Soa

spoodz

My SOA:

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 1065
Partners monthly income after tax....... 300
Benefits................................ 652
Other income............................ 0
Total monthly income.................... 2017

Monthly Expense Details
Mortgage................................ 505
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 75
Electricity............................. 25
Gas..................................... 25
Oil..................................... 0
Water rates............................. 15
Telephone (land line)................... 25
Mobile phone............................ 20
TV Licence.............................. 12
Satellite/Cable TV...................... 19
Internet Services....................... 0
Groceries etc. ......................... 400
Clothing................................ 50
Petrol/diesel........................... 150
Road tax................................ 15.42
Car Insurance........................... 65
Car maintenance (including MOT)......... 30
Car parking............................. 0
Other travel............................ 65
Childcare/nursery....................... 40
Other child related expenses............ 70
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 13
Contents insurance...................... 15
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 80
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 50
Emergency fund.......................... 0
Total monthly expenses.................. 1784.42

Assets
Cash.................................... 0
House value (Gross)..................... 135000
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 136500

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 80000....(505)......5.2
Total secured debts........... 80000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Virgin card....................3200......55........16.9
Halifax card...................2200......46........13.9
M&S card.......................2300......47........20.9
BoS loan.......................10000.....155.......7.8
Total unsecured debts..........17700.....303.......-

Monthly Budget Summary
Total monthly income.................... 2,017
Expenses (including secured debts)....... 1,784.42
Available for debt repayments........... 232.58
Monthly UNsecured debt repayments....... 303
Surplus(deficit if negative)............ -70.42

Personal Balance Sheet Summary
Total assets (things you own)........... 136,500
Total Secured debt...................... -80,000
Total Unsecured debt.................... -17,700
Net Assets.............................. 38,800

I've tried to work everything out on a monthly basis.

We're a family of 5, 3 young children, 1 car.

Things that stand out for me are other child related expenses, this is the after school clubs the kids do, swimming lessons, ballet, football, and a £1 each weekly 'donation' that the school asks for.

Presents is another one that when worked out monthly is quite expensive. Includes parties that work out £100 a time (or more), maybe that could be one of the first things to go.

Another dear one is fueling the car. Its a 7 seater 4x4, very old thing, that I am trying to sort out running on veg oil (the previous owner did this successfully).

2 of the credit cards are supposed to be interest free till november and march, but on checking the last statement that is no longer the case. I'm going to ring them tonight to find out whats going on.

Travel is my train fare 3 days a week. I cycle the other 2. Hoping to cycle everyday once I'm fit enough (26 mile round trip).

I think thats it. I'm a fool for building up so much debt, much of it has come from spending on cards when we've run out of cash. Silly I know, but you can't not eat!

I've filled out a form on the CCCS website, but I dont know if I'm a severe enough case to be considered. I'm not in arrears with anything (yet), but i'm stacking up plenty of bank charges, and erroding away at my credit rating with late payment fees on creditcards. Applied for a 0% one recently for balance transfers and got turned down.

Horace

Hi and welcome.

The thing that sticks out for me is the grocery bill - it seems high, go over onto moneysaving oldstyle for tips on meal planning, they also give tips on how to reduce your grocery bill.

Instead of buying presents, how about making some - again plenty of ideas on the special occasions board.

I am sure someone else will come along with more tips on cutting down.

Jacks_xxx

:wave: Hiya sweetie,

I'm just on my way out of the door so I don't have time for a one of my big long posts covering everything individually but my approach boils down to this:

Challenge every penny - don't give anything a free ride. Cut your expenses down to the bare bones and make sure if you have to spend money on something that you are spending as little as you possibly can. (We sold both our cars, dumped our mobiles and sky, then after 3 months of struggling without a car bought a cheap to run old heap and after a year got sky back- when we thought we'd earned it by paying down our debts!)

Constantly ask yourself why you're spending money on *this* rather than paying off your debts.

And track your spending to get an accurate picture of where your money is going.

We all think we need to have cars and mobiles, buy people great presents, throw our kid amazing birthday parties and send them to lots of actrvities but really what we need is to pay our bills and build a secure financial future for our families.

Ooh and check out September's Grocery Challenge over on Moneysaving Old Style to get that grocery spend down.

Apologies if I sound too bossy

Gotta run!

Love Jacks xxx

RAS

Welcome

Some fairly brutal thoughts below.

spoodz wrote: »

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 1065
Partners monthly income after tax....... 300
Benefits................................ 652
Other income............................ 0
Total monthly income.................... 2017

Monthly Expense Details
Mortgage................................ 505
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 75
Electricity............................. 25
Gas..................................... 25
Oil..................................... 0
Water rates............................. 15
Telephone (land line)................... 25
Mobile phone............................ 20
TV Licence.............................. 12
Satellite/Cable TV...................... 19 - consider getting rid even if only for a year
Internet Services....................... 0
Groceries etc. ......................... 400 - way7 to high. Certainly aim for £200-300
Clothing................................ 50 - join www.freecycle.org and get them for free, car boot ansd charity shops.
Petrol/diesel........................... 150 - this is high.
Road tax................................ 15.42
Car Insurance........................... 65
Car maintenance (including MOT)......... 30
Car parking............................. 0
Other travel............................ 65 - what is this?
Childcare/nursery....................... 40
Other child related expenses............ 70 - you may need to cut back on this for a while
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 13
Contents insurance...................... 15
Life assurance ......................... 0 - you really do need this. Term insurance on younger people is quite cheap and given your finaical situation, it is a priority.
Other insurance......................... 0
Presents (birthday, christmas etc)...... 80 - reduce this as you cannot really afford it at the moment.
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 50 - again you need to consider house swaps and camping for the next year or so.
Emergency fund.......................... 0
Total monthly expenses.................. 1784.42

Assets
Cash.................................... 0
House value (Gross)..................... 135000
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 136500

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 80000....(505)......5.2
Total secured debts........... 80000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Virgin card....................3200......55........16.9
Halifax card...................2200......46........13.9
M&S card.......................2300......47........20.9 - this is the one to hit hard
BoS loan.......................10000.....155.......7.8
Total unsecured debts..........17700.....303.......-

Monthly Budget Summary
Total monthly income.................... 2,017
Expenses (including secured debts)....... 1,784.42
Available for debt repayments........... 232.58
Monthly UNsecured debt repayments....... 303
Surplus(deficit if negative)............ -70.42

Personal Balance Sheet Summary
Total assets (things you own)........... 136,500
Total Secured debt...................... -80,000
Total Unsecured debt.................... -17,700
Net Assets.............................. 38,800

This is doable, not only getting your budget in line but also making enough savings to clear the cards is a reasonable aim. You need your partner on-side to cut the expenditure. You are jointly living beyond your means but she nmmay not see it that way. Also can she work another day, or an evening when you are home?

I think that car is a deprecitating asset and would suggest you get shot ASAp. You only need a 5 seater, so get one.

If you tackle this now, you have a good chance of turning it round in a couple of years. if you leave it mch longer, you will struggle.

Merlot

Welcome to the board, everything I would have commented on has been said already. I am just going to back up what RAS says "life insurance is extremely important and vital, far more important than sky or mobiles, you need to ensure if anything ever happened to you or your other half that you could pay the mortgage/rent. A friend of mine died a number of years ago and she had four children, and no life insurance, her husband had to give up work for a period of time to look after the children, and he hit financial trouble with no life insurance or mortgage assurance cover. We all like to think it won't happen to us, but it could, and these two pieces of insurance along with car/home insurance is an absolute must.

Well done for posting your soa, its never easy seeing it in black and white, but you have made the first step into becoming debt free.


Merlot.x.

RAS

Hi

And if you read Martin's own story, you will find that his mother died whilst he was still at school. He very keen for people to get life insurance particularly if they have kids. it will only cost £10-20 per month and could make a world of diffference.

DoWhatULove-LoveWhatUDo

I have added my thoughts in colour below but I also wanted to stress that you are in a good position because your essentials mortgage and utilities bills are low in relation to your income and it's just lifestyle spensing that you need to get under control.

See this thread for reference:

http://forums.moneysavingexpert.com/showthread.html?t=1126491

spoodz wrote: »

My SOA:

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 1065
Partners monthly income after tax....... 300
Benefits................................ 652
Other income............................ 0
Total monthly income.................... 2017

Monthly Expense Details
Mortgage................................ 505
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 75
Electricity............................. 25
Gas..................................... 25
Oil..................................... 0
Water rates............................. 15
Telephone (land line)................... 25 The line rental is a fixed expense but the rest is calls which you can control
Mobile phone............................ 20 It's my opinion that this is not the best use of your resources.
TV Licence.............................. 12
Satellite/Cable TV...................... 19
Internet Services....................... 0
Groceries etc. ......................... 400 this amount can be significantly reduced by meal planning and buying less prepackaged food. Set a budget and stick to it.
Clothing................................ 50 This will have to be restricted to essentials only for a while sourced from eBay, charity shops and Freecycle
Petrol/diesel........................... 150
Road tax................................ 15.42
Car Insurance........................... 65
Car maintenance (including MOT)......... 30 £3125 a year is a very large and possibly unwise non essential expense at your level of debt
Car parking............................. 0
Other travel............................ 65
Childcare/nursery....................... 40
Other child related expenses............ 70 Classes and clubs are a luxury that your children must forgo for a while I think
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 13
Contents insurance...................... 15
Life assurance ......................... 0 It's really important that you get some of this it needn't cost more than your mobile phones and considerably less than your car or the kids ballet etc.
Other insurance......................... 0
Presents (birthday, christmas etc)...... 80 Start telling friends and family now that you will be cutting back in this area for the forseeable future.
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 50 If you have holiday savings i would urge you to redeploy those funds towards debt repayment.
Emergency fund.......................... 0
Total monthly expenses.................. 1784.42

Assets
Cash.................................... 0
House value (Gross)..................... 135000
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 136500

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 80000....(505)......5.2
Total secured debts........... 80000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Virgin card....................3200......55........16.9
Halifax card...................2200......46........13.9
M&S card.......................2300......47........20.9
BoS loan.......................10000.....155.......7.8
Total unsecured debts..........17700.....303.......-

Monthly Budget Summary
Total monthly income.................... 2,017
Expenses (including secured debts)....... 1,784.42
Available for debt repayments........... 232.58
Monthly UNsecured debt repayments....... 303
Surplus(deficit if negative)............ -70.42

Personal Balance Sheet Summary
Total assets (things you own)........... 136,500
Total Secured debt...................... -80,000
Total Unsecured debt.................... -17,700
Net Assets.............................. 38,800

spoodz

Thanks for all the replies.

Re life assurance, I have some sort of cover through work or my pension (civil servant) thats pays out should I die.

Re car, we were forced into living without for 6 weeks over the summer after an accident with an uninssured driver who disappeared (Spent £500 getting the car repaired after getting nothing from our 3rd party insurance, which has brought about my LBM). It was hell on earth. If we had a run of more than 3 hours without rain, using public transport was almost bareable. It just took twice as long, cost as much, and restricted where we could go. The accident damage makes the car difficult to sell and replace.

I agree with you on the groceries, tbh this was a guess, I have no idea what we spend on food, but I know we're not very organised when it comes to shopping, tends to be 'we need milk, bread and some fruit' on a sunday evening, when the only shop open is the overpriced mini mart.

We dont have any saving for holidays or birthdays or xmas, its the good old 'oh my god, its xmas next month and we havent bought anything'. same for holidays and birthdays. Every year i say to myself i'll do better, but here we are approaching xmas again and i've not bought a think, and have a bank balance of £12.32 (well, thats in the bottom of the £340 overdraft).

The clothing spend may be over estimated, and its one I need to tackle the wife about. To be fair she buys on ebay and in charity shops for her and the kids, but seems to be buying things a few times a week which soon adds up, and its not essential looking at their packed wardrobes.

Some of the kids clubs we are going to drop, and birthday/xmas spending was out of control last year.

Anyway, do you think I should be able to tackle this lot myself, or should I enlist the help of CCCS or CAB?

Has anyone had any success with contacting card companies and seeing if the interest rate can be reduced?

Jacks_xxx

Hi again my lovely :wave:

As one of the other posters said you have pretty low essential bills so I see no reason why you guys couldn't tackle this yourselves. I can see loads of wiggle room in your SOA. You have to start thinking differently though.

Add up your basic essential bills that you have no choice about - Mortgage, gas, leccy, water, tv licence and B&C insurance.

It comes to what? £750 or so? So you have £1300 a month that you have some choice in how you spend it.

Then see how cheap you can get those bills (apart from the mortgage) by using less or switching suppliers. Use Quidco to get cashback for switching.

Check out The Snowball for how to pay off your debts most effectively in interest order:
http://www.whatsthecost.com/snowball.aspx

Punch it all in based on what you are paying now then add say £200 to the pot available for debt replayment and see what a huge difference it makes. If that doesn't motivate you to control your finances rather than going with the flow then I don't know what will!

Then find out where all your money is going - so keeping receipts and running a spending diary is the way to go. Stop drawing out cash and pay everything by card the you have a reasonably good picture on your bank statement rather than just lots of cash withdrawals and no idea where it went.
We use www.spendingdiary.com for a more detailed breakdown.

We got lots of our interest frozen when we first had our lightbulb but it's a different financial climate today and your CC companies seem to be putting your interest up which is not a good sign. (I assume you haven't spent on a card that was meant to be just a 0% balance transfer?)

Regarding the car - if you still feel that you need one then could you part exchange it at a garage for a cheap to run little run around without spending any extra cash? Then only use it when necessary? It's good for kids to walk to school and if your wife isn't running them all over the place to after school activities and you don't need it for work then your useage will drop dramatically I should think.

Groceries can be delivered - which forces you to plan what you're going to need, reduces the need for wheels and cuts down on impulse purchases and pester power. You can usually get a code which will cover the delivery charge here:

http://forums.moneysavingexpert.com/showthread.html?t=1015057&page=8&highlight=tesco+codes

What helped us with the grocery spend was joining the Grocery challenge and opening a Housekeeping account. We pay in an amount that we thought ought to be enough for food toiletries cleaning products etc and if we buy these things then we use the card for this account and keep the receipt to show what we bought.

Clothes expenditure needs to stop completely for a while - no more charity shop or eBay bargains - and maybe the over flowing wardrobes could be auditted and some stuff sold on eBay or at carboot to start a Christmas fund??

Everyone's cutting back on Christmas this year, so resolve to do it for a as little dosh as possible and let everyone know well in advance. I bet there are plenty of people in your family and friends who are doing the same because of the credit crunch.

Little kids are just as happy with lego off Freecycle or second hand stuff from eBay and all adults should understand that your finacial security is more important than them ripping shiny paper off some over priced piece of tat in three seconds on one day of the year.

(Bah humbug! )

Ok I think that's enough from me for now.

Love Jacks xxx

findingmyfeet

hi there, just wanted to add agreed with what must people are suggesting, but a little thought on christmas- do you have any family members with kids older than yours?? my brother was in real trouble a few years ago( not common knowlegde amongst most of the family) my father told me in desparation wondering how he could help having little money himself. It was a couple of weeks before christmas, no gifts for the kids and they hadnt had new clothes for many a long month. I was straight in my kids room told em we were having a clear out for santas new stuff- most stuff had hardly been used and looked perfect and went through the clothing too ( again barely worn, they grow too quick to wear stuff out). I rang my bruv said i had had a clear out and was anything any good to him or i would take it to the charity shop. He literally snapped my hand off, came round later that day on his own and took the lot. Toys where wrapped for gifts and they had the clothes straight away. I felt good because i had helped and not cost me a penny, the kids missed nothing. Even now hes better off he still has the kids clothes when they have been out grown. So chin up, its a challenge and not the end of the world, just keep going and smile whenever you can, YOU CAN SORT IT.

Sorry for rambling on