Are we nearly there yet?

Pauper1 · 26 October 2017 at 7:52AM

I've been on these forums for nine years (according to all the messages I got from MSE Badger when I signed back in after a few years break), so it's been nine years that I've struggled with money. DH and I entered our 'living together life' with £2k worth of debt, and I remember thinking we'd never get out of it. It massively snowballed after we bought our house in 2010, especially when I became ill, and at our highest we owed nearly £40k.

After we had our son, we were living in a 2 bed flat, without a garden, and no prospect of moving for years despite the fact we wanted another baby. Our DMP wasn't due to end until 2030something, when we'd be in our 40s. We spent a year or so weighing up the various options - not having another baby yet, me going back to work to pay it all off sooner, having another baby and dealing with the smallness of the house, IVA. In the end we decided to sell our house as it had gone up in value so much.

Unfortunately we didn't make enough to pay it all off outright, so we're currently going through the settlement process with StepChange. We're making about a 58% offer I believe, but with supporting evidence as to why our income won't change in the foreseeable, so they are better off accepting the offer. It works in our favour that rent is so much more expensive than our mortgage, as our DFD based on the new DMP is 2044! Our debt advisor says they probably won't want to wait that long. I'm just waiting for my MH counsellor to send a letter about my PND that I can pass on to StepChange, and then the ball will get rolling.

In the meantime, as our disposable income has dropped, I am focusing on spending less and trying to build up some savings. Once the debt is all settled, it will be about 4 years before the partial settlements/defaults drop off our credit file and we can think about buying again. So I will be trying to get a deposit together in those 4 years.

We are due our second baby now in April, and I am working through my PND with a local counselling service. I will probably go back on the meds once baby is born, and then when it's about 2 (or before, if I'm going mad) I will try to find work to build up the savings even more. I'm also keeping busy with the OU.

juliejim · 26 October 2017 at 8:04AM

Morning pauper1

Hope you hear soon from Stepchange and it all sorts itself out. Congratulations on baby no 2, how old is your DS?

Just thought I would say hi.

Julie

Pauper1 · 26 October 2017 at 8:36AM

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 89
Partners monthly income after tax....... 1728
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1817

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 750
Management charge (leasehold property).. 0
Council tax............................. 125
Electricity............................. 90 (dual fuel - we've only been here 4 months so it's still mostly an estimate, I have spoken to them to reduce it to £75, which they are looking at)
Gas..................................... 0
Oil..................................... 0
Water rates............................. 42
Telephone (land line)................... 0
Mobile phone............................ 31 (two mobiles - thinking about switching to Tesco, but have both been with o2 for about 10 years which I know is good for credit file)
TV Licence.............................. 12.12
Satellite/Cable TV...................... 0
Internet Services....................... 18.99 (broadband & line rental)
Groceries etc. ......................... 200 (this is super optimistic, but it's what I'm aiming for this month)
Clothing................................ 10
Petrol/diesel........................... 150 (I don't think this is ever this much but it's just a guess until the end of this month)
Road tax................................ 23
Car Insurance........................... 65
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 18.99 (swimming lessons)
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 49 (this is with PetPlan, who are the best insurers according to vets I have spoken to, but it's so expensive and we might never need it. Can't work out if it's a false economy)
Buildings insurance..................... 0
Contents insurance...................... 10
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 40
Haircuts................................ 12
Entertainment........................... 10
Holiday................................. 50
Emergency fund.......................... 0
Netflix................................. 5.99
Spotify................................. 4.99 (going to check with DH if I can cancel this)
HMRC.................................... 27 (this is the last month paying this)
Total monthly expenses.................. 1775.08[/b]

Assets
Cash.................................... 6086
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 2000
Other assets............................ 0
Total Assets............................ 8086

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
DMP............................27351.....50........0
Capital One CC.................53.65.....5.........30.34
Vanquis CC.....................107.02....6.5.......24.69
Total unsecured debts..........27511.67..61.5......-

Monthly Budget Summary
Total monthly income.................... 1,817
Expenses (including HP & secured debts). 1,775.08
Available for debt repayments........... 41.92
Monthly UNsecured debt repayments....... 61.5
Amount short for making debt repayments. -19.58

Personal Balance Sheet Summary
Total assets (things you own)........... 8,086
Total HP & Secured debt................. -0
Total Unsecured debt.................... -27,511.67
Net Assets.............................. -19,425.67

Created using the SOA calculator at https://www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using other browser.

The minus amount on the total on this is rather worrying, but we tend to use my husband's quarterly bonuses to book holidays, pay for car services, buy Christmas presents etc, rather than saving monthly. But it's never guaranteed so I wanted to do it "properly". With some of the changes marked in red above I think I can get the monthly costs down a bit. Plus once baby comes in April we'll start to qualify for CTC, which will be an extra £200 or so a month, and babies don't cost a lot until they're older really.

Edited to mention the credit cards - they are what we do our grocery and petrol spends on, and they usually get paid off in full, or pretty much, each month.

juliejim thanks for stopping by! My son will be 2 in a few weeks, so it's worked out for him to be a nice age when the baby comes. Although, of course, I'm having feelings about him not getting 100% of our attention anymore and the baby not having that 100% from the start like DS had haha. Mum guilt is AWFUL.

Mnd · 26 October 2017 at 8:54AM

Hi hope this helps. Your soa does look tight
Mobiles we are with tesco. I pay 20 a month for 2 phones and it's fine
I'm too mean to pay for Spotify. I just put up with the ads!
I think you ought to consider ditching the pet insurance, you havnt got much wriggle room otherwise

DebtFreeDuo · 26 October 2017 at 9:12AM

Are you not entitled to any CTC at the moment? Do you receive child benefit? Also do you only watch Netflix? If you don't watch any live TV and only watch catch up (excluding BBC) then you do not require a TV licence. £65 on car insurance is a lot, I see you have two cars, do you need two cars at the moment?

HairyHandofDartmoor · 26 October 2017 at 10:24AM

Good luck with your offers Pauper.

We are in a similar position to you in that we had huge debt and a tiny income. We couldn't even afford a dmp and were on token payments of £1 a week for two years

Luckily DH had a pension from an ancient job that he cashed in a few months ago and we have made Full anf Final offers to all seven of our joint creditors. We could only afford to offer 50% but six of them have said yes :T. So our debt has gone from over £58,000 to £16,200 almost overnight :j.

We are having trouble with creditor number seven unfortunately who owns two of DH's debts

, but we are hoping they will say yes eventually

.

Good luck and I really hope that your creditors say yes

Great news about the new baby too :T

Pauper1 · 26 October 2017 at 11:24AM

Wow, so many replies! Thanks everyone.

I've actually just sorted out our mobiles since posting the SOA. I've checked we are out of our contracts with o2 (and discovered that DH's had gone up to £18.46!), and done a comparison on sim only deals. I've sorted out new deals with PlusNet for £8 each a month, with £22 cashback. Feeling pretty pleased with myself. So that saves us £18.36 a month, meaning we are only £1.22 behind now. I'm quite sure DH will agree to cancel Spotify, but as he uses it more than me I just wanted to double check.

MND thank you for your reply. I wanted to switch to Tesco (for the points!) but PlusNet ended up being a lot cheaper. My next mission is the pet insurance, but I think I'll keep our older cat with PetPlan and then take out the cheapest ones for the other two as they're a lot younger. Hopefully once we've got a bit more space I'll be able to put them back on, but they're the lower risk at the moment, whereas poor Old Alan is getting on a bit.

DebtFreeDuo I put the child benefit as my income because it's all I personally get at the moment. We don't get any CTC because my husband's income is apparently enough, but once we add another dependant we will qualify. I will double check though, because I think we could claim for about £4 something a month, so I might! We do watch live TV. Yes, our car insurance is quite high because we only had one car for a while so I lost all my no claims. But we do need two cars due to where we live now.

HairyHandOfDartmoor what an amazing name, by the way! That's a brilliant ending. I think when they are only getting a small payment and it will take ages for them to get anything really, they are much more likely to want to take an offer. Fingers crossed for the last creditor. What an amazing feeling it will be to be debt free. How long has it taken your creditors to accept your offers? Our debt advisor said she hoped it would be all sorted 6-8 weeks after we start, but I'm just waiting for my counsellor which is annoying because I want to get going.

Pauper1 · 26 October 2017 at 1:15PM

Okay, another update from me (keeps me on track)

I've kept Old Alan on the same pet insurance policy and switched the two girlies to a cheaper company. Saved us £16.76 a month, and got £21 cashback coming my way.

New SOA from next month:

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 0
Partners monthly income after tax....... 1728.55
Benefits................................ 89.7
Other income............................ 0
Total monthly income.................... 1818.25

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 750
Management charge (leasehold property).. 0
Council tax............................. 125
Electricity............................. 75
Gas..................................... 0
Oil..................................... 0
Water rates............................. 42
Telephone (land line)................... 0
Mobile phone............................ 16
TV Licence.............................. 12
Satellite/Cable TV...................... 18.99
Internet Services....................... 0
Groceries etc. ......................... 200
Clothing................................ 10
Petrol/diesel........................... 150
Road tax................................ 22.74
Car Insurance........................... 65.31
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 18.99
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 32.03
Buildings insurance..................... 0
Contents insurance...................... 10.3
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 40
Haircuts................................ 12
Entertainment........................... 10
Holiday................................. 50
Emergency fund.......................... 0
Netflix................................. 5.99
Total monthly expenses.................. 1696.35

Assets
Cash.................................... 6086
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 2000
Other assets............................ 0
Total Assets............................ 8086

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
DMP............................27351.....50........0
Capital One CC.................53.65.....5.........30.34
Vanquis CC.....................107.02....6.5.......24.69
Total unsecured debts..........27511.67..61.5......-

Monthly Budget Summary
Total monthly income.................... 1,818.25
Expenses (including HP & secured debts). 1,696.35
Available for debt repayments........... 121.9
Monthly UNsecured debt repayments....... 61.5
Amount left after debt repayments....... 60.4

Personal Balance Sheet Summary
Total assets (things you own)........... 8,086
Total HP & Secured debt................. -0
Total Unsecured debt.................... -27,511.67
Net Assets.............................. -19,425.67

Created using the SOA calculator at https://www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using other browser.

That's better...

zippygeorgeandben · 26 October 2017 at 1:20PM

I have to say about the pet plan.. i wish we had never started it for our cat. He's an indoor cat who has never been outside and yet we play £32.78 for the top cover. We don't have children, never had a pet and he's our life. I know you need cover but £33pm could be spent on something else for sure.

Pauper1 · 26 October 2017 at 4:10PM

zippygeorgeandben I have changed it from all of them being on PetPlan to just the eldest being covered by them as he's higher risk, and the younger two are with a cheaper company. It is still ridiculous though, because he is costing £20 a month whereas the girls are £11 in total, so if I need to I will switch him over as well but I am reluctant.

I have checked on Entitled To, and we don't qualify for anything.

I've been going over our budgets for this month, and at the moment we are on track with groceries and under for "entertainment". Unexpected spends are £41.39 and so far I have sold/made £34.85 in an attempt to cover these. Will add some more bits to FB/eBay at some point.

Now off to finish my meal plan and order my food shopping. Probably heavily rely on Jack Monroe's book