Debt! (and not the kind Gordon Brown is responsible for)

WYOO personal debt?

Do you have any debt? What form does it take?
Do you count student loans as debt?
Do you have 'personal' loans that need repaying, ie, loans from parents/friends/etc, and not banks?
WYOO people who get themselves into lots of debt? Is it greed and bad money management, or is a lot of it 'honest' debt?
Is debt a fact of life, or should we all learn to just live (and in some situations, die) without it?

I have no credit cards or loans, my only debt is my mortgage..
Personally i have NO sympathy for people who get themselves into debt. They should have thought longer about it before they pulled their card out to buy that emergency dress.....there is no personal responsibility anymore and its too easy to blame the banks for lending it....
I get offered a credit card at least once a week - doesn't mean I have to take them up on it....

GGGRRRHHH gets me mad

I agree with Northern soul. We have a mortgage WELL within our means.

We have 0% credit card which we owe on but if we were called in on it, we have enough in our savings to pay it off.

If we can't afford it , we do without.

I have a mortgage and no other debt. I am more of a save for it or go without person rather than a buy it on the credit card. We live a comfortable enough lifestyle.
We are having our first holiday next month and I can't wait, last year we had a long weekend away from home but not a proper holiday, this year I have changed the shopping etc to ensure there is enough money for a holiday. I don't at out often (last friday was the first time this year) take out dinners are a very rare thing (maybe 3 times this year).
I do like to live within my means, it has been hard, very hard, but I now know what we can and can't have and can now accept this (I had a VERY hard time adjusting to paying nursery fees with what had previously been shopping money)

jx

Those of you currently living debt free and within your means, what would you do if you lost your main source of income? Lets assume downsizing is not possible, and you are already living at a level where everything gets paid and there's some money left over at the end of the month, but you don't have tons to spare. How would you cope with the loss of that income?

I ask because up until last year, I was rabidly anti-debt. I had vowed never to get a credit card, hated the idea of the things, and thought anyone who had one and didn't pay off the entire balance every month was greedy and money-grabbing and materialistic. If I wanted something I couldn't afford, I did without or saved for it. I always lived within my means and if that meant doing without, that was ok. Until I started university, I didn't even have an overdraft. I never had a contract phone, didnt buy games consoles or new phones every six months or flash status-symbol accessories. I was quite happy to not go out with my mates if I didnt have the money, it didnt bother me. We lived very very frugally so that we could have a bit saved up and pay all our bills and keep ourselves going.

Then last year, M lost his job, and was out of work from July until February. We were draining every bit of cash available to us just to pay rent and bills and food. We couldn't move to a cheaper flat because we wouldn't pass a reference check, and it got to the point in November when we had £15 left of my overdraft to last us about 6 weeks. So we got a credit card, because it was the only way we could afford absolute basic essentials, like food.

Fast forward to today, and after 6 months of sticking too many things on the credit card because we needed to save what was coming into my account for paying bills and whatnot, I am within spitting distance of paying off the card completely. I have all along paid off as much of it as possible but there's almost always been about £100 worth of stuff on there at any given time.

Now however, we're considering buying a car on it (M needs a car for work) because our current car is coming up for MOT and every year we've had it it's cost more than the car is worth to get it to pass it's MOT. It's really only fit for the scrapyard, and I cant even use it now if the weather is warm, because the windows dont work and I end up vomiting from the heat after about 15 minutes. Lovely.
On one hand, spending £400 to get the car to pass its MOT when a new car is necessary in the near future anyway and would only cost about twice that seems ridiculous. We'd be paying for the privilege of driving around a junkheap on wheels for another month or two.
On the other hand, the very idea of buying something we don't have the money in our hands to pay for grates against every fibre of my being. For two months I've had the credit card locked up and I've only used my debit card and I haven't used the overdraft.

I've been sorting through our money and our debts (loans of money from his parents and one of my friends, parents was for rental deposits, the loan from my friend was because uni was threatening to refuse me entry unless I paid them outstanding fees RIGHT NOW, and the only reason I still have that one is because she doesn't want it back yet, because the exchange rate sucks too much) and working out how much we need to save for the next year or so, and how to go about doing that. My mind is filled with money at the moment and I'm VERY intrigued by how other people handle their finances, especially debt, as its something that until this year basically, I've never had to deal with in my life.
Oh, I also have a student loan but I dont consider that proper debt.

We have no mortgage - own house outright - but have credit card "debt". I guess it's all relative, but I'm certainly happier it's that way around than the other!!

We may have to take on a small mortgage in the near future (and I'm talking £35,000) as we're having an extension done at some point, but not something that will get us into debt.

However, I have been in a bit of a pickle before, and I won't judge people who get into it - unless they really have just spent on stupid stuff.

As a student... hell yes... Although it is shrinking rather than growing at the minute which is nice. Also my student overdraft, which is around 1600 quid (nearly at the bottom at the moment) although that's interest free. And i have a very small amount of credit card debt.

We have no debt other than the mortgage.
I have always been anti debt and in fact have in the past played the debt system with 0% cards to protect interest on savings.
In my line of work I see many many people that are in debt
Of course there will always be a % of people who run up huge debts for "must haves", or those that chose to spend their money on frivalous thing such as giant TVs and yet don't pay their rent.
However, there are an increasing number who, in todays climate, are forced to take on debts and incur them simply because they have no other means to survive.

i'm in lots of debt. i have a £1000 loan, £500 on my credit card. and a laptop bought on finance.

we bought our laptop a couple of years ago. and knowing that we couldnt afford to buy it outright we are paying for it monthly wasnt a problem at the time.

my loan and my credit cards we're run up buying food / paying the bills when my partner was made redundant from his main job last year and due to having a 2nd job couldnt claim any benefits. our small income wasnt sufficient to pay the mortgage and monthly bills. so my credit card was run up and up until i got a loan to clear that and my over draft. however my credit card has been run up again with everyday necessities. we live in a crappy ex council house. we dont have a big flat screen telle or flashy clothes. we just have basic car and food in the cupboard.

i think our debt will be almost cleared in approx 12 months. but i cant be sure.

sometimes debt cant be helped but i do think alot of people pee the money up the wall (drugs alcohol, telles, cloths etc) and then whinge when they are skint and cant afford food. i know people like this and it winds me up!

Henri, I got myself into HUGE amounts of debt when I left Uni. I was living in London, working for a publishing company, learning to drive (for work, even though they didn't pay for my lessons), paying off student debts. We lived in a reasonably priced maisonette but I lived in West Norwood and worked in Teddington, so travel cards were expensive. We were expected to party hard and wear 'nice' clothes, but we were paid really badly. So credit and store cards were the way to go

I eventually realised I had to stop (and that I hated the whole ethos of the place that I worked), so I stopped and started to pay off the debt.

Then I got the sack.

I got a new job, but I did realise that this was not what I wanted to do with the rest of my life. So I went back to college to do my PGCE, using large loans to pay off what I hadn't managed to, with 'affordable' repayments. OK, I took extra on the loans so that I would have money to make the payments for the year that I would not be working. This didn't stop me racking up the CC again, because I only had enough money to pay off my debts, so we lived off the CC. My hubby's money was paying the mortgage and household bills.

Then I fell pregnant.

I was EXTREMELY lucky to find a headteacher who took me on pregnant and who offered to keep open my job, though she didn't legally have to as I didn't have a contract until I came back. Of course, then I had no money as I was paying for childcare AND my debts.

Needless to say, it's taken most of this last 10 years to pay off all of our debts and we are really only in that mostly comfortable place this last two years because we've been able to rent out the UK house. We have about £2K to go in the UK (other than the mortgage on the UK house) and about $3K here. That should all be paid off by July.

I am NEVER going to let it happen again. I would go back to work before I let that happen!

My advice to you is to keep good records, write your budget down and refer to it regularly. It's the only way I can keep a handle on what's going on...I say, I, I mean my hubby! I just ask him if I can buy this, that or the other as I'm plainly RUBBISH with money!

I'm totally hopeless with money, always have been. I have no patience and if I want something then I want it NOW. It's no excuse, but keeping up with my colleagues has played a part. I have a professional job and am surrounded by similar professionals, but mainly they are in relationships with a fellow professional and therefore have a large combined salary. My unemployed dh can't really compete with that, but it hasn't stopped me trying.

Another reason for it is that my Dad is always there to bail me out. Maybe if he'd been tougher then I'd have learnt my lesson a long time ago. Until a couple of years ago I don't think I had ever lived within my income. I ran up the cards and the loans and then I'd switch them all over to someone else for a lower interest rate. Robbing Peter to pay Paul was my hobby. Then I met some great people on another forum, who became best friends and who pretty much shamed me into sorting myself out. They had proper budgets and knew what they could spend and if they didn't have the cash then they didn't buy it.

These days I'm (almost) a reformed character. Last year my Dad lent me enough money (from his pension payout ) to pay off everything. I now pay him back as and when I can. I've benefited greatly from the drop in interest rates as I have a tracker mortgage and that has also helped enormously. I still have treats, but I am SO much better than before. I have wanted a new car for months and in years gone by I'd have just gone and got one and worried about how we'd manage later. Now I'm having to wait.

responsible people, good life lessons, complex expereinces, good advice, wading through treacle

I have no debt either i guess i was bought up in a family that was if you want something so bad save for it and then buy. Luckily i do not own my home so no mortgage to worry about either. If i want something i do save for it and feel happy that i can achieve this. Although some people do find it hard to save guess i am a lucky one there.

Some people do not get into debt on purpose either, my brother is in debt now and not through his own fault he has his home and lost a job and became ill. Now he is on disability long term through illness, but i have to say people can get in debt on urpose and i do think that is foolish only have theirselves to blame for that one