I’m 27 and currently dealing with £22K in debt. I know I’ve made some poor decisions, and it’s hard not to hate myself for it, but I’m trying to move forward. My mental health hasn’t been great (OCD and depression), and I’ve been in a bad cycle of overspending. Here’s where I’m at financially:
Take-home pay: £2,350/month
Rent: £500/month
Debts:
NatWest overdraft (40%): £1,940
Argos store card: £328.57
HSBC credit card (0% until March 2025): £1,298.93
HSBC credit card (26.9%): £652
Zopa credit card (30%): £700 (likely £1,200 by payday)
PayPal credit: £160
Capital credit card (30%): £1,200
Novuna personal loan (40%): £998 (settlement figure) or £1,790 if paid monthly
Fluid credit card (30%): £2,788
Community Finance consolidation loan: £12,000 (£398/month)
I tried using a loan to consolidate my debts, but I ended up spending more, which has only made things worse. StepChange suggested focusing on minimum payments and tackling one debt at a time, but it feels so overwhelming.
Here’s my budget:
Rent: £500
Internet: £20
Gym: £25.99
Cineworld pass: £19
TV subscriptions: £9.42
Extra entertainment: £20
PayPal repayment: £7.10 (minimum)
Groceries: £200
Fuel: £120
Phone: £29 (until October, then switching to PAYG)
Community Finance loan: £398
Car repayment: £175
Novuna loan: £36
Remaining debt payments: £660
This leaves about £100 as a buffer. I could pay off £7,920 in a year at this rate, but it feels like an endless cycle. I want to save for a house someday, but seeing friends in better financial positions makes it hard to stay positive. Is there any hope for recovery?
You’ve done a great job laying everything out clearly. Start by focusing on the highest interest rate debt—your overdraft at 40%. It might also be a good idea to cancel your Cineworld pass after a few months. It’ll save you some money and give you time to focus on paying things down. Remember, every pound you pay off is a step forward. You can do this!
Paying off smaller debts first can feel amazing, even if it’s not the most efficient way. Seeing those balances hit zero is such a boost. Keep your gym membership—it’s great for your mental health. You’ve got a plan, and that’s huge. Keep going and let us know how you’re doing!
Have you spoken to StepChange directly? When I needed help, they contacted my creditors to freeze interest, and I could make reduced payments. It really helped me get back on track. They might suggest a Debt Management Plan or other options. Don’t be ashamed—this is what they’re there for.
Reagan said: @Vail
I’ve only done their online analysis. Talking to someone directly makes me nervous, but I know I need to. I’ll give them a call soon.
They won’t judge you. It’s just another call for them, and they’ll help you make a plan. You’ll feel a lot better once you’ve spoken to them.
Stop comparing yourself to friends who have houses. Their situation is different, and you need to focus on your own goals. Clearing your debts is priority number one. A mortgage will come later when you’re in a better place financially.
You haven’t ruined your life—you’re taking the right steps. Keep paying down your debts, and as you clear each one, it’ll free up money to tackle the others. Try sticking to your food budget to save a little extra.
Start by paying off your smallest interest-bearing debts first. It’ll give you some quick wins and free up money to focus on the larger ones. Avoid using any buffer as extra spending money—put it straight into your debts.
Forget about buying a house for now and focus on clearing your debts. It’s great that you’ve laid everything out so clearly. Get into a strict budget and cut up those credit cards so you’re not tempted to spend more. You’ve got this!
You’re young, so this isn’t the end of the world. Speak to a debt advisor, and they can help you freeze interest or come up with a repayment plan. You can recover from this and still buy a house in a few years once you’re debt-free.