Am I doing the right thing?

StartingAgainKayla70

Hi

Thanks for all your time and information

Cant get rid of me mobil as I am stuck for another 18 months in contract
I have reduced my sky package, but as me and hubby are stuck in the house thats our only enjoyment.
Thought about getting rid of my car, and getting something cheaper but it does need to be safe as I have children, but that is an option.
The endownment is a savings plan, as we have a fixed repayment mortgage and we tried to freeze it but they said no, so we didnt want to loose out on that.

I shall look again later at all your suggestions after I have done the school run.

THANKS AGAIN FOR ALL YOUR HELP

Magentasue

I'm glad you're going to consider changes - it's hard. The easiest thing is to say 'Well yes, that would save money but I NEED a mobile/expensive car/savings ... etc'.

The truth is you cannot afford them. I've never had a car 'younger'than ten years old and my children are still here! The interest you're getting onyour savings is being eaten away by the interest you're paying on your loan. You can afford to save when your debt is paid.

You'll live without Sky - if my teenagers can, so can you.

StartingAgainKayla70

Magentasue wrote:

I'm glad you're going to consider changes - it's hard. The easiest thing is to say 'Well yes, that would save money but I NEED a mobile/expensive car/savings ... etc'.

The truth is you cannot afford them. I've never had a car 'younger'than ten years old and my children are still here! The interest you're getting onyour savings is being eaten away by the interest you're paying on your loan. You can afford to save when your debt is paid.

You'll live without Sky - if my teenagers can, so can you.

I know your right, I shall sit down with hubby and go through everything tonight, feels like its never ending and the most stupidist thing of all, is that hes on such good money yet we are always skint, like someone said or was it you, We live beyond our means and your right we do, so tonight I am determind to buckle down and get that debt sorted.

Thanks again for all your help and thats goes to everyone who has posted on this thread. Thank you :beer:

Magentasue

Well done!

Good luck with your plan!

black-saturn

I've found the ones who earn the most money are always the ones most in debt. Like what they get isnt enough for them!!

Could there be a possibility to get rid of the car altogether? I paid off £4,000 debt in a year which doesn't sound like much until I tell you I'm on an income of £150 per week and I have 2 children. I got rid of the car and went on a pay as you go mobile. In hindsight I think I could have given up the mobile too. Remember 10 years ago when no one had a mobile? Well why do we all need one now? You need to live as if you are unemployed until the debt gets paid off.

tattooed_lady

Hiya, can I ask why the life assurance is SO high? Is that a yearly figure?? I pay £18 a month to cover 2 adults for £80,000 for 20 years.

StartingAgainKayla70

ruyareece wrote:

Hiya, can I ask why the life assurance is SO high? Is that a yearly figure?? I pay £18 a month to cover 2 adults for £80,000 for 20 years.

Sorry Life Assurance (mortgage protection) is for our mortgage if any of us die it will pay out £250k our mortgage is £147k.

System

Magentasue wrote:

I'm glad you're going to consider changes - it's hard. The easiest thing is to say 'Well yes, that would save money but I NEED a mobile/expensive car/savings ... etc'.

The truth is you cannot afford them.

Totally agree. I think you have to go thru a process of realising you can't have everything you want unless you've got the cash to pay for it. Otherwise, you're just falling for the "Have it now - Don't worry about the repayments" con.

Michaela - think you still need to detail absolutely everything you spend money on - do you keep a cashbook or cash diary? As soon as you have a "to the penny" breakdown of your spending, you'll be able to identify where you should cut back.

You'd be mad to move a debt from a 0% Credit Card to a Consolidated Loan - save yourself the trouble and just burn those £20 notes at home instead! Or you could throw the money out of the window!

It may be an idea to investigate getting a better deal on your £10k loan - but sadly alot of loan agreements have the majority of the interest paid off at the start of the loan. How long have you had the loan? If it's relatively new then you may genuinely save some money shopping around for a better interest rate.

Other thoughts:-

What's the interest rate on your overdraft? This may actually be a higher rate than your loan and you should try to put every last penny into reducing the overdraft.

Your Next catalogue - again what's the interest rate on this? And what's the total outstanding debt as that should be included with your loan, credit card and overdraft in your list of creditors. Catalogue's usually have exorbitant interest rates. I'd look to clearing this debt off. Do you have a Next Clearance shop near you - alot of the stock in there is half price.

Sky - As everyone says, get rid of it. It's £200 a year that could go to paying off your overdraft. You and hubby could forego getting each other a Xmas present and put the cash to a Freeview box instead. Also, alot of Council libraries have DVD sections now, so you shouldn't be short of something to watch.

Newspapers - You don't need papers or magazines - they should be seen as a luxury. Check the tv and internet news if you want to hear the latest news. (This will admittedly only save you a few quid a week, but again, it's money you can then use to attack that overdraft.)

If you've got kids, do they have any old clothes/toys etc that could be sold on ebay?

Final thought - Does your £400 include all the working family benefits that you're entitled to? Haven't a clue how much these are, but MSE forums has a dedicated "Families" forum (somewhere!).

Hope some of the above helps.

Dave

macca64

To reduce your overdraft interest and fees - Open an A&L current account and get 0% for 12 months. Open a new account and you get £50, which can be used to pay off your debt. Also people on the referrals board will give you some of their £50 if they refer you.

Personally think moving the credit card debt to a loan is a bad idea, use 0% deals on the credit cards to keep the interest on this to nil.

Life insurance - check to make sure you've got the best deal. Cavendish Online are pretty good, otherwise see the links in the articles on this site.

Can't think of anything alse that other people havn't mentioned already.

StartingAgainKayla70

[
Michaela - think you still need to detail absolutely everything you spend money on - do you keep a cashbook or cash diary? As soon as you have a "to the penny" breakdown of your spending, you'll be able to identify where you should cut back.

You'd be mad to move a debt from a 0% Credit Card to a Consolidated Loan - save yourself the trouble and just burn those £20 notes at home instead! Or you could throw the money out of the window!

Hi ya

Yep decided not to move the debt from my 0% credit card.

As soon as we get paid I am going to list everything I spend to the penny and see whats going on.

Thanks again to you all, its great that people are so helpful.

THANKS