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  • FIRST POST
    • Fi&Cdebtfree
    • By Fi&Cdebtfree 17th Oct 16, 11:21 PM
    • 2Posts
    • 2Thanks
    Fi&Cdebtfree
    How to get out of this debt
    • #1
    • 17th Oct 16, 11:21 PM
    How to get out of this debt 17th Oct 16 at 11:21 PM
    Hello looking for advice. We are drowning in debt and dont know the best way to turn. Advice appreciated.
    SOA below

    Household Information[/b]
    Number of adults in household........... 2
    Number of children in household......... 2
    Number of cars owned.................... 2

    Monthly Income Details

    Monthly income after tax................ 2580
    Partners monthly income after tax....... 750
    Benefits................................ 136
    Other income............................ 0
    Total monthly income.................... 3466


    Monthly Expense Details

    Mortgage................................ 894.3
    Secured/HP loan repayments.............. 0
    Rent.................................... 0
    Management charge (leasehold property).. 0
    Council tax............................. 158
    Electricity............................. 44
    Gas..................................... 44
    Oil..................................... 0
    Water rates............................. 76.71
    Telephone (land line)................... 0
    Mobile phone............................ 70 - 3 phones
    TV Licence.............................. 12.12
    Satellite/Cable TV...................... 81
    Internet Services....................... 0
    Groceries etc. ......................... 350
    Clothing................................ 30
    Petrol/diesel........................... 140
    Road tax................................ 40
    Car Insurance........................... 28.52
    Car maintenance (including MOT)......... 0
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 0
    Other child related expenses............ 132
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 34.66
    Buildings insurance..................... 20
    Contents insurance...................... 23
    Life assurance ......................... 51.75
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 0
    Haircuts................................ 0
    Entertainment........................... 0
    Holiday................................. 0
    Emergency fund.......................... 0
    Total monthly expenses.................. 2230.06



    Assets

    Cash.................................... 300
    House value (Gross)..................... 269000
    Shares and bonds........................ 0
    Car(s).................................. 2000
    Other assets............................ 0
    Total Assets............................ 271300



    Secured & HP Debts

    Description....................Debt......Monthly.. .APR
    Mortgage...................... 158000...(894.3)....0
    Total secured & HP debts...... 158000....-.........-


    Unsecured Debts
    Description....................Debt......Monthly.. .APR
    loan...........................17000.....480...... .0
    lloyds.........................7200......222...... .0
    lloyds.........................5500......150...... .0
    halifax........................4500......45....... .0
    bc.............................6000......150...... .0
    bc.............................4000......102...... .0
    Total unsecured debts..........44200.....1149......-



    Monthly Budget Summary

    Total monthly income.................... 3,466
    Expenses (including HP & secured debts). 2,230.06
    Available for debt repayments........... 1,235.94
    Monthly UNsecured debt repayments....... 1,149
    Amount left after debt repayments....... 86.94


    Personal Balance Sheet Summary
    Total assets (things you own)........... 271,300
    Total HP & Secured debt................. -158,000
    Total Unsecured debt.................... -44,200
    Net Assets.............................. 69,100


    Thanks
Page 1
    • 19lottie82
    • By 19lottie82 18th Oct 16, 12:54 AM
    • 5,591 Posts
    • 8,573 Thanks
    19lottie82
    • #2
    • 18th Oct 16, 12:54 AM
    • #2
    • 18th Oct 16, 12:54 AM
    According to your SOA you should have £1236 each month left for your debt repayments, do you?

    I'm guessing not as you haven't accounted any cash for car maintenance / MOTs, yet you have 2 cars that are only worth a total of 3k? Clothes? You have 2 children but don't buy them any birthday or Christmas presents? No spends on entertainment, ever?

    It's important an SOA is realistic, not just what you would like to spend.....

    Check your bank / card statements and see how Much you actually spend on gifts, clothes and entertainment.......and groceries (is £350 a month realistic for main shops and top ups?) I expect it will be a lot
    More than you think and this is where the £1236 a month is going.

    You need a low but realistic budget for all of these categories, and stick to them!
    Last edited by 19lottie82; 18-10-2016 at 12:58 AM.
    • Bedsit Bob
    • By Bedsit Bob 18th Oct 16, 9:28 AM
    • 9,311 Posts
    • 48,764 Thanks
    Bedsit Bob
    • #3
    • 18th Oct 16, 9:28 AM
    • #3
    • 18th Oct 16, 9:28 AM
    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................ 2580
    Partners monthly income after tax....... 750
    Benefits................................ 136
    Other income............................ 0
    Total monthly income.................... 3466


    Monthly Expense Details

    Mortgage................................ 894.3
    Secured/HP loan repayments.............. 0
    Rent.................................... 0
    Management charge (leasehold property).. 0
    Council tax............................. 158 - Is this over 10 months? If so, switching to 12 months will reduce it to £131-66.
    Electricity............................. 44 - This is high. Check comparison sites.
    Gas..................................... 44 - This is high. Check comparison sites.
    Oil..................................... 0
    Water rates............................. 76.71
    Telephone (land line)................... 0
    Mobile phone............................ 70 - 3 phones - Go to PAYG/sim (~ £10 pm, per phone) only as soon as out of contract.
    TV Licence.............................. 12.12
    Satellite/Cable TV...................... 81 - This is £972 pa, which is Get rid and go Freeview/Freesat.
    Internet Services....................... 0
    Groceries etc. ......................... 350
    Clothing................................ 30
    Petrol/diesel........................... 140
    Road tax................................ 40
    Car Insurance........................... 28.52
    Car maintenance (including MOT)......... 0 - Nothing
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 0 - Nothing?
    Other child related expenses............ 132
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 34.66
    Buildings insurance..................... 20
    Contents insurance...................... 23 - This is high. Check comparison sites.
    Life assurance ......................... 51.75 - - This is high. Check comparison sites.
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 0 - Two children, and you never buy any presents?
    Haircuts................................ 0 - Never?
    Entertainment........................... 0 - Nothing, ever?
    Holiday................................. 0 - Not even days out to the seaside/zoo?
    Emergency fund.......................... 0 - You need something in here, especially being a home owner.

    Total monthly expenses.................. 2230.06



    Assets

    Cash.................................... 300
    House value (Gross)..................... 269000
    Shares and bonds........................ 0
    Car(s).................................. 2000
    Other assets............................ 0
    Total Assets............................ 271300



    Secured & HP Debts

    Description....................Debt......Monthly.. .APR
    Mortgage...................... 158000...(894.3)....0
    Total secured & HP debts...... 158000....-.........-


    Unsecured Debts
    Description....................Debt......Monthly.. .APR
    loan...........................17000.....480...... .0
    lloyds.........................7200......222...... .0
    lloyds.........................5500......150...... .0
    halifax........................4500......45....... .0
    bc.............................6000......150...... .0
    bc.............................4000......102...... .0
    Total unsecured debts..........44200.....1149......-



    Monthly Budget Summary

    Total monthly income.................... 3,466
    Expenses (including HP & secured debts). 2,230.06
    Available for debt repayments........... 1,235.94
    Monthly Unsecured debt repayments....... 1,149
    Amount left after debt repayments....... 86.94


    Personal Balance Sheet Summary
    Total assets (things you own)........... 271,300
    Total HP & Secured debt................. -158,000
    Total Unsecured debt.................... -44,200
    Net Assets.............................. 69,100
    Originally posted by Fi&Cdebtfree
    My comments in red.

    There seems to be quite a bit missing from your SOA, which probably explains why you are showing a small surplus, while, in your words, "drowning in debt".

    Are all your debts really 0% APR?

    I think you need to revisit your SOA, filling in the blank lines, and, if applicable, the APRs.
    Last edited by Bedsit Bob; 18-10-2016 at 9:31 AM.
    My job is Top Secret. Even I don't know what I'm doing.

    Amount I have so far denied the BBC - £1015-50
    • EssexHebridean
    • By EssexHebridean 18th Oct 16, 9:40 AM
    • 6,315 Posts
    • 35,034 Thanks
    EssexHebridean
    • #4
    • 18th Oct 16, 9:40 AM
    • #4
    • 18th Oct 16, 9:40 AM
    Exactly the advice others have given really - I'm guessing you don;t currently have any sort of surplus at the end of each month - and if that is the case that alone tells you that the SOA isn't reflecting real life.

    Grab (ideally) 6 months of bank statements, and sit down with them - check all the figures you've already input, and highlight anything that appears on the statement that is not in the SOA currently. Go through the highlighted items one at a time and categorise them - I'm guessing you'll find that some of the items will fill the gaps in the SOA once you've averaged them out.

    That £300 cash you have currently can form the basis of an emergency fund - albeit ideally you need to add to this as well. You also need to budget for the areas you're not currently covering.

    How old are your children? That can make a difference to spends.

    There are savings to be made on the SOA as things stand but I don't think there's a lot of point in many more comments until you re-do it to reflect your actual spending, rather than the ideal. Include in it areas of new budgeting (car maintenance being a prime example) but then you MUST make sure that money is put aside, preferably into a completely separate savings account. Check whether your bank allows you to open savings accounts off your current account that you can just shift your budgeted amount into each month - this method works well for most people.
    MORTGAGE FREE 30/09/2016
    • MallyGirl
    • By MallyGirl 18th Oct 16, 11:47 AM
    • 1,551 Posts
    • 3,749 Thanks
    MallyGirl
    • #5
    • 18th Oct 16, 11:47 AM
    • #5
    • 18th Oct 16, 11:47 AM
    Water rates............................. 76.71 is high. If you have a meter then you need to change your habits, if not then it would be worth getting one.
    However, unless you have addressed the causes of the £44k of debt then whittling away at the odd bill here and there isn't going to make a dent in your situation.
    What was the £17k loan for?
    what are the APRs on all the debts?
    • EssexHebridean
    • By EssexHebridean 18th Oct 16, 12:19 PM
    • 6,315 Posts
    • 35,034 Thanks
    EssexHebridean
    • #6
    • 18th Oct 16, 12:19 PM
    • #6
    • 18th Oct 16, 12:19 PM
    ]Water rates............................. 76.71 is high[/B]. If you have a meter then you need to change your habits, if not then it would be worth getting one.
    However, unless you have addressed the causes of the £44k of debt then whittling away at the odd bill here and there isn't going to make a dent in your situation.
    What was the £17k loan for?
    what are the APRs on all the debts?
    by MallyGirl;71471501[B
    If there's no meter then the OP will be in the South West I'm guessing - HORRENDOUS costs for water down there and honestly, with 4 of them in the house including two children potentially needing frequent hosing down, a meter might not actually be a good move.
    MORTGAGE FREE 30/09/2016
    • enthusiasticsaver
    • By enthusiasticsaver 18th Oct 16, 3:15 PM
    • 2,540 Posts
    • 4,354 Thanks
    enthusiasticsaver
    • #7
    • 18th Oct 16, 3:15 PM
    • #7
    • 18th Oct 16, 3:15 PM
    Not much to add that has not already been pointed out. The water rates are high but if OP is in South West then they are high. Groceries could probably be cut to £300 or even £250 if shopping in Lidl or Aldi. Insurances are all high so comparison sites for them as they fall due and get rid of satellite tv and change mobile phones to sim only. What are other child related expenses? No aprs on debts.

    As has been said many other times on this site there is unfortunately no short cut to getting rid of debt. I strongly suspect at least one if not more of the debts were to consolidate debt and you have probably been living beyond your means for some considerable time. Others though have paid off your level of debt and your incomes are high enough at least to cover minimum payment so if you move as much as possible to 0% and snowball payments then it can be cleared but it takes a lot of money discipline. Good luck.

    The SOA needs to be redone accurately to show presents bought,entertainment, haircuts, an emergency fund and something to maintain cars.
    Debt and mortgage free and saving for early retirement
    • Fi&Cdebtfree
    • By Fi&Cdebtfree 18th Oct 16, 6:30 PM
    • 2 Posts
    • 2 Thanks
    Fi&Cdebtfree
    • #8
    • 18th Oct 16, 6:30 PM
    • #8
    • 18th Oct 16, 6:30 PM
    Thanks all for replies. It is totally our fault we are in this Debt, just need to try and get out of it. Our children are 13 & 10. We are in the South West looked into a water meter but it would not benefit us to change.
    I will pull out a few bank statements tomorrow and post a more accurate SOA.
    • bsod
    • By bsod 18th Oct 16, 6:36 PM
    • 1,055 Posts
    • 643 Thanks
    bsod
    • #9
    • 18th Oct 16, 6:36 PM
    • #9
    • 18th Oct 16, 6:36 PM
    how many litres of water do you think £920 buys?
    • Bedsit Bob
    • By Bedsit Bob 18th Oct 16, 6:53 PM
    • 9,311 Posts
    • 48,764 Thanks
    Bedsit Bob
    how many litres of water do you think £920 buys?
    Originally posted by bsod
    It's not just water coming in.

    There's also waste water disposal, and rainwater drainage.
    My job is Top Secret. Even I don't know what I'm doing.

    Amount I have so far denied the BBC - £1015-50
    • bsod
    • By bsod 18th Oct 16, 6:55 PM
    • 1,055 Posts
    • 643 Thanks
    bsod
    It's not just water coming in.

    There's also waste water disposal, and rainwater drainage.
    Originally posted by Bedsit Bob
    You don't say
    • Bedsit Bob
    • By Bedsit Bob 18th Oct 16, 6:58 PM
    • 9,311 Posts
    • 48,764 Thanks
    Bedsit Bob
    You don't say
    Originally posted by bsod
    The point I'm making is, no matter how economical you are with the water you consume, you still have to pay for the other services, so you will never get your water rates to be very cheap.
    My job is Top Secret. Even I don't know what I'm doing.

    Amount I have so far denied the BBC - £1015-50
    • MrsPorridge
    • By MrsPorridge 18th Oct 16, 7:15 PM
    • 1,478 Posts
    • 1,562 Thanks
    MrsPorridge
    I'm also in the SW and no matter how careful you are with the water (we are on meter) it's still horrendous.
    Getting back on Track
    • enthusiasticsaver
    • By enthusiasticsaver 18th Oct 16, 7:17 PM
    • 2,540 Posts
    • 4,354 Thanks
    enthusiasticsaver
    I would agree. Ours has just gone up to £48 for just 2 of us and we are economical with water. We live in Cornwall. Not even washed the cars this summer.
    Debt and mortgage free and saving for early retirement
    • bsod
    • By bsod 18th Oct 16, 7:28 PM
    • 1,055 Posts
    • 643 Thanks
    bsod
    The point I'm making is, no matter how economical you are with the water you consume, you still have to pay for the other services, so you will never get your water rates to be very cheap.
    Originally posted by Bedsit Bob
    Like any other metering system, what you use has a direct bearing on what you pay, so unfortunately your point is misguided. The fixed charges and surface water drainage charges are less than £50
    Last edited by bsod; 18-10-2016 at 7:50 PM.
    • Takeaway_Addict
    • By Takeaway_Addict 18th Oct 16, 8:11 PM
    • 5,387 Posts
    • 6,081 Thanks
    Takeaway_Addict
    Why is the southwest so expensive compared to other areas for water then?
    Don't trust a forum for advice. Get proper paid advice. Any advice given should always be checked
    • EssexHebridean
    • By EssexHebridean 18th Oct 16, 8:17 PM
    • 6,315 Posts
    • 35,034 Thanks
    EssexHebridean
    Like any other metering system, what you use has a direct bearing on what you pay, so unfortunately your point is misguided. The fixed charges and surface water drainage charges are less than £50
    Originally posted by bsod
    I think perhaps you are not aware of quite how high the costs applicable to water in the South West of England are. The OP says that they have been advised at a meter would not save them money, and sadly for them, in that area, I strongly suspect they are right. As a contrast our water rates in Essex are roughly half what they are paying. On the face of it your assertion is correct - however it doesn't always apply in practice.

    Why is the southwest so expensive compared to other areas for water then?
    Originally posted by Takeaway_Addict
    Here you go -THIS is what South West Water have to say about it.
    Last edited by EssexHebridean; 18-10-2016 at 8:22 PM.
    MORTGAGE FREE 30/09/2016
    • bsod
    • By bsod 18th Oct 16, 8:18 PM
    • 1,055 Posts
    • 643 Thanks
    bsod
    area, population density, topography

    I am aware.

    If people think that the words 'south west' suddenly means that a household can't save money with a water meter, they are misguided.
    Last edited by bsod; 18-10-2016 at 8:23 PM.
    • Jon B
    • By Jon B 18th Oct 16, 9:08 PM
    • 722 Posts
    • 620 Thanks
    Jon B
    I live in Bristol. (Does that count as SW) and our family of 4 pay £29/month on a meter for water.
    • enthusiasticsaver
    • By enthusiasticsaver 18th Oct 16, 10:42 PM
    • 2,540 Posts
    • 4,354 Thanks
    enthusiasticsaver
    I live in Bristol. (Does that count as SW) and our family of 4 pay £29/month on a meter for water.
    Originally posted by Jon B
    I don't think Bristol comes under SW Water. We have a water meter for 2 of us in Cornwall and our water bill is now £58 per month.
    Debt and mortgage free and saving for early retirement
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