Walk this way!

Hello Dear Reader,

As I promised you this morning, here is my reply to your email. Thanks for agreeing to me answering on here and allowing this 'quandry' to be thought about in the open. I'll let that phrase 'in the open' rest with you a while and let you think about it.

Here without any details of who or where are the issues: decent job, a life style to maintain and most of it is for show and all funded by credit that you will pay later. It's now amassed to thousands . One of the partnership feels duty bound to maintain this lifestyle whilst you, who wrote to me are worried and want a different way. The words that struck a chord with me and will with many who read this is that you are 'at your wits end with worry'. So many people in debt lose sleep, their health suffers and their children are affected by the worry of their parents. Debt can and does cause severe mental health problems which can lead to more debt and more worry. It can be a downward spiral but here's the positive thing. You've asked for help and here's my public promise to you.......I'm with you every step of the way!

Your partner is still in the earn it, spend more that they earn and keep spending phase of this issue and you want advice. Well here it is! If he can't help himself, if he's spiraling ever downwards then you are going to have to use shock tactics and take control of the situation. You know how much the debt is so I assume from that that you are aware of: overdrafts, credit cards, car payments and loans. You must also be aware of monthly amounts and payment schedules. If not then, by any means, find out. Get all of the facts and figures and sorry to mention this, but the figure you think is the final amount may be smaller than you think. 

You are going to need to find out a set of figures: total monies coming in and total monies going out. You will need to track all spending for a month: fuel, car costs, running costs, all direct debits and keep every receipt. Where do you spend money? Do you eat takeaways? eat in restaurants? buy clothes? go on day trips? weekends away? have club memberships? wine club memberships? occasional spending.......those trips to Tesco for a top up soon stack up? You need to get a picture of who spends what, when and what are you buying?

The big part of this that most people avoid is confrontation, challenge and change and you are both going to have to face up to all of these. If you've never had a row about money before, then you are just about to. There will be upset, crying, door slamming and emotional purging. One of you is having an affair with spending and the other is being cheated on! For some people this is a deal breaker but a real, strong and truly loving relationship will survive this. If one of you has the financial control, spends everything and leaves the partner worrying about this then you've got one heck of a domestic on your hands. All you can do is put on your big girl's knickers and your Wonder woman cape and dig in for a long slog.

The good news! Your debts are half your annual income. Ours were two thirds of our joint annual income (at the time, we earn less now) and with total determination and short term deprivation we made our way out of debt in less than two years. If you pledge one third of your after tax income per month to debt repayment, you can be out of debt in two years. Any one can suffer any lifestyle change for such a short space of time.

Now here's the only tough bit if one of you is living a lie and that big fat smelly lie is trying to keep up with the Jones when you can't afford it. Be honest!!! You can turn down invites for a couple of years because you are trying to improve your family's finances. That's all you need to say. Yes, some people will be numpties and challenge that but you don't have to grace them with any sort of answer. Let them think what they like! We told people we were paying off debts and were not ashamed to say we are improving our family finances. If people didn't like it then they can lump it! We didn't go anywhere or do anything until we were debt free and now we are, we still mostly turn down invites as we still don't have money to throw away. If I can't turn up to your wedding in my ordinary clothes then you don't want the real me so what am I going for? 

Yes, people, usually in debt themselves, will do the willy waving, look at my: car (on finance), holiday (on the credit card), flashy kitchen (on a bank loan) and try and impress you. If you are genuine friends, then carry on being genuine friends but start to weed out the chaff of the fakers, piss takers and hangers on and rid yourselves not only of debt but the dusty collection of people with bad habits who are more interested in what you have instead of a genuine friendship where people can be honest with each other. Think of it this way, if you'd given up alcohol, would you still stand in a boozy pub with a bunch of drunks whilst you were sipping on barley water? It's just not compatible. You may need to move on and keep on moving.

So lovvie, here is the summary. Get the facts - what do you owe? what are the monthly repayments? what are you spending money on? The tough bit, you've got to woman up! He's got his head up his **** and you're worried sick. It's time for you to have equal say and if you want the debts gone then you've really go to show him how it can be done by looking at what you can stop spending money on to free up money to pay off debts. Remember the figure, one third of your after tax income needs to go on debt repayment a month.

1. Build up an emergency fund first - we worked on £500 in the bank that was for real emergencies! Christmas is not an emergency, it's an annual occurrence!!

2. List all your debts from smallest to largest.

3. Keep paying the minimum payment on all of them.

4. Take one third of your after tax income and throw it all the smallest debt first.

5. When that is all gone, take all the money you were paying on that debt and move it to the next and keep paying the minimum payment on that debt too (minimum payment + third of after tax income).

6. By my calculations, you should have all your debts gone in two years! If you have a good credit score then use interest free credit cards to move debts into and pay off debt quicker. Make sure you pay off the balance before the free credit is up. Use price comparison sites to get the best deals on this such as Go compare. 

With the two thirds of your after tax income break that down into:

1. Mortgage.
2. Utilities - switch and save - get the best deals
3. Insurances - use price comparison site and also cashback sites to get the best deals plus cashback.
4. Food - switch down, go down a brand, use generic, shop in the local market, Lidl, Aldi and buy supermarket basic. Home cook, bulk cook, menu plan and set a budget each week and stick to it.
5. Transport to work costs - you've got to keep your jobs. Find a price for servicing and start setting aside a monthly amount to cover the cost when it's due. Cost £300 so you need to set aside £25 a month into an account to pay for this. if your bus fare, train pass is a regular amount to commute to work then this is at the top of your priorities. 
6. Clothes, your child is growing so clothe him/ her - there are good clothes for children in Primark, Tesco, Asda and you don't need to spend much. You and your husband are not growing so make so with what you have! Sell excess clothes on ebay and keep clothes in a Paypal account to use for vitals such as new work shoes, bras, boxers or tights. 
7. Sell everything you don't need - use the money to pay off debts.
8. Only buy birthday and Christmas presents for children, the adults can get by with a token....who doesn't love a shower gel or bar of chocolate! If they need impressing then ask yourselves about the kind of shallow plonkers you hang round with! 
9. Set aside 5% from the two thirds of your after tax income for saving, this will pay for school trips, hair cuts and real necessities. Make up is not a necessity..........Mua in Superdrug or Aldi's make up if it is vital to you but get used to buying 98% less than you every used to. 
10. Money left at the end of the month? Move it one month into a savings account and one month as a debt over payment. 


Now here's the most important one! Earn extra money!!! All of that money will go to an ongoing emergency fund that needs topping up. If the washing machine breaks down, the car needs new tyres, your only shoes have a split in the sole, then you need to turn to savings as you can not add one penny to the debts. This is the first phase of the new way of living, you only spend real money. Your own, that you've earned that month or saved from previous months. This amount will be meagre to some but it's the realistic amount of money that you have and be proud of it. You've earned it, it's yours. It will be more than some but less than others. It will have to be enough as now, that's all there is!

Here's the target date, in May 2017, you will be debt free! You will have a disposable income of one third of your after tax salary per month. 

It is possible.

Now gird your loins, you've got a blinkered, stubborn, resistant to change man to nudge firmly in the right direction. Be loving, be charming, be kind but be firm! You will need to love each other more than ever over the next two years and at times, you both will be all you have to keep yourselves going. 

Keep in touch lovvie and good luck.

Until tomorrow,

Love Froogs xxxxx