in debt reality check! Help Please?

welcome to DFW Missy - and well done on having your Lightbulb Moment - that's the toughest bit done, to be honest - so let's crack on and see how fast you can get things sorted.

Comments on your SOA in red, as usual...

missys86 wrote: »

Statement of Affairs and Personal Balance Sheet

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

Monthly Income Details
Monthly income after tax................ 1960
Partners monthly income after tax....... 1100
Benefits................................ 34 This seems low for 2 kids - does your income level rule you out of child benefit? It doesn't seem like it should?
Other income............................ 136
Total monthly income.................... 3230

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 379.88
Management charge (leasehold property).. 0
Council tax............................. 83 Do you pay this over 10 months or 12? If 10, remember that you should have this months payment still in the bank and nothing going on this next month. Might make life simpler to contact the council and ask them to put you onto 12 monthly payments from April, too
Electricity............................. 33
Gas..................................... 33
Oil..................................... 0
Water rates............................. 60 Is this metered? If so have a read of some water saving principles and see what you can do on that
Telephone (land line)................... 0
Mobile phone............................ 80 Ouchy! Are either of you out of contract or nearing the end? If so look for good SIM only deals that will slash this.
TV Licence.............................. 37 Why so much?
Satellite/Cable TV...................... 75 Ring your provider and haggle. If you don;t want to change, you don't have to pretend you do, just given them a call and tell them you want to stay, but can't afford to, and need to know what they can do for you.
Internet Services....................... 8.99
Groceries etc. ......................... 200
Clothing................................ 70 Slash this right down for now - yes I know kids need clothes, but the smaller one can wear the bigger one's cast offs, and for older kids eBay can be good, failing that the supermarket ranges offer good value for less money. For you & your OH it needs to be essentials only for a while
Petrol/diesel........................... 150
Road tax................................ 16.27 Do you actually pay this out monthly?
Car Insurance........................... 148 Whoah - how much?!!! That is £1700 p-er year which is a LOT of money on insurance. Why so much? have you used the comparison sites?
Car maintenance (including MOT)......... 0 You need something in here - two cars doing average mileage - think about setting aside a sum each month to cover MOT, servicing, and depreciative items
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 652 Do you use the childcare vouchers scheme to pay your childcare costs?
Other child related expenses............ 70 Is this essential? Can it be trimmed?
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 25
Buildings insurance..................... 0
Contents insurance...................... 8
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 50 Sorry to say but you need to trim this for the time being in my opinion.
Haircuts................................ 30
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0 You need to start getting something in here
Total monthly expenses.................. 2269.14


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0 Should the car values not be in here?
Other assets............................ 0
Total Assets............................ 0

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
sofa...........................1500......44.08.....0 Are all these definitely at 0%
car 1..........................12000.....201.8.....0
car 2..........................5500......144.......0
Total unsecured debts..........19000.....389.88....-


Monthly Budget Summary
Total monthly income.................... 3,230
Expenses (including HP & secured debts). 2,269.14
Available for debt repayments........... 960.86
Monthly UNsecured debt repayments....... 389.88
Amount left after debt repayments....... 570.98 Do you actually have this surplus each month? If not you need to start a spending diary and note every penny you spend to work out where it's going.

Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -19,000
Net Assets.............................. -19,000

On the face of it that isn't so bad. Allowing for the £570 surplus you should have, then you're looking at a touch under three years - albeit that may be able to reduce as obviously you';; be making the standard payments as well. If the sofa is - as it may be - on 0% - then leave that alone at the moment. Check whether there are any restrictions on overpaying the loans, and also whether there is any advantage to paying off in dribs and drabs rather than saving a lump sum to clear those. Saving a lump sum would have the advantage of covering both your emergency fund and car repair costs for the time being too - so that's worth thinking about.

One thing leaps out at me from your SOA - you say you're struggling to make ends meet - but your budget doesn't suggest that at all. Is the SOA abiove there how things currently are, or how you think they should be? There's a massive difference!

Hi there

You've had some good advice about trimming your budget, I thought it looked ok but would agree there are savings to be made.

If you get rid of the £12k car and got one more affordable then you wouldn't have much of a debt problem. Just a thought.

Best of luck.

Also as the others have said, go through your bills. Depending on your preference either put one afternoon aside and go through them all (compare, haggle etc) or set yourself a challenge of doing one per day. Say calling sky one day, gas and electric the next. There's a good guide in thr money diet if you're unsure xx

missys86 wrote: »

Both cars are on finance so could we trade on in?

If they are on hire purchase or conditional sale, then you can do a voluntary termination, and your liability is limited to half the total amount. So if you are already half way through the agreement, you should be able to escape without penalty

https://www.nationaldebtline.org/EW/factsheets/Pages/hire-purchase-debt/hire-purchase-and-conditional-sale.aspx