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  • FIRST POST
    • xmas_angel
    • By xmas_angel 14th Sep 17, 7:59 PM
    • 5Posts
    • 5Thanks
    xmas_angel
    Help! Drowning!
    • #1
    • 14th Sep 17, 7:59 PM
    Help! Drowning! 14th Sep 17 at 7:59 PM
    Evening,

    I've never posted before but have been reading the posts from people all seeking advice and guidance and I'm hoping that you can help guide me in the right direction.

    So we purchased our own home 2 years ago and since then our debts have spiralled. We've always lived in army accommodation so paying low rent and having a fair amount of disposable income to do what we wanted with each month, including purchasing new cars, mtorbikes etc because we didn't have a mortgage, I always reasoned that they were my mortgage payment. Then we purchased our own home, I'm afraid to admit we went mad, decorating and doing the house up and running up unsecured debts on our credit cards that we then paid off with our loans. Since then on top of the mortgage payment and loan payments we were then using our credit cards for everyday living. I feel like everything has spiralled, we both earn good money but have been stupid with our money and are now regretting decisions we made. Both cars and bike are on PCP deals so can't be sold, my pet insurance is high due to having 2 st bernards who I adore and could not stand to rehome but if I didn't have the insurance any bills would cripple us. I've cut everything out that I can, is there a debt I should be concentrating on paying off first? Where would you start to tackle this? I've posted our statement of affairs as well, any guidance would be greatfully received.
    Thank you in advance!

    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.................... 0

    Monthly Income Details
    Monthly income after tax................ 1828.96
    Partners monthly income after tax....... 2631.96
    Benefits................................ 137.6
    Other income............................ 0
    Total monthly income.................... 4598.52

    Monthly Expense Details
    Mortgage................................ 720
    Secured/HP loan repayments.............. 644.09
    Rent.................................... 0
    Management charge (leasehold property).. 0
    Council tax............................. 124
    Electricity............................. 83
    Gas..................................... 0
    Oil..................................... 50
    Water rates............................. 54.54
    Telephone (land line)................... 47.2
    Mobile phone............................ 47
    TV Licence.............................. 12.12
    Satellite/Cable TV...................... 10.98
    Internet Services....................... 0
    Groceries etc. ......................... 400
    Clothing................................ 0
    Petrol/diesel........................... 200
    Road tax................................ 5
    Car Insurance........................... 130
    Car maintenance (including MOT)......... 15.85
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 400
    Other child related expenses............ 0
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 196
    Buildings insurance..................... 22.65
    Contents insurance...................... 51.06
    Life assurance ......................... 0
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 0
    Haircuts................................ 0
    Entertainment........................... 0
    Holiday................................. 0
    Emergency fund.......................... 0
    Total monthly expenses.................. 3213.5


    Assets
    Cash.................................... 0
    House value (Gross)..................... 260000
    Shares and bonds........................ 0
    Car(s).................................. 0
    Other assets............................ 0
    Total Assets............................ 260000


    Secured & HP Debts
    Description....................Debt......Monthly.. .APR
    Mortgage...................... 192000...(720)......1.74
    Hire Purchase (HP) debt ...... 17850....(326.5)....0<
    Motorbike......................8500.....(141)..... .0<
    Car 2..........................6500.....(176.6)....0
    Total secured & HP debts...... 224850....-.........-

    Unsecured Debts
    Description....................Debt......Monthly.. .APR
    Barclaycard....................2543.43...60....... .0
    Tesco..........................2114.16...60....... .0
    Santander......................1892.89...30....... .0
    Furniture......................3000......94.87.... .0
    Overdraft Husband..............1500......0.........0
    Overdraft Mine.................2000......0.........0
    Tesco Loan.....................12854.....282.2.....11.9
    Tesco Loan.....................22893.....418.9.....11.9
Page 1
    • Mimi Arc en ciel
    • By Mimi Arc en ciel 14th Sep 17, 8:34 PM
    • 4,459 Posts
    • 5,755 Thanks
    Mimi Arc en ciel
    • #2
    • 14th Sep 17, 8:34 PM
    • #2
    • 14th Sep 17, 8:34 PM
    Take a breathe Xmas-angel, grab a coffee and take a moment

    That was the start of your journey. Congratulations ��


    Let's have a look at this SOA

    Evening,

    I've never posted before but have been reading the posts from people all seeking advice and guidance and I'm hoping that you can help guide me in the right direction.

    So we purchased our own home 2 years ago and since then our debts have spiralled. We've always lived in army accommodation so paying low rent and having a fair amount of disposable income to do what we wanted with each month, including purchasing new cars, mtorbikes etc because we didn't have a mortgage, I always reasoned that they were my mortgage payment. Then we purchased our own home, I'm afraid to admit we went mad, decorating and doing the house up and running up unsecured debts on our credit cards that we then paid off with our loans. Since then on top of the mortgage payment and loan payments we were then using our credit cards for everyday living. I feel like everything has spiralled, we both earn good money but have been stupid with our money and are now regretting decisions we made. Both cars and bike are on PCP deals so can't be sold, my pet insurance is high due to having 2 st bernards who I adore and could not stand to rehome but if I didn't have the insurance any bills would cripple us. I've cut everything out that I can, is there a debt I should be concentrating on paying off first? Where would you start to tackle this? I've posted our statement of affairs as well, any guidance would be greatfully received.
    Thank you in advance!

    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.................... 0

    Monthly Income Details
    Monthly income after tax................ 1828.96
    Partners monthly income after tax....... 2631.96
    Benefits................................ 137.6
    Other income............................ 0
    Total monthly income.................... 4598.52

    Monthly Expense Details
    Mortgage................................ 720
    Secured/HP loan repayments.............. 644.09
    Rent.................................... 0
    Management charge (leasehold property).. 0
    Council tax............................. 124
    Electricity............................. 83 this is high, does it include a debt?
    Gas..................................... 0
    Oil..................................... 50
    Water rates............................. 54.54 again, seems high
    Telephone (land line)................... 47.2 can you get a better deal?
    Mobile phone............................ 47 when does our interact end? Can you PAYG?
    TV Licence.............................. 12.12
    Satellite/Cable TV...................... 10.98
    Internet Services....................... 0
    Groceries etc. ......................... 400 this can be reduced.
    Meal plan, down shift products, go to another supermarket. Look on the old style board for grocery help

    Clothing................................ 0
    Petrol/diesel........................... 200
    Road tax................................ 5
    Car Insurance........................... 130 can you get a better deal?
    Car maintenance (including MOT)......... 15.85
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 400
    Other child related expenses............ 0
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 196 ouch!! I know you love them though have you shopped around for pet insurance?
    Buildings insurance..................... 22.65
    Contents insurance...................... 51.06 are you covered for the right amount? Have you over estimated?
    Life assurance ......................... 0
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 0 nothing?
    Haircuts................................ 0
    Entertainment........................... 0
    Holiday................................. 0
    Emergency fund.......................... 0
    Total monthly expenses.................. 3213.5


    Assets
    Cash.................................... 0
    House value (Gross)..................... 260000
    Shares and bonds........................ 0
    Car(s).................................. 0
    Other assets............................ 0
    Total Assets............................ 260000


    Secured & HP Debts
    Description....................Debt......Monthly.. .APR
    Mortgage...................... 192000...(720)......1.74
    Hire Purchase (HP) debt ...... 17850....(326.5)....0<
    Motorbike......................8500.....(141)..... .0<
    Car 2..........................6500.....(176.6)....0
    Total secured & HP debts...... 224850....-.........-

    Unsecured Debts
    Description....................Debt......Monthly.. .APR
    Barclaycard....................2543.43...60....... .0
    Tesco..........................2114.16...60....... .0
    Santander......................1892.89...30....... .0
    Furniture......................3000......94.87.... .0
    Overdraft Husband..............1500......0.........0
    Overdraft Mine.................2000......0.........0
    Tesco Loan.....................12854.....282.2.....11.9
    Tesco Loan.....................22893.....418.9.....11.9
    Originally posted by xmas_angel
    I'm not great with loans - I've never had one so hopefully someone more knowledgeable will Bob along

    With regards to your cars, have you stopped using them? Are all of your cards 0%? If not what are the Apr's? Which ever debt is 'costing' the most, I would concentrate on paying that one off and pay the minimum amount on the others.
    Last edited by Mimi Arc en ciel; 14-09-2017 at 8:37 PM.
    Very proud mummy of 2!
    • Fosterdog
    • By Fosterdog 14th Sep 17, 8:36 PM
    • 3,162 Posts
    • 5,464 Thanks
    Fosterdog
    • #3
    • 14th Sep 17, 8:36 PM
    • #3
    • 14th Sep 17, 8:36 PM
    Evening,

    I've never posted before but have been reading the posts from people all seeking advice and guidance and I'm hoping that you can help guide me in the right direction.

    So we purchased our own home 2 years ago and since then our debts have spiralled. We've always lived in army accommodation so paying low rent and having a fair amount of disposable income to do what we wanted with each month, including purchasing new cars, mtorbikes etc because we didn't have a mortgage, I always reasoned that they were my mortgage payment. Then we purchased our own home, I'm afraid to admit we went mad, decorating and doing the house up and running up unsecured debts on our credit cards that we then paid off with our loans. Since then on top of the mortgage payment and loan payments we were then using our credit cards for everyday living. I feel like everything has spiralled, we both earn good money but have been stupid with our money and are now regretting decisions we made. Both cars and bike are on PCP deals so can't be sold, my pet insurance is high due to having 2 st bernards who I adore and could not stand to rehome but if I didn't have the insurance any bills would cripple us. I've cut everything out that I can, is there a debt I should be concentrating on paying off first? Where would you start to tackle this? I've posted our statement of affairs as well, any guidance would be greatfully received.
    Thank you in advance!

    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.................... 0

    Monthly Income Details
    Monthly income after tax................ 1828.96
    Partners monthly income after tax....... 2631.96
    Benefits................................ 137.6
    Other income............................ 0
    Total monthly income.................... 4598.52

    Monthly Expense Details
    Mortgage................................ 720
    Secured/HP loan repayments.............. 644.09
    Rent.................................... 0
    Management charge (leasehold property).. 0
    Council tax............................. 124
    Electricity............................. 83 This is high considering you also have £50 on oil
    Gas..................................... 0
    Oil..................................... 50 This seems high but I know prices vary vastly depending on where you live
    Water rates............................. 54.54 way too high, if on a metre cut your usage, if not consider changing to one.
    Telephone (land line)................... 47.2 very high even if this is also broadband
    Mobile phone............................ 47 how many us this for? Seems high, go to sim only as soon as you can
    TV Licence.............................. 12.12
    Satellite/Cable TV...................... 10.98
    Internet Services....................... 0
    Groceries etc. ......................... 400 this can be cut down, visit the old style board for ideas
    Clothing................................ 0
    Petrol/diesel........................... 200
    Road tax................................ 5
    Car Insurance........................... 130
    Car maintenance (including MOT)......... 15.85
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 400
    Other child related expenses............ 0
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 196
    Buildings insurance..................... 22.65 This combines with contents is rediculusly high, mine is only £130 a year for both with plenty of coverage
    Contents insurance...................... 51.06
    Life assurance ......................... 0 you really need to consider this to pay off the mortgage and provide for the children if anything should happen
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 0 no presents ever?
    Haircuts................................ 0 never?
    Entertainment........................... 0 nothing even with two children?
    Holiday................................. 0
    Emergency fund.......................... 0 as a home owner you need one
    Total monthly expenses.................. 3213.5


    Assets
    Cash.................................... 0
    House value (Gross)..................... 260000
    Shares and bonds........................ 0
    Car(s).................................. 0
    Other assets............................ 0
    Total Assets............................ 260000


    Secured & HP Debts
    Description....................Debt......Monthly.. .APR
    Mortgage...................... 192000...(720)......1.74
    Hire Purchase (HP) debt ...... 17850....(326.5)....0<
    Motorbike......................8500.....(141)..... .0<
    Car 2..........................6500.....(176.6)....0
    Total secured & HP debts...... 224850....-.........-

    Unsecured Debts
    Description....................Debt......Monthly.. .APR
    Barclaycard....................2543.43...60....... .0
    Tesco..........................2114.16...60....... .0
    Santander......................1892.89...30....... .0
    Furniture......................3000......94.87.... .0
    Overdraft Husband..............1500......0.........0
    Overdraft Mine.................2000......0.........0
    Tesco Loan.....................12854.....282.2.....11.9
    Tesco Loan.....................22893.....418.9.....11.9
    when do your 0% deals end and what will they be when they do?
    Originally posted by xmas_angel
    Well done for looking for help, getting it all written down is the first step. I've added comments in red.

    I have worked out that you should have £439 left over each month after everything on your SOA is paid, as you haven't listed any cash I'm guessing you don't have that? Your next step is a spending diary for a minimum of a week, preferably at least a month listing every penny spent to see where this vast amount is disappearing. That includes the bar of chocolate when you get petrol, the extra sweets for the kids.
    • xmas_angel
    • By xmas_angel 14th Sep 17, 8:56 PM
    • 5 Posts
    • 5 Thanks
    xmas_angel
    • #4
    • 14th Sep 17, 8:56 PM
    • #4
    • 14th Sep 17, 8:56 PM
    Thank you so much for your replies!

    In answer to some of your questions:

    Electricity, just had this renewed onto a 1 year fixed deal and that was the lowest I could get it. I am in credit with the electric company and am leaving it for 6 months and then reclaim a refund of the credit to pay off the credit cards. Having a smart meter installed on the 30th as well.

    Oil, this goes to a 'tank account' which I can also use for my boiler service each year. 500 litres lasts around 6 months and last cost me £142

    Contents insurance is high because it includes husbands kit insurance. It's an irritation of mine as well but unfortunately they have to have it.

    Will look into the water meter, never considered that before!

    Car insurance has just renewed and we had a claim last year so expected it to go up, that amount is for the 2 cars and motorbike though.

    Pet insurance, one of the girls cost £46 to insure (much better) my older one £147 a month, due to her being diagnosed with mild hip dysplasia I cannot move insurance company but if she needed a hip replacement that's £7.5k per hip! Me and my husband have learnt out lesson though, our next pet will be a chihuahua 😂

    I'm feeling a bit more positive about it all. We've decided to go on a cash only budget so we don't overspend and then use credit cards to top us up. Cash left over will go on paying off the credit cards first. And writing a spending diary sounds like a really good idea as well so we both know where our money is going!!

    Thank you for responding!
    Claire
    • xmas_angel
    • By xmas_angel 14th Sep 17, 8:58 PM
    • 5 Posts
    • 5 Thanks
    xmas_angel
    • #5
    • 14th Sep 17, 8:58 PM
    • #5
    • 14th Sep 17, 8:58 PM
    I meant we'll go on a cash only budget so we don't use the credit cards anymore not that we'll use them to top us up! After reading it I realised it didn't sound right!!
    • worriedDan
    • By worriedDan 14th Sep 17, 9:12 PM
    • 183 Posts
    • 538 Thanks
    worriedDan
    • #6
    • 14th Sep 17, 9:12 PM
    • #6
    • 14th Sep 17, 9:12 PM
    Well done for posting - This is the hardest step. You have faced up to your debts and want to do something about it which is great.

    The good news is that your income still exceeds your outgoing, as is often not the case on here. We started off in a very similar situation to you with debts touching 60K on a similar salary to yours. I can remember all too well the stomach churning feeling when you finally add it all up. 6 months down the line and we are reducing the debts and feeling much better about it all.

    How long do you have left on your 0% promotional rates? You can definitely make some savings with your groceries. We are a family of 3 and we generally spend £200 per month. We do shop at Aldi/Lidl but we also eat really well and cook from scratch.

    Well done for taking this first step.
    • tealady
    • By tealady 15th Sep 17, 6:15 AM
    • 2,700 Posts
    • 3,174 Thanks
    tealady
    • #7
    • 15th Sep 17, 6:15 AM
    • #7
    • 15th Sep 17, 6:15 AM
    Hi
    If your husbabd has to have kit insurance yave you checked to see if you can claim tax back on the payment? I know if people have to wear a uniform and have to clean it themselves they can claim.
    HTH
    Last edited by tealady; 15-09-2017 at 7:48 AM. Reason: Spelling
    Proud to be an MSE nerd
    Judge people by their achievements, not by their mistakes
    • Fosterdog
    • By Fosterdog 15th Sep 17, 6:30 AM
    • 3,162 Posts
    • 5,464 Thanks
    Fosterdog
    • #8
    • 15th Sep 17, 6:30 AM
    • #8
    • 15th Sep 17, 6:30 AM
    With the kit insurance what is the insured value? Have you considered getting separate kit insurance and then combined buildings and contents?

    I've just run a quick quote with one of the kit insurance companies.
    First time I used £5500 of kit, £500 personal possessions, £25500 contents, and £500 for mobile phones and it came out at £33.90 a month (I did use a random postcode so it won't account for where you live)

    I ran a second quote upping the kit cover to £10000 and dropped the rest to £0 and it's only £22.12 a month.

    I genuinely have no idea what level of cover is required for kit so I may be way off the mark with my figures but if I'm even close you could save a fair chunk each year especially if you shop around for a better combined building and contents, your building cover alone is higher that most we see on here.
    • Beetroot24
    • By Beetroot24 15th Sep 17, 8:06 AM
    • 15 Posts
    • 22 Thanks
    Beetroot24
    • #9
    • 15th Sep 17, 8:06 AM
    • #9
    • 15th Sep 17, 8:06 AM
    I'd look into all of your insurance policies and figure out if it's worth it, or false economy to scrimp on your kit insurance. When my husband was in the Army, the kit insurance he had paid back £800 for a 4 year old (out of date) TV and PS3, that the kids managed to knock over. I think the excess was £50. When I'd been burgled whilst living with my mum a couple of years before, I can't remember how much her excess was, but her home insurance would only pay up £200 for my laptop that I'd bought 11 months before for £600. Insurance always feels like a waste of money until you need it.
    • xmas_angel
    • By xmas_angel 15th Sep 17, 8:11 AM
    • 5 Posts
    • 5 Thanks
    xmas_angel
    I will have a look into the kit cover and see exactly what we're covered for and see if I can cut it back a bit. I guess again, we've always been a bit naive where prices are concerned as we never had to worry about them, oh to be in that situation again. But you're all right, this should have been something we kept under control and looked into more. The biggest battle has been getting the husband on board, as while I was very aware the debt was rising he would still spend and I'd be moving money from my account to cover his bills that came out of his account. I'd then be left short and putting diesel and food on my credit card 🙄 Onwards and upwards as they say, I got paid today, I have my budget for the month, i will take out what we have available to spend on food, diesel and then leave my account well alone for the month. Keeping fingers crossed we can accumulate some cash left over to pay off a lump sum on one of the credit cards to reduce that a bit 🤞
    • Mnd
    • By Mnd 15th Sep 17, 10:25 AM
    • 122 Posts
    • 138 Thanks
    Mnd
    Your land line is extremely high, we pay £20 for land line broadband and bt sports
    Also how many phones are covered by the £40. We pay half that for 2 phones
    • kram
    • By kram 15th Sep 17, 12:59 PM
    • 50 Posts
    • 42 Thanks
    kram
    It would also be worth checking your credit report to see that everything is ok when your 0% deals come to an end.

    I hope you get things sorted.

    K
    • xmas_angel
    • By xmas_angel 23rd Sep 17, 9:41 AM
    • 5 Posts
    • 5 Thanks
    xmas_angel
    Ok so quick update, on to week 2 of living frugally and sticking to my 'cash only' budget. Limited ourselves to £150 a week for food, petrol etc. And over the course of 2 weeks have been able to save £80 to pay off towards the overdraft! A large portion of this saving is on groceries, cut my food spend in half to just under £50 a week. It wasn't greeted with much enthusiasm from the husband when I bought home the cheap pizza he doesn't like, but as I pointed out that we were over £40k in debt he'll eat the cheap pizza and damn well like it!!! Or he can have something healthier or already in the cupboard. I think having to use cash and actually see the impact of spending is helping and also by not being able to use our cards it's stopped the whole shopping online and worrying about it later. Anyway just wanted to post to say thanks for all your advice, I'm determined to stay on path and cut this debt to 0!!
    • Poppy3008
    • By Poppy3008 23rd Sep 17, 10:13 PM
    • 89 Posts
    • 421 Thanks
    Poppy3008
    We were paying the same in contents as you (also military family with now own home). I changed to a 'normal 'firm to cover buildings and general contents and kept the kit cover only with our old insurers (I think forces mutual) and it has come out wayyyyyy cheaper. We were paying same as you in contents plus separate buildings - we now pay £30 contents and buildings together plus 9.50 kit cover. Though I paid annually for the house this time as we have been here a year and saved specifically - never had to before! I know how you feel - it's hard having had that amazing amount of disposable income to then paying a mortgage etc. Plus council tax direct and water rates!! Once we moved in I started to put monthly amounts away to cover all the annual bills such as insurances ect. X
    • enthusiasticsaver
    • By enthusiasticsaver 23rd Sep 17, 10:28 PM
    • 4,265 Posts
    • 7,716 Thanks
    enthusiasticsaver
    There are some gaps in your soa as someone else pointed out on presents, entertainment and haircuts. Drawing out a weekly cash amount is a good way of keeping track of spends. Another way is to have separate pots of money so maybe the main current account for bills, a savings account for an emergency fund for unexpected expenses (essential), a savings account for annual bills such as insurances, car tax and service, Christmas and presents, holidays etc. You could also keep monthly discretionary income in a separate account for food, petrol, entertainment, personal expenditure.
    Countdown to early retirement on 21.12.17 3 months to go.
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