
        I wrote it all down and called up all of my creditors. I was overwhelming shocked by how helpful they were. Don't get me wrong some of them were a bit tougher than others to deal with but it pushed me into action. I decided I had to get on top of my money troubles. I visited Money Supermarket and joined debt free wannabees website where you join online with fellow debtors who are determined to pay back their dues. It not only made me feel more in control it didn't make me feel like I was on my own. Family and friends and wonderful and can support you but having other people in the same boat if not worse helped me so much. It made me even more determined to sort things out.
        The have money ideas, clubs how to save a penny a day and then at the end of the month putting what you have saved away in a separate account. It may sound daft but once you get your mind into the saving mode its amazing how easy it becomes.
        I then called a debt management agency who gave me advice and guided me towards further help and advice on the Internet. There are many websites that help you with your budget and also can support and talk to you.
        Things are still pretty grim for me but I am in control of most of my debt. It will take me a good 5 years to get myself fully back on track but now that I am in constant communication with my creditors my debt isn't so scary.
        What my advice would be to others is as follows:

        Don't borrow more than you can afford
        Don't sign up for easy quick loans without finding out the interest rate you will be charged
        Don't bury your head in the sand or chuck away bills
        Deal with your debt as soon as you can and contact creditors as you will find if you are honest they will do their best to help you
        Don't ever think you won't be able to see a way out there are many options for everyone no matter what your circumstances
        Make use of the citizens advice bureau and if you are too scared to face walking in you can do it online
        Remember no one is perfect and we all make mistakes don't beat yourself up over it
        Remain positive and focused and make plans of how and when you will pay
        Create a spreadsheet or buy a 49p cashbook to keep track of your in comings and outgoings
        Always think of ways to save money (IE packed lunches, deals on food etc)
        And finally never feel alone with your debt there is always help out there :)


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          22.02.2010 11:08
          Very helpful




          I would like to tell you how i managed to get myself into debt and how i am struggling to get back out of it. I hope this might help someone avoid doing what i done.

          I left school at 16 and started working fulltime for HMRC earning £13000 per annum. Being immature and stupid i messed around taking days off and had to hand in my resignation 3months after my 18th birthday. By this point i was already £2000 in debt. Once i hit 18, my own bank wouldn't offer my a debit card so i went to HBOS who offered me a debit card and £1000 overdraft so seeing the £££ signs i signed up and within a few weeks this was spent on a trip to Blackpool with my partner. My this point i also had run up a Dorothy Perkins store card with £350 of debt and clothes i didn't even need and was approved for a RBS Credit Card with £500 credit limit which i also blew. I was ok with the repayments until i had to leave my job thats when the problems really started.

          It took me 3months to find a job and within that time, i had got very behind with my rent and council tax mainly as my partners part time wages could not cover all the bills and we were not entitled to any other benefits. Once i started working i managed to pay off bit by bit but i was only working part time. We moved from our private let to a housing association home but i took on more debt with Provident and got very far behind with the essential bills. Looking back i don't even know what i spent my money on..takeaways? Gambling? Being so far in debt, i was too ashamed to tell my parents and one night tried to end it all and ended up in hospital. My parents were there for me and i think i did it more for a cry for help. I was signed of work and was due to go back when my employer decided to let me go. I had to total up all my debts which came to over £7000 and my mum took out a loan with her bank to clear most of them meaning we would owe her nearly £300 a month to pay back which didn't actually help as we got further and further behind. I had to admit defeat and moved back into my parents home, my partner moved back into his dads. I was claiming JSA whilst looking for a job and my partner gave my mum money for the loan which i was upset that he had to do.

          I started work again in a shop 16hrs a week but lasted 3weeks as i fell pregnant and they decided to accuse me of stealing and forced me to walk out. I tried to take them to court but they took so long to respond to my letters than i missed the 3months deadline. So claiming Income Support and moving into my current flat at 5months pregnant i struggled greatly. My partner moved in when the Boo was born. Since then i have paid alot of my debt however some companies are contacting me about debts that i don't even owe and its stresses me out wondering which debt letter or phone call i am going to get today.

          I pay what i can, i don't ignore the letters as that is the worse thing you can do. It was my own fault i got into debt and now no one will touch us for debt or credit and we will never get a mortgage. I am ashamed of myself for taking on things i couldn't pay and the day i am debt free i will be celebrating but it will take time for me. My advice is don't take on more than you can handle as no job is ever secure!


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            01.01.2010 13:13
            Very helpful



            It is easy enough to get in debt, but a lot harder to get out of

            It seems ironic that I should work for one of the biggest financial institutions in the world yet I find myself in the same mess as countless others. Everyday I have people asking for my help and I am powerless to help and I go home feeling pretty crap about myself and frustrated. It seems hypocritical because I recognise that desperation and loneliness and even mental strain that the burden of debts can cause.

            My story starts when I was 18. I had an account with Lloyds TSB and had an electron card, as I was soon to go to university I would need to have a debit card to purchase train tickets. My application for a normal debit card was declined but I was offered a credit card with a £2000 credit limit. At first I was very good and used it for small purchases and paid them off when I got paid from my part time job. I then opened up an HSBC student account on the basis I got a 5 year rail card and a £1000 interest free overdraft. Before I even got to University I was £800 into that overdraft. Throughout University I continued to increase my debt, using my credit card constantly. My overdraft limit was increased automatically without any application. By the time I left I had a £2000 overdraft and was £3500 in debt on credit cards.

            When I left University I came home to live with my parents and found a job within a couple of months. I found adjusting back hard, many of my friends were still at university or lived in different cities. I also went through a very nasty break up so I made myself happy the only way I knew how. Spending money. I eventually got to a point where I broke down and confessed all to my mum and it looked like I was going to get things sorted. I got a consolidation loan and a balance transfer and was doing well for a number of months.

            Then I got into another bad relationship with someone who wouldn't work, never paid and was not a particularly nice person. I did this despite warnings from my best friend and am still paying the price emotionally and financially. I took out another consolidation loan and another balance transfer but still spent on the cards. This time I was spending more on luxury items-£150 for a hair cut and drinking champagne when I went out. I then moved out which incurred more costs.

            For several months I continued to pay my bills, but I was going overdrawn and getting charges. HSBC then decided that my overdraft would only be interest free for up to 2 years after my graduation instead of the 3 which had been stated when I originally signed up. I then started to miss payments and so the letters and calls began.

            My rock and inspiration through it all has been my best friend Claire. She similarly got herself into the same situation and after burying our heads in the sand for so long we decided action needed to be taken and signed up with a debt management company recommended by her friend. The only downside is that we do pay them a fee, we signed up to them before we knew about the free ones backed by the government and although things are still not easy they are better. We still receive letters from debt recovery agencies threatening us with court action and bailiffs but we simply forward them onto the debt management company. HSBC were the least compliant of all my creditors, they initially refused any proposed plan and tried to make me sign up to a flexible rate loan.

            The biggest impact my debt has had is upon my mental health. I have suffered severe bouts of depression which have impacted my relationships and strained them. It has affected my performance at work leading me to get a disciplinary and now my job is on the line. I constantly worry, I dread opening letters and I feel like I will never be free of this financial burden. One day I would like to buy a house with my boyfriend but I worry that we will never get a mortgage and it will be all my fault.

            I know many people blame the financial institutions and while to an extent I believe they are partly responsible, I also blame lack of understanding of the financial world and more importantly ourselves as individuals. I am in this mess because of my own stupidity and the belief that I deserved to have those things I couldn't afford. I was reckless and didn't save any money when I was earning good bonus. In the last year or so I have made it my mission to get more financially educated, I have learned that I can't always have what I want and that it is ridiculous to spend so much money on material things. For every person who has realised the same thing there is another still burying their head in the sand. I have lost count the number of people I have read about who have been outraged when their bank won't give them an overdraft, they think it is a god given right to have one and don't seem to grasp that they are asking to spend money that isn't theirs and then they are the first to complain when they are in a financial mess. During the good times people got complacent, they never prepared for the worse, they naively believed their jobs would be safe forever and so refused to protect themselves financially. There are people out there who genuinely believe that because they have been with a bank for x amount of years they should receive whatever they demand. I just think more people need to act like grown ups and take responsibilities for their own actions instead on whining about it being somebody else's fault.

            I personally cut back this Christmas and I know of many others who have, and I will continue to do so in the upcoming year, but I wonder how many low income families haven't and strained themselves financially to provide their children with the latest computer consoles and crazes. My new year's resolution is to rid myself of as much debt as possible, and it will mean working harder and going without but I know in the long term it will work out for the best. For things to get better, societies attitudes towards money and luxury items need to change.


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              27.11.2009 14:41
              Very helpful



              Debt; my experience and tips.

              I like many others on here and outside in the "real" world know what it's like to be in Debt. The nerve-wracking daily wait for the post to be delivered is as bad as the constant ringing of your phone and you find yourself spiralling in a downwards direction seemingly with no hope of ever getting out of it.

              Banks do not help, they give you massive credit limits and encourage you to spend on their cards, you are welcomed in with open arms at first but when you find yourself in need of help they do not want to listen and start a campaign against you that can make the most level headed person begin to crumble. You end up taking out more debt to pay existing debt and constantly "rob Peter to pay Paul" until you reach a point where you can't get any more credit, can't pay what you owe and the realisation sets in that you have made a complete and utter mess of your life.

              This happened to me, I was in a very well paid job and maintained a lifestyle that was by no means lavish but definitely "comfortable" I still liked nice things, I enjoyed holidays abroad and built up a nasty little addiction to online gambling. I could afford all this easily on my wage, but instead of paying for things as I bought them I ended up sticking it on the credit card, spending my monthly wage and put nothing aside into savings. This was fine, I was in my 20's I had a good job, I could afford to repay the minimum payments each month what could possible go wrong?

              My health, that's what went wrong. Whilst I won't go into too much detail here, I suffered a life-changing, devastating illness which robbed me of my career and my ability to pay my debts. I was 29 at the time, I had insurance on loans that I had so they were covered, but I didn't take insurance out on my credit cards and at their peak I owed £17,000 on them. Having no savings and after being "let go" by my employer I now had no regular income. I was forced to go on Incapacity Benefit and saw my monthly income reduce to a quarter of what I was bringing in before. I was married so had my wife to support, regular bills to pay, food shopping to pay for and pay the rent and council tax all this on top of trying to maintain regular minimum payments on my credit cards.

              Desperately I managed to maintain my payments, working out meticulously what every single penny was going on and working out who to pay first at what time of the month and for a few months I did manage to pay on time and keep the banks happy. Inevitably though, life throws a spanner into the works and after falling behind on some payments the banks turned nasty. I was receiving between 20 and 30 telephone calls per day, reminder letters appeared in the post which turned into threatening letters and despite me explaining my position endless times on the telephone and in writing no one would help me. Interest was accruing on a daily basis and my debt was rapidly increasing, late charges and non payment charges appeared and I had finally reached the end of my tether.

              I'm ashamed to admit now that I buried my head in the sand. I did nothing for a few months apart from avoid answering my telephone and ignoring the post. I made sure I paid my rent and council tax so we had a place to live and spent each night worrying constantly about what was going to happen. My wife was aware because of the letters and phone calls but I lied about the magnitude of my debt, all the cards were in my name and I had spent the money. It was not her fault and I refused to burden her with it, I had got myself into such a mess and so it was up to me to get myself out of it.

              Finally I had what is commonly referred to as the "light bulb" moment, seriously sick and tired of the phone calls, letters and stress I looked online for Debt help and found, as many do, Martin Lewis's Money Savings Expert website (MSE.com) I spent hours reading the "Debt free wannabe" forums gathering information and advice where I could. Many posters there recommended people to contact a Debt charity to see if they could work on your behalf to get your creditors to agree to a reduced payment plan so with this information firmly in my head I contacted one of the ones recommended - Payplan.

              Payplan are a Debt management charity that deals with creditors on your behalf, they ask you to be honest about what you owe and have an initial conversation with you over the telephone to ascertain the level of your debt and what your income is. If they consider that you have enough disposable income left after paying essential bills each month they then work out how much you can afford to pay to your creditors on a pro-rata basis. This means that if you have at least £100 available to pay off your debts each month the creditor you owe the most to will get the largest share and the ones you owe less to gets a smaller share. You then set up a standing order to Payplan for the amount they work out and they distribute the money on your behalf. It's worth stating here that Payplan do NOT charge a commission for doing this, everything you pay to them they pay to your creditors.

              Being a charity and backed by the FSA (Financial standards authority) they are also respected in the world of banking so there is a very high chance that your creditors will accept their proposals. It was recommended that I take out a Debt management plan and they wrote to each creditor with the proposals and sent the payment to them each month on my behalf. Luckily for me my proposals were accepted and whilst my creditors were clearly not happy it meant that the phone calls and letters ceased. A DMP (debt management plan) although not legally binding usually results in all interest and late charges being stopped on your debts so you can see each month them coming down rather than increasing, this gives you a sense of hope and you can see light at the end of the very long tunnel.

              I was lucky, I admit. My plan was accepted, the interest and charges stopped and I paid my monthly amount without fail and I continued to do so for 4 years until my mother died leaving me with an inheritance. As my debts had significantly reduced over this time I was in a position to offer a final settlement to my creditors (negotiated via Payplan) and this resulted me in clearing off my debts.

              Nearly 5 years after my light bulb moment my debt was gone and the relief was indescribable, although I had still received the odd letter from my creditors and had to have annual assessments with Payplan to make sure I could continue to afford to make the payments I still always had that cloud above me. My health was affected adversely, my marriage was pushed to its limit and I can't count the amount of sleepless nights I lost with worry, it was without doubt the darkest period of my life and without Payplan I honestly don't know what I would have done.

              To anyone who is reading this in a similar position there are some things that you need to know;

              You are not a bad person, regardless of how you got into debt. Yes it may have been irresponsible of you in the first place, but sometimes these things happen.

              Acknowledge the position you are in and once you have your "Light bulb moment" do something about it. Use mse.com, ring a debt charity or make an appointment to visit the Citizens advice bureau.

              Don't use a debt management company who charge you for their services, Payplan and CCCS (consumer credit counselling service) offer the same service for free and all your money is put towards paying off your debts not to them.

              You cannot go to prison for not paying a credit card. Prioritise your debts and make sure you keep up payments on council tax and mortgage/rent, you need somewhere to live.

              Don't be ashamed to ask for help, your health and your families' health are far more important; don't let it ruin your relationship.

              Expect hassle from your creditors and either change the telephone number that they have for you or demand that they only contact you by writing, they have to do this at your request, if they do not you can put your request in writing. You will find that the phone calls will reduce or stop.

              I cannot stress how good the Charities are, research them online, read other peoples accounts and experiences and contact them. You are under no obligation, they do not judge you and whatever your personal level of debt is they will have spoken to people who have a lot more. They are friendly, efficient and do work on your behalf and experience tells me that your creditors will deal with them more favourably then would dealing with you yourself.

              I realise that this has been a long review, but if it helps just one person then it has been worth submitting. Debt is the worst thing in the world to be stuck in the middle of, and if you are in the position I was in then I do genuinely feel for you. Do get help and don't bury your head in the sand.

              I now have a basic bank account with no overdraft, no credit cards and a shot to hell credit file. I probably won't be able to get a mortgage (not that I could with my health history anyway) and can honestly say that I don't owe a penny to anyone. But I have never been happier in my life than what I am now.

              I got help, you can too. Im giving a Dooyoo rating of 5/5 Dooyoo stars only for the help that is out there, debt itself obviously wouldnt even get a star...

              Thanks for reading.


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                11.11.2009 16:09
                Very helpful



                Do not hesitate. CAB now... today... you still here? GO!

                If you are in debt, the only place I would ever advise anyone to go is to Citizen's Advice Bureau (CAB). Here is an account of my experience with them when I was 19:

                I was about £13k in debt, as a full time student people just kept throwing money at me. I would spend the money on my rent, food shopping, clothes, records, utilities, travel, I wasn't working partly because my course was pretty intense and mostly because I was 18 - I didn't have a clue about the real world. At first I would use one card to make my payments, then another to pay that, it soon spiralled out of control and before I knew it I had 3 Overdrafts totalling £6k, 4 Credit Cards totalling £3k, 6 Store Cards totalling £3k, 2 Mobile Contracts with outstanding contract charges of £300 and £700. I was beginning to feel ill with it, I couldn't sleep and finally at the pinnacle of my debt hell, I quit Uni. I was so disappointed in myself and ashamed. I didn't have any rich parents or relatives to turn to, my credit was so impaired I couldn't get a loan to clear it all. I rang round some debt consolidation companies - I was horrified to find they wanted £300 off me before they would even look to help me! I went to my Mam and she said she would lend me the £300, but this would put me further in debt, I was struggling to get a full time job and on part time hours, it would take me forever to pay her off, along with having to pay the debt management plan.

                The turning point was one night when I got home and my Mam was crying. I asked her what was wrong and she said she had had a bailiff force his way past her in to the property and start trudging through the house asking what was my stuff what could he take - from GE Money - for a paltry £300 store card. I knew I couldn't bury my head in the sand any longer.

                On my parents advice I went to see CAB. I rang up first they said they didn't work on pre-booked appointments, I would have to go down, take all my paperwork with me, sit and wait until an appointment became available. So that's what I did, I attended their drop in. I waited about 4 hours to see someone. I looked around the waiting room and some of the people in there made me feel so uncomfortable, they didn't even look like they had been washed - I am by no means a snob of any kind - but these were real down and outs, who were f-ing and blinding, screaming at their kids, asking me what I was looking at - vile. I felt really intimidated. I could have walked out of their, but I knew it wouldn't solve anything so I waited. Eventually I was called in. I was the last person they could see and some people were told to come back the next day. God knows how you would feel in this situation.

                I had my meeting with a debt counsellor. He was smashing - really kind. He said it was irresponsible of the lenders to give me such large credit facilities when it clearly stated that my occupation was a full time student. He was so nice, he didn't make me feel like I had anything to be ashamed of. He took a full income and expenditure list from me, and he worked out what I could afford to pay my creditors. He drafted letters up for me proposing my payment and he sent them. He responded to their responses. Most importantly, he showed me how to deal with creditors myself in future, enabling me to manage my debts better.

                It was a long process - about 6 months before all debtors were settled with payment plans. Then it was down to me. I kept up with payments religiously and I responded to correspondance I got, including requests for me to increase my payments. I would simply say I cant afford to. Or I would tell them what I could afford. Until January this year I paid my debt religiously - almost 6 years. I had even managed to clear a couple of the accounts Then my circumstances changed drastically.

                I split with my Ex, and had to move to my Mam's so I was paying half a mortgage and secured loan, board to my Mam, travel, debts, etc and if you have read my Credit Crunch Experience I was earning less than I ever had before. I was in trouble, but because I was travelling 30 miles to work, 30 miles back everyday through a traffic blackspot, I did not have the time or the inclination to go to see CAB again. I tried writing my own letters, but some of my creditors just would not accept.

                So I heard about Debt Advisory Line. They charged a nominal fee to take everything out of your hands and sort it out for you. Even better, there was an end date and no further impairment to my record. And I could see light at the end of the tunnel! I would pay them £280 one month, £180 the next as set up fees, then £180 per month ongoing, of which £35 would be their fee. This seemed so convenient and easy, after a 40 minute call with one of their sales guys I was sold - hook line and sinker...

                I paid my money the first two months. And I forwarded all angry correspondance to them from my creditors. I provided them with original copies of all my original debt correspondance and agreements made through the CAB. I did everything I said I would, on time and I paid my money. This began in May 09. I have since been paying each month - and still, agreements are not set up, they still haven't contacted certain creditors and I am now once again credit impaired and I am making and fielding the phone calls to creditors myself anyway. I have just submitted a complaint to get my administration fees back, as I have done all the work myself!

                I guess what I am trying to tell you is that even if you have to book time off from work to attend the CAB then you should do it, because it will be worthwhile investing your time, rather than investing your money, getting further in to trouble and stressing worrying becoming more depressed than you ever were over the debt.

                Do not pay for debt help - CAB do it free and you will come out feeling really reassured and happy. Well as happy as you can be... Remember, you cant go to prison for debt :o) xx


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                • More +
                  05.08.2009 13:08
                  Very helpful



                  There is no debt problem that can't be solved......

                  Over the last twenty years or so, having a credit card (or two) and a loan (or two) has become the norm. Before that, borrowing criteria was stricter, and the banks were not so eager to lend cash, whether for general spending, or for house purchases.

                  With the ease of obtaining credit, whether by using catalogues, applying online for credit cards, or accepting one of the many "guaranteed offers" that came through the letter box from the bank, many people have built up balances that just a few years ago would have been unthinkable. Add to this the fact that many credit card providers have automatically increased customers' limits without request, and you can see how the balances get bigger.

                  Now, of course, I am not saying that the customer is blameless here - no one makes anyone accept credit, no one makes you sign on the dotted line, and sometimes the temptation of easy credit is just too much to refuse when you could do with a new car, a holiday, or just fancy a bit of extra money to get by on.

                  For some people it is simply a case of borrowing money, often at high rates of interest, that they simply cannot afford to repay. Perhaps this is money that should never have been lent in the first place, and probably wouldn't have been lent under the criteria of 20 year ago.

                  For others, they may find that following a loss of a job, a long term illness or disability, or the loss of a partner, for example, their income no longer easily meets their repayments.

                  For some, who have been moving their debt from 0% card to 0% card to take advantage of low rates of repayment, they may find that when the 0% period runs out, there is no new offer to take advantage of, so they suddenly have to find far more money to service the debt than they previously had to.

                  Whatever the circumstances, or the reason behind it, when debt becomes unmanagable, it can take over your life. Worry about finding money each month to pay the minimum payments invades your sleep, robbing Peter to Pay Paul using one credit card to pay another's monthly payment, panicking when the postman comes or the phone rings - it is an incredibly stressful thing to have happen to you......but there is help available - starting with yourself.

                  **First things first**

                  You may be avoiding the post, the bank statements, the phone calls, but until you face up to things, you won't be able to deal with them effectively. Grab yourself a cup of tea/coffee/glass of something stronger and a pad of paper and a pen.

                  Then get all the paperwork you have been avoiding, open it, and write everything down - who you owe, what you owe, how much you need to pay and when. If you are in arrears, write down how many months you are behind. If you are close to finishing a loan, write down when it will be done and how much money you will free up.

                  Then start writing down everything, and I mean everything, that you have coming in, and going out. Wages, benefits, maintenance payments, utility bills, cigarettes, school trips, weekly lottery tickets - it all needs to be added into the equation.

                  **Be honest**

                  It might be difficult at first, but you will have to be honest with yourself. There is no point in trying to do this exercise, which is hard enough as it is, if you avoid the fact that you are spending £80 a month on ciggies, or if you conveniently forget that you spend the best part of £5 a day on a sandwich because you didn't make a packed lunch to take to work.

                  It might not be much fun, but unless you are honest about your situation, you cannot tackle it. You also won't be able to see what you can easily cut down if you don't actually acknowledge it in the first place!

                  **Understand it**

                  If you are in debt, there is a reason why. For everyone it is a different reason. Is it because you lived beyond your means (be honest, remember!), is it because you were trying to keep up with your peers in buying the latest car etc. Is it because spending helps you "feel better", albeit temporarily, until you need the next shopping "hit". Perhaps you are addicted to ebay, want to spoil your children with the things you never had as a child, feel as though you deserve a holiday twice a year.......

                  Is it because you started working part time after starting a family, but didn't change your spending habits to match your new reduced income?

                  Do you constantly set budgets but never manage to stick to them?

                  In order for you to make the necessary changes, you need to understand why it is you are in this predicament. Remember to be honest here. It might take a lot of soul searching, and could be pretty emotional as you face up to realities, but once you have done so, you can start addressing your reasons, taking control, and moving on.

                  **The initial shock**

                  Quite often, the real figures are a shock, as you discover just how much you owe, just how much short your income is, when compared with your expenditure, just how much you need to find JUST to cover your minimum payments. You may be horrified at just how much you have spent on ebay in the last 6 months, or on cosmetics that remain unwrapped in the bedside cabinet.

                  Be prepared for this shock - it is all part of the process.

                  **Seek help from those who can give it**

                  Now, I know we are surrounded by "debt help" adverts on daytime televsion, and on the internet, but these are almost certainly going to be companies that might offer you "free advice" but certainly won't offer you "free help". They might be looking to sell you a consolidation loan, or a debt management plan whereby they take a monthly fee. Please, please, please stay away from these people.

                  Instead, use one of the debt charities, such as Consumer Credit Counselling Service (CCCS) or National Debtline. Both these can be accessed online, giving a huge amount of help and information on all your options, from a debt management plan through to bankruptcy. Website addresses will be at the end of this review.

                  The CAB also have specially trained debt counsellors. Again, the service is free and impartial. If you want to see a CAB counsellor, please make sure you ask for their debt-trained people, as regular counsellors will not have the information and specialist knowledge you require.

                  **don't be put off**

                  I am sure you are aware that debt is more of a problem now, than it has ever been. Therefore there are more people ever than before seeking help. This means that you may have to wait to see someone - don't despair, book yourself an appointment and be proud of the fact that you have taken the first step to gaining complete control.

                  Also, if you don't agree with what one debt counsellor says, you can speak to another one. Sometimes, for example if bankruptcy is recommended as a realistic option, this may not be something you are comfortable with. Speak to another counsellor/charity and see if they have a workable alternative for you.

                  Just remember - don't go to one of the fee-paying organisations.

                  **Just one low monthly payment......**

                  Ads offer consolidation loans all the time. These may initially appeal, as you can bundle all your debts into one, and make one low, affordable monthly payment. They rarely do the trick, though, as unless the initial reasons for getting into debt have been addressed (see above!), the spending will continue, the credit card limits will be maxed out again as you treat yourself to that well deserved holiday/handbag/night out with the lads and you will end up not only with maxed out cards, but with the loan as well......

                  **Don't bottle it up**

                  The old saying "a problem shared is a problem halved" is very true here. Many people have kept their debt worries to themselves, not even telling their partners. Shame, guilt, uselessness......all feelings that many experience as they try and battle things alone because they feel as though they have done something wrong.

                  Although it may not be easy telling those closest to you, and there may be fireworks, sulks, and genuine bewilderment as they thought you were completely in control of things, if you can work through a situation with someone - friend, colleague, partner, parent.....it will be much easier. Just for the fact that you can ask someone to run through figures with you, give ideas on what you can cut back on etc. Two heads are better than one.

                  Whilst you may not want to shout about your situation to all and sundry, it is very difficult to carry on making excuses as to why you can't join your work mates for a drink after work, or why you can't contribute to the latest leaving collection/lottery syndicate. Sometimes, simply saying "I'm cutting back on what I am spending right now" or "things are just a bit tight this month" can take the pressure off you - and I would hazard a guess that some of those around you are in similar situations and will actually be relieved that someone else mentions it first!


                  MotleyFool and Moneysavingexpert are two of the websites that offer online forums for support and ideas. Whether or not you have been able to tell those around you, why not go online and check out for yourself that there are others in your situation, and there are solutions and ways forward.

                  **Take control*

                  From the moment that you open those unopened bills, you are taking control. That is a very powerful thing to be doing. Every step you take, is a step closer to being sorted. That is something to be proud of.

                  If you need to contact your creditors to offer reduced payments, you will be able to get template letters from the National Debtline website. Don't allow yourself to be bullied into paying more than you can genuinely afford. Take a deep breath, and stick to your guns. If it ever went to court, the court would take into account your necessary expenses, and provided you have been honest, will only make you repay what you can afford to pay....nothing more, so the creditors wouldn't get any more than you are offering anyway.

                  **What is the worst that will happen**

                  Martin Lewis of moneysavingexpert fame says that there is not a debt situation that cannot be resolved. OK, it may be that Bankruptcy or reposession is involved, but even that is not the end of the world. Whilst these things should never be taken lightly, if you retain you mental wealth, does it really matter if you have had to surrender your bricks and mortar? Not a situation anyone wants to find themselves in, I know, but ask yourself, truly, being honest.....what is the worst that can happen?

                  Compare that "worst case scenario" with the sleepless nights you are currently experiencing, the extreme stress you are under........now, which will you choose?

                  **It won't go away overnight**

                  The chances are you didn't accumulate this debt overnight so it won't go away overnight.

                  See it as a diet - you didn't wake up one morning to find yourself 3 stone overweight - it crept up bit by bit. That means, that you won't start weightwatchers tomorrow and find that by the end of the week you are 3 stone lighter. You will lose a lb or 2 a week, sometimes putting on a lb but over a period of time, you will steadily lose weight.

                  What you WILL have done at that first weightwatchers meeting, is made the decision that you are going to do something about it - you take control of your eating habits.

                  Debt reduction is like weight reduction - you face up to it, address your eating/spending habits, take control, and take the necessary steps towards getting where you want to be. It might take a while, but then Rome wasn't built in a day.

                  **What not to do**

                  Don't ignore letters and phone calls - they won't go away, and if a court sees that you have made no attempt to solve the problem, they will be less sympathetic to you.

                  Don't consolidate - it rarely works, depsite the promises from the ads.

                  Don't go to a fee paying company - there are freebies out there that will do the same job for you, without taking your money.

                  Don't expect it to be sorted overnight.....it takes time, but you will get there.

                  Don't be afraid or ashamed. You are not the first to be in this situation and you will not be the last.

                  Don't bottle it up - that only increases your stress. If you can't open up in real life, open up online in one of the specialist forums for support.

                  Don't give up - it is a long struggle at times, and you may have a blip from time to time (like a dieter having the odd binge) but as long as you keep looking forward, and stay realistic, you will get there.


                  Take control - that feeling is immense when you realise you are taking control, rather than your debt taking control of you.

                  Be honest - you can't solve the problem if you don't admit what it is you are solving.

                  Be proud of every step you take. You are making valuable changes to your life here.

                  Ask for help - it is out there - take advantage of it.

                  www.cccs.co.uk 0800 138 1111 Opening times: M-F 8am-8pm

                  www.nationaldebtline.co.uk 0808 808 4000 Opening times: M-F 9am-9pm, Sa 9.30am-1pm

                  Citizens Advice Bureaux - www.adviceguide.org.uk

                  Christians against Poverty - www.capuk.org


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                  • More +
                    04.08.2009 01:10
                    Very helpful



                    Use your brain with your card

                    In today's economic meltdown where money is almost being hemorrhaged by the financial systems put in place to look after it, we all need any tips, tricks and secrets to save money. Obvious those of you with credit cards, will be wanting some inside information that you may not have known about. So here you are with an insider who will reveal 6 things you may not know about Credit Cards, that may be costing you money. so heres some tricks to save you money and use them wisely.

                    1- Making payments on time: If you make a monthly payment like most credit cards do, make sure you pay it on your due date. Paying it too early may end up with your being charged a fee for a late payment because the system picks up the payment as being made towards your balance, not your monthly payment. This causes lots of trouble between customers, the banks and the bank's collections staff, who regularly need to point customers onto disputes (which in turn causes the customer to pay for the phone call). If a customer pays their payment too early, they will likely be charged a further 12 GBP over here, they will need to re-make the payment for the amount and they will take a negative hit on their credit rating. It's not worth the hassle, the time or the cost to make your payments too early.

                    2- Remember, you can change your due date. Following on from the previous point almost seamlessly, remember if you call your bank they are often able to change your due date for whatever reason. So if you're missing your monthly payments every month because they're due in the middle of the month and you don't get paid until the end of the month, call them and explain that to them. There may be conditions on this (HBoS will only do it three times in the life time of the account), but it will save you money once again. For example in an average year missing your payment, you may end up incurring 144 of charges, whilst you could sort it out with a free 5 minute phone call. This seems to be something customers are either unaware of or have just forgotten. But it's a brilliant little thing to realise.

                    3- The evil Roso: In Britain it's currently legal for a credit card company to do what is known as a Roso, if a customer has a current account with the same bank, the bank can go into your current account to reclaim the owed debt from you. Though this is almost verging on theft as far as I'm concerned, it is totally legal and you (as a customer) have signed contracts agreeing to it. Sadly many customers are again unaware of this and whilst no one wants to sit and read through a load of legal mumbo jumbo just to to find out all these little morally objectionable tricks, it's in the customers interests to read them. An obvious way to avoid this is to bank with a different company to one where you have a credit card. Simple really when you consider the hassle that a Roso may cause you, with banks taking out money that was left there for you to cover your bills.

                    4- Over-limit: This is something I still can't understand myself, but customers can go over their limit, which, let's be honest, means that the limit is non-existent. The customer could go over it for a wide variety of reasons, though, so let's go through them first: A lowering of a limit- The bank may have lowered your limit for some reason. Interest has taken you over- The interest on your account has taken your balance over your limit A reversed payment- A Direct Debit has been reversed on your account (advice would be to speak to your bank) Overspending- You've spent over your limit

                    Now the first 2 of those are almost "tricks" by the credit card provider to catch you for an over limit fee (of again around 12), but the customer is responsible for being in a position where the interest can push them over their limit. The lowering of a limit should be spoken about directly with the provider, as I'm unsure on that side of things (sorry). A reversed payment could be because, for example, a direct debit has been refused, which would mean your bank will charge you (around 8) and the credit card provider will charge you (12 late fee, 12 over limit), which is rather costly. To prevent this make sure you have the funds needed in your bank account. Over spending, I'm unsure on whether or not it's possible to over-spend on your card, though it presumably isn't. With the card providers you never really know.

                    5- Debt Management Companies: Not to be confused with a debt consolidation company (who will give you a loan to cover your debts then put you in a position where you make payments to repay the loan), a DMC will talk to your creditors about your financial situation and try to arrange a repayment structure with them so that you can make manageable payments to all of them. They are brilliantly useful. Some have been known to actually reduce a persons credit card debt by up to 45%, and banks do regularly push for you to use them. Free ones such as PayPlan and CCCS are often advocated for use by customers struggling to make payments to their creditors. However, when you first meet them they will swiftly tell you not to make any payments to your creditors, which is poor advice. You should continue to make payments until your DMC and your creditors have made an agreement between each other as to what the payments will be, as your account will still be incurring charges and interest, making your repayments larger. You also wiil be receiving negative credit marks for the future by following their advice.

                    6- Personal Details: With todays society of scare mongering and identity theft many people are now refusing to talk to people from the banks who call them. Regular tasks such as informing someone of a missed payment quickly over the phone has become a chore due to people's over-protectiveness concerning personal data. But what they don't seem to realise is that banks actually ask for data that's in the public domain such as post code (can be found in a typical phone book, or online) and a year of birth (can be found at a registry office and anyone you have ever applied for a job will have these details).

                    People working for (or on behalf of) a bank will NEVER ask for bank details (barring card details for a payment, or a direct debit), if they do, feel free to hang up. The reason they ask is to stop people from getting your card details. Let's all be honest now, if they got the wrong number (i.e you'd moved out and not informed them) and someone said they were you, and they then got told all your details you'd be pretty rightfully fuming. Thats why the security checks are done. A bank will never ask you for details such as "Confirm your card number." They already have this so why would they need to ask? Yeah they have your post code, get it wrong and they will ask for the first line of your address, get it wrong and they will terminate the call. Emails are rare from your bank unless you do e-mail banking, if you get them, phone your bank to see if they're legit, and NEVER type your bank details in a reply or a link that looks suspect.

                    And the biggest secret of all credit cards, is to know how to make the most of them, use some common sense and read the terms and conditions. -


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                    • More +
                      06.06.2009 14:22
                      Very helpful



                      A very helpful Discussion Board

                      Having read some of the excellent reviews on this subject, and rather than expanding on, or adding to, previously introduced ideas and suggestions, I would like to make readers aware of a website that is, quite simply, the single most helpful resource I have yet found on the subject: -

                      The Motley Fool - Dealing with Debt discussion board.


                      For those who have not heard of the Motley Fool site, it is one that my husband spends most of his on-line time on, covering as it does most aspects of personal finance and investment, and one of the keystones of the site is the breadth and diversity of the discussion boards.


                      The DWD board we used when my sister got into serious financial difficulties, and the wealth of practical advice available was truly amazing, as were the number of posters who had been in, or were still in, the same sort of financial problems, so there is a great balance of help, advice, and support.

                      On the right hand side of every post is a list of links, and one of the most important is the pro-forma SOA, the vital Statement of Affairs, where every source of income and every single outgoing is listed, along with interest rates and terms. When posted to the Board, the SOA is analysed and commented upon, with clear practical advice being given, and suggestions were savings can be made sit alongside links to unclaimed benefits or grants - many posters to the board comment upon the fact that simply sitting down and listing everything helps them enormously to see the whole picture rather than focusing upon items in isolation.

                      Items, which are of fantastic help, are: -

                      Snowballing - a technique which deals with the debt with the highest interest rate first, paying the absolute minimum off everything else whilst paying all spare money off the most expensive loan so as to clear it as quickly as possible. When that debt is clear then focus all attention onto the next most expensive, and when that is finished move on again. The overall effect is of a snowball rolling downhill gathering both pace and size as each debt is cleared.

                      Letters To Creditors - pro-forma letters written by experts to be sent to creditors. The worst thing that can be done with a debt is to ignore it - contacting creditors to make them aware of the situation can be a big help in both practical and psychological terms, and these letters take most of the work out of deciding what should be included and how it should be worded.

                      Bankruptcy - the consequences, costs, mechanisms, and various alternatives are all explored and clearly explained.

                      Bailiffs and Harassment - two separate guides that cover everything from threatening letters and phone calls to dealing with people who turn up on the doorstep. Contrary to popular misconceptions Bailiffs have very few powers, and all legitimate creditors must follow strict guidelines on content, format, and method for making contact with debtors.

                      There are also links to the Motley Fool Guide on how to Get Out of Debt and some of the regular articles on aspects of debt.


                      The true strength of the Board lies in the quality of the people who post there. Included are several employees and volunteers from the Citizens Advice Bureau who specialise in debt advice, at least one Debt Counsellor, several people in the Service Sector side of financial services, a DLA expert, and hundreds of posters who are able to sympathise and empathise. I won't give specific poster names in the review, but will happily provide them to anyone who requests them, although a few minutes scanning the "most recommended" list for DWD will quickly identify the board stalwarts.

                      One other strength is that whilst help, comfort and advice are all freely given, great emphasis is placed on facing up to financial problems and seeking to deal actively with them - ignoring them is the worst thing possible, and the board is called DEALING with Debt.



                      This is far longer than I intended to write, and probably reads more like an advert than a review - the Motley Fool boards are strongly moderated, and "trolls" are given short thrift, but Motley Fool do not control the boards or the quality and content of what is written there by contributors.

                      Please bear in mind that just as on every other on-line discussion board you will have no idea who is behind the various posts, so treat everything written with a degree of caution, and ensure that you seek independent advice if needed.


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                      • More +
                        25.02.2009 00:40
                        Very helpful



                        I hope this helps someone!

                        Credit crunch is probably a phrase that's being woefully overused at the moment. Nevertheless there are probably a lot of people being watchful of what they spend at the moment and trying to make every penny count. Five years ago, or maybe even less, the current economic climate would have been almost devastating for our family. Today, despite my husband losing his job in November, it hasn't been as difficult a time as it might have been. No, we haven't won the lottery and we're not independently wealthy. The difference? Until very recently we were seriously in debt and today while we don't have lot of money, we don't owe anything either. So over the last few years we have learned to live within our means and save money wherever possible.

                        In July 2006 it began to dawn on me that we owed a lot on credit cards and loans. Shockingly, and unbelievably to me now, I didn't even know how much that was. Through a combination of going to university, lending money to family members in trouble, going on holiday and doing up our house we had managed to accumulate debts on a variety of credit cards and a loan or two. Up until then I hadn't considered it a problem; we could meet the repayments easily and everyone borrows money to go on holiday or buy new kitchens... don't they?

                        I probably wouldn't have done anything about it even then if I hadn't stumbled across a forum called "Debt Free Wannabe" on the Money Saving Expert website. I had glanced at the site a couple of times but it didn't really apply to me. I didn't have as much debt as some of the people on that site, I wasn't having trouble meeting repayments and I had a good credit history. I didn't need any advice from that website. But just out of interest, I decided to add up exactly how much we did owe.

                        To say it was a shock was an understatement. Somehow, without realising, although looking back I don't know how it was possible, we owed a huge, overwhelming, staggering amount. I won't post how much here (although I have posted freely on MSE so if you're really curious you could find out!) but it was a LOT! I still had all my statements for the past few months, so I went back and worked out how much I had owed over the last few months and was appalled to realise that although we were paying several hundred pounds a month to credit companies, the debt was hardly reducing at all. The rate we were going we would never, ever be debt free.

                        Suddenly, I realised that I was one of those people from the forum after all. Often this is referred to as a lightbulb moment - similar to a cartoon when a lightbulb pings into action above a character's head to show they've realised something and mine was burning brightly! I realised that we were never going to be in a position to move from our poky little house as we would never be able to get a new mortgage with our level of debt and I suddenly grasped the fact that if we didn't do something soon our whole lives would be spent lining the pockets of the bank. Something had to be done!

                        I went back to MSE and I must have spent several hours reading through people's stories. It was heartening to read personal accounts of others in similar situations, not that I like to revel in other folks' misery but it was nice to know I wasn't the only one who had got into this mess. And really it was my mess; I was the one who lent money to family; I was the one who had reassured my husband that we could afford things; I was in charge of the family finances.

                        Slowly but surely, I began to take in some of the advice on the website. I hate the modern phenomenon of calling every experience a "journey" but this truly felt like the beginning of a journey. I tentatively registered on the website and began my first posts. The regular posters on the site were welcoming and the overwhelming advice was to complete a SOA or Statement of Affairs - basically a complete list of all the incomings and outgoings into our account, but remembering to include less regular bills, such as car insurance or tax, haircuts, Christmas, dental bills and more, alongside the monthly direct debits. It took a while to compile a SOA, but the website very helpfully provided a format so nothing was forgotten, and a while later I posted my SOA and stood back and waited for the criticism, I mean, advice from others who knew better than I did.

                        Now, we're not extravagant people. We don't smoke, rarely drink or go out, don't buy designer outfits, handbags or shoes. But we still did get several suggestions to save money. One piece of advice was to cancel Sky TV and maybe we should have, but all of the family do watch various channels and many of the channels the children watch are the type that can't be found on Freeview. My husband did however phone and explain that we couldn't afford it anymore and we did get six months half price rental, effectively saving £21 a month. At the end of this time we did end up cancelling Sky Sports and Movies, and guess what, we've never missed it!

                        Another problem was that I'm a bit of a magazine junkie and had several subscriptions including a couple for magazines for my profession, which while interesting, I rarely used the ideas from them. They also had to go and again I've never missed them. I do still buy magazines but I've scaled down the quantity - a lot!

                        Next thing to go was gym membership - £23 a month for one or two visits! I hated the gym anyway. Cancelling the membership was a good excuse not to have to go. I much prefer long walks with my family anyway and I don't have to witness lots of sweaty men while I'm doing it.

                        I couldn't bear to completely cancel my charity donations, despite the number of people who advised charity begins at home, but a couple of the monthly donations had crept up to £5 or £10 a month. You know how you get those letters or calls saying "just add a pound or two more"? I'm a soft touch for those. I steeled myself and reduced all the monthly donations to £2 each.

                        Next was food. No I didn't cancel eating. But I did do something completely alien to me. I began to meal plan and shopped according to what we needed rather than just throwing everything I fancied in the trolley, reducing the food bill by around £30 a week. Looking back I don't even know what we were buying - I certainly don't feel like we're missing out now and we eat a lot more home-cooked foods, home made bread and desserts. A happy side effect of poverty is I've learned to cook!

                        Then I cancelled a number of savings plans we had. I realised it was pointless saving at a lower interest rate than we were paying in interest. The savings plans paid out a few thousand pounds, enough to reduce our debt to a slightly less scary, but still massive level.

                        The number of helpful websites that I discovered was amazing too. It was recommended that I kept a spending diary to write down everything we spent over a month. I found this difficult to do with pen and paper but could manage no problem using www.spendingdiary.com where I could write down everything I spent and print a report at the end of the month to show where the money had gone. It was very worrying to see exactly how much I spent on chocolate!

                        Another excellent website was www.whatsthecost.com, a snowballing website. Snowballing is the process of paying off your debts in order of highest interest. Rather than just paying minimum payments, decide how much you can afford to pay each month. Pay the minimum payments on all but the debt with the highest loan and throw all the remaining money at that. When that is paid off, transfer all that remaining payment to the next highest interest rate. Whatsthecost.com estimated that I could knock 18 months off my payments by snowballing and showed exactly which debts to pay first. I must admit, over the months I became a little bit obsessed by this website. If ever I got any extra money I would add it to the snowball calculator to see how much I would affect my debt free day and it was amazing how little bits of extra payments knocked months off how long it would take to get debt free.

                        I began doing surveys on a variety of websites. They didn't pay a lot but they all added up to extra shopping vouchers to use for birthdays or Christmas, or sometimes I would receive cheques which I was very strict about paying straight off a credit card. If I received a cheque for £30, I would pay £30 off a card that same day. It became almost like a challenge!

                        Another new website to me was Quidco, a cashback website that pays commission on purchases. Not that I was making any purchases but they also paid out on free trials and utility switches. In that first couple of weeks I switched bank accounts, credit cards (to a 0% interest card), gas and electricity suppliers and took out car insurance which was due anyway. Overall, I made about £300 and everything was changed to a better deal so I was winning in every way. Once I received the cashback it went straight off the debts.

                        Once all the major changes were in place it was really a case of keeping chipping away. Luckily my debt-busting fire was shining brightly and if ever I flagged there was plenty of moral support from the other Debt Free Wannabes. Over the following months, into years I discovered ebay and sold almost anything that wasn't nailed down, clothes, books, CDs, toys, whatever I could lay my hands on really. Sometimes I didn't make much, sometimes I was surprised by how much an item sold for but I was really strict and used it for extra repayments. It was while ebaying that I realised how much of the stuff we owned was unnecessary, bought because we wanted it, then relegated to a corner or attic and never used, or even glanced at. It helped a lot as whenever I was out shopping I would look at something to buy and immediately imagine ebaying it in a couple of months. I kept up with the cashback and survey sites and kept a close eye on MSE for other money making ideas.

                        It was a fine line between paying off debts and still having a life but we became more inventive! At one time I would have been too embarrassed to use a voucher but they became my friend in the supermarket. Plus I made full use of vouchers for free or reduced entry to theme parks. We visited museums and parks that were free to enter. If we visited the cinema in school holidays it was on a Wednesday to take advantage of Orange Wednesdays, and smuggling in a bag of snacks and drinks. We didn't go on holiday abroad as we normally would and took advantage of The Sun newspaper's £9.50 weekends instead. My husband and I dined out regularly as mystery shoppers - free meals and a small payment for doing it! Christmas presents and birthday presents were bought in the sales or using survey vouchers. We bought cheap hampers and made sweetie hampers, or pamper hampers for gifts using free samples or travel sized mini bottles. They were surprisingly well received; my Mum even hinted for another one this year.

                        Slowly but surely, the debt whittled down. The passing of each thousand mark was a cause for celebration and by the time I fell pregnant in May 2007 I was confident of surviving maternity leave on a much reduced pay. Even our baby was provided for on a budget. I got a baby sling, baby bath and bouncy chair from Freecycle and my friend who had a baby a few months old passed on a moses basket and many, many clothes. Most of my maternity clothes came from eBay and I wore my old stretchy tracksuit bottoms almost until they fell to bits. I breastfed my baby exclusively until he was six months (and I'm still feeding now at 12 months old), which was actually a lifestyle choice but had the handy bonus of being free.

                        Luckily for us, by the time baby was born in January 2008, our debts were no more. I won't even begin to pretend it was easy At times it was embarrassing, frustrating, annoying and depressing but we kept going with the support of the MSErs, many of who are also Dooyoo-ers, and the vision of life without having to pay creditors each month. I'm not sure what I expected from my debt-free-day, a lightning clap, heavenly music, a big medal, perhaps, but in the end it was a bit of an anti-climax but a huge relief. I think I thought we would be rich afterwards with all the extra money we would have. Well, life doesn't work like that, does it? After nine months maternity leave, we decided I would only go back to work three days a week, then two months later my husband was made redundant. He has found some work, but only on an ad hoc basis, usually three days a week, which has really worked for the best as we may have reduced our income by half but we have a lot more family time together and as we've learned to be more frugal we don't miss spending on anything. Luckily our children are fairly content with what they have and they don't nag for expensive clothes or toys. Despite only earning one salary between us we're still managing at the moment to pay the bills and save a little amount each month and I'm still doing the surveys, and now Dooyoo, to pay for the little extras.

                        I realise that we have been lucky to have come to our lightbulb moment just at the right time and there may be people reading who are in just as bad or possibly worse situations than we were. If you're having serious problems and are unable to pay bills, don't hide from your problems as they won't go away. There are many sites that promise to help with your debts but many are just out to make money for themselves. I would recommend speaking to www.cccs.co.uk or www.payplan.com if you're struggling to pay. I don't have any personal experience of these companies but I understand they give help and advice for free. Additionally, the Citizen's Advice Bureau can also provide debt advice. It wouldn't hurt to take a peek at the Debt Free Wannabe board either, even if you don't have the confidence to post to begin with, it's heartening to know that you're not alone and I can practically guarantee no-one will judge you, no matter what the level of debt. Even now, I still post there and count several of the regular posters as friends.

                        It can be a long walk, but every journey starts with that first step!


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                          02.02.2009 15:40
                          Very helpful



                          Its rewarding to know that you are doing something about it.

                          Firstly let me give you some information about us. Me and my husband are 24, and between us have £20k of debt on credit cards and loans. Now I can account for where some of the debt came from, such as £2k for our wedding, £5k on my car, £3k on my husbands car, £1k for furnishing our first home, but I cannot account for the rest. I believe that we just got carried away with spending on credit cards. We wouldn't think twice about spending on the credit cards when we went into town, and more than once we would max out a card to its limit. My lightbulb moment was about 6 months ago, when we decided that in 2011 we would go out to Malaysia to live with my dad for two years. To do this, we need to be debt free. So, I did the first thing which anybody that wants to get out of debt should do - draw up a list of how much you owe to who. This was a bit scary as I only thought we owed about £20k, but it turned out we owed £26k! Eeek! I put all the numbers on to a spreadsheet, and have a column for each month where I deduct the payment made off each debt for that month and then show the remaining balance on that debt. At the bottom of each month I have a total that shows my total debt. By doing it this way you can see at a glance when all your debts will be paid off at the current repayment amounts. This can be inspiring, seeing that date when you will be debt-free! The next step to do is to draw up a budget for each month. List all your income, and EVERY item of expenditure. Be honest - put in those takeaways and cds. It may be shocking to see how much you frittle away each month. Cut out anything that's not necessary, and there's a easy way to deem whats "necessary" - to determine if it's a NEED or a WANT. You don't need a takeaway, you want one, so that has to go I'm afraid. That new cd you've got your eye on? Again, you don't need it. Can you borrow it from a friend? Or rent it from the library? If you really want to pay off your debt you have to be disciplined. Add up all the items from the past month or two that you have not strictly needed, and add this amount to your monthly payments on your debt spreadsheet. Now see how fast that debt could go down!
                          Cut up those credit cards, but keep one for an emergency. And NOT in your wallet! Leave it in a drawer at home, or give it to a family member for safe keeping who will only give it to you to use if the reason is justified. OR - freeze it in a block of ice in the freezer!
                          Look at every item of your expenditure: car expenditure, broadband, mobile, food shopping, and determine if you are getting it at the absolute best price possible. If not - switch!
                          It's a struggle, but it will be worth it. My debt free date is currently at July 2010. Roll on!


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                            22.12.2008 21:46
                            Very helpful



                            5 Stars for the effort needed!

                            I wish I could be writing this and telling you all about how I cleared my debt in six months.

                            Tragically that is not where I am writing this from.

                            Bit of background for you, 24 years old, married and in debt, £18k of it to be exact.
                            This however is down from £27k in a year so really we're not doing too badly.

                            What advice can I give to those who are in debt.
                            Face it numero uno. Its not going away, you can clamp your eyes shut, scream at the mail-man, spend on your credit card till the cows come home but it will still be there, like a mangy rabid dog at your heels.
                            The sooner you face it, and say "Hello Debt" the sooner you can say "Debt you can kiss my ass"...

                            Add it all up. If you dont know what you owe where, then call the companies and ask them for a current account balance.
                            I've been really lucky to face up to our debts before the phone calls started and any debt recovery companies came knocking.
                            It is so much easier to discuss paymnt options with your credit card/loan providers than the middle man.

                            Set up a direct debit to each and every one of them for the minimum payment and arrange for this to leave your account at least 3 working days before the amount is due. If you contact your credit card providers to arrange this, they will always call for it before your due date. Meaning you dont then pay any late charges.

                            Secondly visit a site called whatsthecost.com. This has a fantastic "snowball calculator" into which you add all your creditors, amounts owed, APR percentages and minimum payment amount.
                            Add in how much you can afford to use to service your debts and this handy little thing will work out for you which debts to overpay to, and in which order to make sure you pay as little interest as possible!
                            It puts it into a calendar type form and if you save the account you can use it to track your progress, by adding your payment amounts to the creditors each month.
                            Seeing the progress can really spur you on!

                            Secondly and I cannot recommend this site without literally wetting myself, is moneysavingexpert. This site has so much information regarding credit cards, loans, debt payment plans.

                            Thirdly budgets......
                            Not the type that come in a battered little brief case carried once by the Fat Brown himself. Instead I mean literally what goes in and what comes out.
                            Look through your bank statements, as hard as it is and be honest with yourself. If you are spending £20 a week on takeaways write it down. Identify areas of weakness and aim for improvement. Dont try to live in beans for a week because you'll only crash and burn and end up going crazy!
                            Try once a fortnight instead... and then once a month.

                            Earn extra income.
                            There are lots of sites out there just begging to give you money for very little. Moneyback websites for general shopping are great, try moneybackmadness or quidco, writing reviews on all those things you bought on your credit card can earn you something back try ciao.co.uk.... and of course dooyoo!

                            Grocery spends.
                            Put simply spend less, make more.
                            Whats the point in buying a shepards pie when you can make either a double size portion for the same as you spend on one ready made, or spend less making your own single size.
                            Eat more vegetables, they are cheaper, more filling and better for you.
                            Lunches at work, are you a victim of M&S food hall, or the Boots Meal Deal? No more I tell you, make your own sandwich, buy tins of soup to take it, make pasta at home. My husband used to spend £5+ a day on food, and now spends less than £10 for an entire week!

                            Savings are everywhere.
                            Make sure you have the best deal on everything, dont be afraid to phone your providers and ask for better deals. They want to make sure your money stays with them, rather than taking it somewhere else!
                            Phones, broadband, cable tv, insurance are all there for you to make savings on.

                            And when you've made those savings, even if its £1 a month, is extra you can use to pay your debt.....

                            Debt itself is not nice. Ive had sleepless nights, had to miss out on social events, been through an emotional rollercoaster, but you know what? I would not change it for the world.

                            The lessons I have learnt will stand me in good stead for the rest of my life, and will mean that once this albatross is released from the chain around my neck, all those beautiful pounds that I work hard to earn, will be mine, all mine.....

                            Whatever will I spend it on!?


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                              08.09.2008 14:23
                              Very helpful



                              how do you beat debt?

                              Thanks to everyone who has nominated this review. It means a lot and I will see what will happens.

                              Debt - perhaps an easy thing to get into, but ever so hard to get out of. I will tell my story. I know I'm incredibly lucky, and this is not written to gloat or rub peoples nose in it. It's just the story of what I went through, how I'm coping with it and you may pick some advice up along the way.

                              Myself and my now husband got our first council flat in March 2000. We were both students and both worked part time at night to keep money up. Money was not too bad at that time, since we got a rent reduction for being students and all was ok. We didn't have much, but it was liveable. Unfortunately the temptation came to apply for credit cards, catalogues and we even got involved with Provident personal loans as well.

                              We kind of muddled along for a few years. Unfortunately the place we both worked at night, a local Chip Shop shut down. We went to work that night, and at the end of the night the owner said he was shutting down as of there and then!

                              I done the sensible thing and contacted my creditors the next day, told them and they were great at saying we could pay them £5 a month and so on for a set time of 3 months, then the situation would be reviewed. So we stuck to the agreement, and things were ok. Strangely enough we were nearly better off this way, although we only had our student money, since the debts were reduced it averaged itself out. Unfortunalty when the 3 months were up, we were so used to paying a minimum that we ignored the letters when they started coming. By now we were both back working in the Chip Shop, as new owners had took it over and they knew we'd worked there before. But still we decided we didn't want to pay for what we run up and still ignored the post and phone calls.

                              Fast forward to August 2004 and my grandparents popped up and said, "Do you want to buy our house" "Eh, ok we said" and 4 and a half weeks later we had a house, complete with mortgage! Sound crazy, but we had bumped our debts away, and although our mortgage was pretty bad due to our credit problems we were now sensible homeowners, and what can homeowners get? That's right, secured loans! By this time we had proper jobs though. My husband started working for the local council in 2003 and I had been working as an assistant manager since October 2002. Money was on the up, but then again so were bills. We got married in May 2005, so had a wedding to pay for as well.

                              Around the time of the wedding we applied for a £9000 secured loan, got it and my Visa card, which had a limit of £2000 suddenly was approved for £9000 as well. "We're rich" We thought and spent like there was no tomorrow. I shudder to think where all that money went. I can recall our 42" TV, which was £1800, £2700 for new windows and that is all I can think where the money went. Yes very careless, but I can't change that unfortunately.

                              I changed jobs in January 2006. We had a new boss by then, and she didn't like me much. I used to work 37 hours a week, but my contact was for 22 hours. I had been promoted by then, that's why I got more hours, but my old boss promoted me and the new one decided she only wanted me for 22 hours. The more unhappy I was there, the more I spend to cheer myself up and with having a less income this was heading for disaster. Anyway with a mortgage and high bills to pay I couldn't survive on 22 hours pay a week. So I applied for a new job and on Christmas Eve 2005 my new work contract popped through the door. A Christmas I would always remember. Things were finally sorting themselves out.

                              The new company I went to work for is great and I'm still there now. I was on a lower wage at the new company, but worked for 30 hours. I was told I could work overtime once I'd finished my trial period, and as of April 2006 I was working a minimum of 7 hours a week overtime at time and a half! Things were getting better and better.

                              Money still wasn't that good, and debts were still bad. Our house was an old house and heating and electric bills were horrendous. No change of £120 a month for the gas and electric. So in October 2006 we applied for a £20,000 loan. With this money we paid off the existing £9000 loan, which was sitting at £12,000 to pay it off, we owed £4,000 to Provident, I had 3 credit cards - not including my £9000 Visa, so I paid the cards off and we tidied up a few bits and pieces. So we just had the one bill to pay. Unfortunately our outgoings for mortgage and the loan was £1200 a month, and we maybe had £1900 coming in. £700 sound like a lot to have spare, but my husband had a car loan which was £286 a month, so we were on the breadline.

                              Money and bills were still not that great, but we were surviving, and since our credit wasn't that great we couldn't even get approved for Credit Cards or Catalogues anyway, so that helped us be on the straight and narrow.

                              Fast forward to December 2007. We found ourselves having a visitor in the house. Either a rat or a Mouse. So what has this got to do with debt? Well we had a furry visitor in the house a few years ago, a tiny mouse that we caught in a trap. It took time for us to catch as although it couldn't get into the house it was able to run all the way up and down the walls of the house and my husband and myself could hear this scratching above our heads at 2am and we were unable to sleep because of this. We survived that incident, but when the new visitor appeared in December 2007 my husband declared he could not stay in the house no longer and wanted to sell up. It would have cost thousands to try and seal our old house to try and stop vermin coming in. It's not that we stayed in a bad area, but it was well known that a derelict building near us had rats and mice, but the council didn't care about it.

                              So we sold up. The house was advertised on the 7th of January, our first viewer was on the 8th and they were the ones who ended up buying the house. We had always thought that since my grandparents gave us the house about £10,000 cheaper that if we ever had the money we would have liked to pay them it back, but sadly they died, so it was too little too late. We had to pay our mortgage company £85,000, but got £148,000 for the sale of our old house. So the remainder of the money we had left cleared our debts. We did have a huge struggle trying to get a new mortgage, as the credit crunch had hit and our credit file was less than perfect, so our new mortgage lender insisted we pay a 20% deposit. The house we were buying we could afford that deposit and have £2,000 left over. Our plan was to pay the final bill off, which was my husbands car loan, but because we had to pay a higher deposit than what we bargained, we sunk the £2,000 into the car and with the minimum monthly payments the car will be finished next October.

                              So how is money now? Well my husband has had his standard pay rises, and myself? I'm on cloud nine. Since I started with my work in 2006 I got a £1,000 rise in July 2006, another £1,000 rise in July 2007 and a £1,080 this July. I was still on the same 30 hour contract, but as of the 26th of September 2008 I will be going to 37.5 per week contract, which is giving me another £3,200 a year on top of my wages. I can still work overtime as well if I want! I still have 1 Capital One credit card, with £700 still to pay, but I'm paying more than the minimum and not using the card either! We pay our bills by direct debit and you know how I said our gas and electric was £120 per month in our old house? It's not even £40 per month here in the new house! We don't have to pay for Sky TV, Broadband, Line rental or phone calls - perks of my job. Can you guess who my employer is? That is a saving in itself.

                              Although our debts are now in control, I am not complacent, as I know we could get ourselves into trouble just as easily again we've not had a holiday for the last few years because of debt and it's tempting to chuck one on the visa, but good things come to those who wait. Anyway how much more satisfying will it be to know you paid for it yourself and not had to pay double because of interest charges?

                              My debt advice is simple. I know I'm lucky and so many people won't have had all the luck that I've had, but ignoring it really does make it worse. If you don't want to phone the company because you're ashamed, or feel they will laugh at your payment proposal, most letters have a postal address, e-mail address - even one companies accepted text messages, how modern is that?

                              I've found that I'm so much more conscious of my money as well. If there is any offers on something I need or use I will stock up a bit. Why pay full price for toilet roll or that when you can buy a few on buy one get one free? Since the recession talk these days, all supermarkets are full of great offers, mostly half price items or things for £1. With Christmas looming I've stocked up on men's body sprays and so on, so I've made sets of shower gel, body spray and deodorant for under £3 and it's Gillette products.

                              Hope I've not bored you. This has come from the heart and hope that as many people will read this as possible. All the Dooyoo money will be going to my credit card, so reads equal more money, but it just be good for people to read this and think, "I can do it and I can beat this" because there is no feeling like it.

                              Thanks for the read and rate. God bless and please feel free to leave your comments.



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                                01.08.2008 12:52
                                Very helpful



                                You don't need to feel you are in this alone.

                                Let me introduce myself. My name's Kitschkitty and I'm a debtor.

                                I've previously endured sleepless nights, I've heaped unopened bills and letters in drawers and I've ignored answering the phone and the door. Then, in an ironic twist of fate, I started working for a debt advice company and I finally realized I needed to face up to my Everest of unpaid bills.

                                And so the first step on my journey to becoming debt free began. Over on Moneysavingexpert.com, they call it your lightbulb moment. Just with any problem, the hardest bit is admitting that there is one and taking steps to resolve the situation.

                                I won't go into the ins and outs of how I ended up in debt. In fact, there isn't one sole cause I could put my finger on. But I am, and it is my responsibility to sort it out. I'm writing this from a personal point of view since I no longer work in debt advice. If you re in debt and are reading this, I hope at the very least you will realise that you're not alone. I just want to point out that my debts are all unsecured. If you are struggling to pay your mortgage or other secured debts, please seek professional advice sooner rather than later.

                                The first step for me was to stop burying my head in the sand. I went through all the unopened letters that were hidden away in various drawers and cupboards and opened them all up. I then sorted them into piles for each separate creditor. I'm not an expert on Excel, but I set up a spreadsheet which listed the date and a list of each creditor and the balance owing with a scary total at the bottom. Now I was fired up and motivated, I needed a plan of attack.

                                The next step was to look at my income and expenditure and come up with a realistic monthly budget. Now I know this review isn't about Moneysavingexpert.com but I'd recommend looking at their budget sheet on the Debt Free Wannabe forum. This is particularly useful as it includes all the little things that you can easily forget when doing it yourself. Obviously rent and utilities are essential but don't forget to include allowances for your TV licence and road tax. Once you have your incomings and outgoings in front of you in black and white, you need to go through them carefully and see where you can tighten your belt to save money. For me this has included cancelling cable TV and my landline. My mobile is now on pay as you go. If the top up runs out sooner than expected, I don't make calls. Fortunately, my friends are very supportive of me and sympathetic of my money situation so they're used to me saying 'Sorry, I've got no credit.' I couldn't survive without the internet so I've kept that and it's easy for me to send an email or a free SMS to keep in touch with friends without breaking the bank.

                                Once you've come up with a realistic budget that you know you can live off, you need to divide your monthly surplus between your creditors. You can then write to them all including a copy of your monthly expenditure with your offer of payment. There are template letters available online through sites such as nationaldebtline.co.uk. If you are really worried about this process, you can also get free help from debt charities including Payplan. They will contact your creditors on your behalf to arrange a payment plan and you make one payment to them each week or month which is then distributed amongst all your creditors.

                                Once your monthly payments have been agreed, you can go back to your spreadsheet and enter the decreasing balances each month. I find this really motivates me to cut back my spending that little bit more and try and earn a little bit extra. You'll find that once you're in the right frame of mind, it is much easier to part with items on Ebay in the hope of clearing your debts a little bit quicker! I've also discovered I'm spending a lot less money and I rarely make impulse purchases. I always ask myself if I need an item before I buy it and more often than not, I leave shops with my money safe in my purse and not their tills!

                                It has helped me so much having friends who I can talk to about my debt problems. They haven't judged me and some have even shared their own debt stories with me. Even the people who used to laugh at my bargain hunting ways are being to change when they hear the stories of freebies I've got or money I've earned online! If you don't feel you can talk to your friends or family about it, then try joining the debt free wannabe forum over at Moneysavingexpert.com where you'll find plenty of people to offer you advice and support through your journey.

                                I still have a long way to go but I do feel in control of my situation now. If anyone is reading this and has their 'lightbulb moment' I wish you all the luck in the world.

                                Here are some websites that may help:



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                                  26.03.2008 12:19
                                  Very helpful



                                  There are free debt advisory services out there so don't pay for advice.

                                  The first thing to do if you have debt problems is to gather everything together and get a clear picture of the problem. Dig out credit card bills, utility bills, bank statements, threatening letters, and everything that comes under the heading of finances. Once you have them all on the table in front of you, settle down to make some sense of it all.

                                  Take a sheet of paper and write down all your debts on one side of it. On the other write down what you are currently paying out per month. Take everything into account including household living expenses, gas, electric, insurance, mortgage, etc. Don't forget to add on all those extras like nights out, gym subscription, and all the extras you pay for each month.

                                  Now you know exactly how much you are spending each month.

                                  Then calculate your monthly income. Include everything including allowances, tax credits, salary, and everything else.

                                  If what you are spending exceeds what you are bringing in, you need to reassess things. It's as simple as that.

                                  Let's assume that you have done that bit and discovered that there is no way your income can cover your outgoings. This means that your debt problem will get worse if you ignore it.

                                  Separate your debts into priority debts, and others. Priority debts are utility bills and your council tax bill. The others have to be paid but you can negotiate on them.

                                  Take a fresh sheet of paper and write down all your monthly expenses including priority debts. Add these up. The money you have left after this is what you have to pay your debts with.

                                  Add up the debts (non priority ones) , then work out how much to offer each of your creditors. For example , if you owe £3,000 in total and you have £30 per month left to pay them, then you offer your creditors £10 per thousand pounds that you owe. This is called apportioning fairly.

                                  Write to each creditor (addresses on the bills) and give them a list of your household expenses and income. Show them that you only have £10 per month ( for example) to offer them and ask them to accept this until your circumstances change. Don't forget to ask them to stop any interest on the account.

                                  If you have nothing left to pay them with, then tell them so and offer them a token £1 until you can pay more.

                                  You will get letters back within a couple of weeks and most creditors will agree but if you find one who won't, don't worry, just state your request again, pointing out that others have already accepted. Don't let them push you into paying more, or you won't be able to keep up the payments.

                                  This is basically how you start to sort out a debt problem. It won't make it go away but it is a way of tackling it and should ease the worry.

                                  If you need help doing this you can get free help from Citizen's Advice Bureau, National Debt Line and others. These are free services. Don't pay for advice, or be persuaded to take out loans to cover the debt. You don't need to.

                                  Both of these organisations can help:



                                  Consumer Action Group has a forum which deals with debt and can help you write letters, find out the law and get support from others battling with the same problems. It's free to join and exchanging ideas with others in the same position with stop you feeling so isolated by it all. Take control and you will feel better.

                                  Debt can get you down and it can make you depressed, so get advice and support, don't just put up with it.



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