any help getting out of debt??

Question

i have got an old debt from a fruit machine addiction.. £9000.! i have kicked the addiction 3 years ago but now i cant seem to get rid of the debt. My loan finishes in a year so not to worried bout that but i have 2 credit cards which i dont use anymore but can only afford to pay just above the minimum. My credits not that great so cant change to interest free cards or anything that gets recommended and i dont want another loan ! any advise??

Answer 1

You MIGHT get a lot of strange advice from people but the simplest and BEST answer is to keep doing what you're doing or change your lifestyle.

It's true that hindsight is 20/20. We get ourselves into extreme debt in a VERY short amount of time but what we don't see then is that it will take us a very LONG time to get out of it.

Now, you could get yourself some extra work if you want to speed up the process a little, but most people find that when they figure out their debt repayment plan that the extra money from the second job doesn't save them much time. Might not be worth the stress and effort.

Now, changing how you SPEND your money otherwise is usually the thing to really look at (the lifestyle change).

Did you know that if you buy just two Starbucks drinks a week for a year you've spent $500??!! Sure, it's just $5 when you buy it, but you have to think LONG term about these things.

Take a look at your spending and figure it out on a YEARLY basis. That $500 per year at Starbucks put towards debt instead could make a $3000 debt paid off in 1/3 LESS time saving you a TON of nasty interest.

One final note: DO NOT go the bankruptcy route and AVOID debt consolidation agencies. They really will end up hurting you in the long run.

Good luck! You can do it, believe me!!! Please feel free to email me if you'd like my Debt Payment schedule spreadsheet! It's helped me out a LOT!!

Answer 2

If you have a loan that finishes in a year perhaps the loan company could help to cover the credit card balances. I know it is not ideal, but at least the interest rate would be a hell of a lot lower. It is too easy for people to say 'tough pay it off', there is nothing more disheartening than when your debt never seems to reduce. Have a good look at all your other finances too and try to see if there is anything at all you can reduce your payments on, Sky/cable TV for instance, are you with the cheapest energy provider? can you cut your food bills by cooking and freezing, that sort of thing, it doesn't sound like much, but trust me it soon adds up. I have been in your position due to a partner that gambled and we are just getting to the end of it, so stick at it and you will get there!!

Answer 3

If you cant change to an interest free card then I would recommend you get another loan because the interest would be cheaper. If you are paying just over the minimum and you are not using the card then the debt will eventually reduce - but very slowly.

I would get a loan, pay off both cards and spend the money you were paying to the credit card companies on the loan. It will reduce much quicker than just paying the credit cards.

Answer 4

Be proud of yourself that you have kicked the habit. If I was you I would pay off the credit card first before the loan as they are the most expensive form of borrowing. Ask relatives for a loan if you can. Equally don't buy any presents this year and say you want none. If you don'twant to seem mean suggest a lottery where everyone buys just one present instead many small items of tat. Email people instead of buying expensive cards- u r helping the environment too! Do you work? If so can you get overtime?Credit unions are great and cheap ways of borrowing. Forget your scruples as long as it goes to paying off the loan. Quit smoking if you do and quit/cut down on the Pub or eating out. Write down what youspend everyday and see where u can make savings. Again be proud of yourself because you have succeeded in curing an addiction where many,many have failed.

Answer 5

You need to generate more income either with another job or/and a generous raise at your current employment. I see many responses of shopping around for a better rate or consolidating. However, those solutions are just a temporary fix. It does not pay your debt off. If your credit is not the best, chances are you are not going to get a better rate if anything at all.

You need to earn more if you want to pay more. I had to get another job and hated it at first. However, after paying off $15000 in credit and loan debt for 2006, I am happy!

THIS IS A COMMENT FOR THE COMMENT BELOW
The reason you can get a credit card after bankruptcy is because the credit companies know you cannot file again. In addition, they are betting you are desperate in re-establishing your credit and are willing to pay a higher interest rate along with paying processing fees.

Bankruptcy is one of the worst things you can do to your credit. Only do this if it is absolutely necessary.

Answer 6

Cut up the credit cards so you won't be tempted to use them. Pay the minimum on the highest balance Credit card. Either work overtime or get a second job. Put all extra money on one card. Then when its gone start working on the other card. Oh and remember to set up a small emergency fund, so that if some emergency(car breaks down, toilet starts leaking) you will have some cash to pay for it- since you cut up your cards

Answer 7

Pay off the card with the smallest balance first. Make the minimums on the other(s.) When that is paid off, take the monthly payment you were paying and apply it in total to the other card.

When my husband and I split we both took 22K in debt with us. I have reduced mine to 13K using this system, he is still at 20K by paying slightly above the minumum on each card each month. (and he makes more money then I do)

You can also negotiate with the cc company you are paying more then the minimum to to give you a lower interest rate.

Answer 8

If your credit isn't that great right now, you could try a debt settlement company. We used Debt XS, and settled all our credit cards in 3 years for about 60%. Now our credit score is going up every month. They settle your cards for less then the balance due and it's better for your credit score then bankruptcy.

Answer 9

You can start a home business with Forever Living Products who are looking for more people. Their recruitment site is www.efi-international.com

They are a $2 billion company backed by Dti and Office of fair trading and you can work at home doing it. Typically people get £1200 per month after 5 months with no investment required and you could pay of your debts by building up a sceond income with them, and having this as extar income for rest of life.

I highly recommend them

Answer 10

The Money Advice Trust (MAT) produce a very good self help booklet with various and comprehensive suggestions for dealing with debt and negotiating with creditors. The booklet is available from your nearest Citizens Advice Bureau or direct from MAT @ www.mat.org.uk. Good luck.