advice please

boltonangel

:eek: i have £12,300 debt at the moment (or thereabouts!)

you will need to get comfy for this!!!

..........

i have £1003.14 on barclaycard (11.9%) making payment of £50 - 80p/m, but adding an average of £100 in purchases p/m
£3265.57 on abbey mbna card on a 9mth 0% balance transfer, which has 8 mths remaining £80pm being thrown at that, obviously no purchases being made on that card
£8247.92 on tesco p/l at 6.5%, with a payment of £171 for another 4 and a half years

i also require £2k to install central heating - this is something that i do need, i coped all thru last winter without it and i can`t repeat it again. i have tried electric heaters and hot water bottles etc,but they don`t take the edge off. also the coldest room in the house is my 3 yr old son's room, which has black damp patches on the ceiling, which is obviously not that great, escpecially considering the house is only 10yrs old.

i have a mtge of £87.5k over 23yrs, 8 mths at the moment. my income is £13000, due to rise in jan (to roughly £14-15k) i am expecting bonuses of around £1k in jan (after tax and other deductions). my husband earns £22k, and puts £170 a week towards household bills.

i have cut down on any direct debits i can. my account is constantly overdrawn at the end of the month, and usually throughout, as bills go out monthly, all n my payday and hubby pays me weekly. this is why spending still continues on barclaycard. i have switched my current ac to first direct as their overdraft apr is less than rbs.

i am looking for a p/t job in the evenings, expecting minimum wage from this for about 10 hrs per week or so.

at the moment my outgoings outweigh my incomings. i have looked into a f/adv on my mtge, which is obviously not the best for overall interest . i would be borrowing an additional £15k over the remaining 23yrs 8 mths, and this would cost be £94 extra per mth (5.5%). the ££ would be used to pay my debts and get central heating. the £3k for my mbna card would be put into an instant access savings acc, from which i would make the minimum pymt, until the 0% rate ends, i will then repay it - hopefully earning a little credit interest.
after getting myself straight i will then overpay my mtge by an extra £100 p/m at least - which i will, cos i eventually want to move - this is important to us.

i am not sure if this is the best method.

please could you advise on any other solutions. :A

brummiebabe

The more experienced DFW will be around shortly. However, they'll initially ask for a SOA (Statement of Affairs) - you basically need to list ALL your outgoings, in detail (inc. bills, food shopping, insurance, childcare etc etc) they can then work with that to help you reduce your outgoings & sort out manageable debt repayments!! Best of luck with it all!!!!!

Magentasue

As said, you need to work out a budget that details ALL of your outgoings and look at how you cut them. Posting this isn't essential if you'd rather not but it does allow others to look at how you can make savings.

First thing to come to terms with is that your budget includes things like food and other day to day expenses. You pay yourself before you pay your debts. Your debts come out of what is left - that way you don't use your credit cards.

This is hard because there is every chance that you will have to pay less to your creditors and have your lines of credit cut. We debt-free-wannabes don't want this and fight against it but once you give in and accept it you can reduce your debt instead of increasing it.

So... first thing is a budget. Then you'll know how much you can afford on your debts.

Also ... how does your husband figure in this? You use 'I' all the way through as if the mortgage and debts are all yours but then mention that you have a husband who earns twice as much as you.

southernscouser

Hi boltonangel. :hello:

Have a look a this thread for all the information we will need then post back here!

http://forums.moneysavingexpert.com/showthread.html?t=107280

OK, I know it sounds obvious but you HAVE to change your lifestyle. As you have stated you are spending more than you earn which means you are going further into debt! To be honest you don't owe an awful lot (compared to me anyway ) and you have a good income between you and OH. Without jumping the gun and from the information you have given, to me it seems you are living beyond your means.

To help combat this I would suggest you start a spending diary. Note down every single penny you spend each day and on what! You will be amazed on how it all adds up! I was spending a minimum of £30p/m on the sodding drink/snack machines at work! :eek:

If I'm right you are taking in the region of £2,000 home p/m between you and hubby. Also your minimum payments to debts are around £300p/m. Mortgage, a rough guess £600p/m. That means you have £1,100 to live on!

It really is important you list all your outgoings and be prepared to make sacrificies. Does OH know about the debts? Are they joint or just yours? Does he have any? I know it's alot to answer but for us to help you best we need as much info as possible.

Also what is your credit rating like? Have you missed any/many payments? Any defaults? If it is good you could apply for a 0% card or low life of balance so you are paying less interest.

Would also like to say that putting debts on your mortgage is not always a good idea! Turning unsecured debt into secured and all that but we can advise better when we know the full picture.

Afraid we can't really offer any more advice until we have the facts and figures in front of us.

Good luck though. The more determined you are to becoming debt free the quicker it will happen. :j

johannamse

Been there got the t-shirt (and shorts and silly hat).

I know the secured seems very attractive to you now, but will not help in the long run. Better to face up to things NOW than put it all off. You say you outgoings exceed your incomings. If you posted all these details, I bet we could reverse this situation.

Please dont go done this route. In two years time, when you are in the same position again ("We NEEDED a car, for hubby to get to work and the rest is just food and general spending" = CRedit card debt £6k.), you will not be able to remortgage again.

boltonangel

:A thanks for your help, pls see my monthly dd's below;


02 mobile -£25 (jst over 6mths remaining, this is purely line rental only, i don`t go over my free mins, will be dropping it down to £15p/m on 01-12-05, which is the earliest i can do this)
mortgage - £566 have looked at switching, but as i have 3yrs remaining on fixed rate deal i would incur £1995 penalties!
Gas - £15, have just switched to scottish power, after checking u switch.
elec - £20, ditto
car ins - £43 - i am 21 so insurance is expensive. car is necessary.
life insurance - £10.28, switched recently
home ins- buildings, contents and acc damage - £18.81, this includes staff discount
cat insurance - £5.09 - considering cancelling this. advice ?
family income protection - pays a 'salary' to my son and remaining parent should either me or hubby die - this is important to me
bt bill for line rental - £11
one tel for calls - anything between £5 - 20 p/m, average £10
tv licence - £10.99
finance for bed - 0% deal, ends jun £47. when this finishes a similar deal for a couch starts, same price fr 2 years.
water-£10.11
council tax - £110
tesco personal loan - £171
broadband - £14.99

---

other expenses per mth

petrol - £90
nursery fee's - £60, although this will be free in jan when i get vouchers .
food - £200, this includes napppies, wipes, shampoo etc.

lunches - £8 pr week. i will be making my own though - i also spend an extra £5 on coke etc per week, again, i will be cutting down on this by buying a bottle of cordial for work.

---

i have bought all but 2 xmas pressies, and have an overdraft of £528 at the moment. with £810 of credits to come in from hubby, tax credit and chb. £191 of dd's yet to leave. credit card balances - same as mentioned earlier in this post. oh and pymts to credit cards yet to be made, i expect this to be £150.


£1000 bonuses expected from work in the new year.
can anyone help?

hobo28

Does your husband contribute equally to the bills? According to my quick calculations, you have just over £2k income per month and only £1500 outgoings. Therefore it sounds like its overspending which has resulted in your current debt.

How much do you spend on socialising/luxury items such as going out or smoking etc.

I would suggest a good start would be to cut up the credit cards and switch to spending on debit cards. Its all too tempting to spend on a credit card. I do it myself, I promise I'll pay it off the instant I get home but then I forget and get a nasty surprise at the end of the month.

Don't get a secured loan. It will turn out to be a noose around your neck.

paint

hobo28 wrote:

Does your husband contribute equally to the bills?

My first instinct is also to ask this question as it is fundamental I think to the long term issue of whether you will remain in debt or get out of it.

He should be contributing AT LEAST 50% to household expenduture, and in all fairness, more should his income be more than yous (i.e. in proportion to his income).

Please could you clarify so that a complete picture of your household income and expenditure can be gleaned?

boltonangel

husband has his own personal loan for £100p/m, plus gets his petrol £120p/m, car insurance £70p/m and mobile £20 out of his wages.
he is also on a slightly higher tax code at the moment due to a working family tax credit f*ck up when we first started claiming - back then it was credited into his wages and they say they didn`t tax him enough. he also pays high contributions to his pension - we have enquired about reducing his voluntary contributions, but his company say that he can`t unless he leaves the scheme. which he isn`t going to do as it is a final salary pension.
we don`t smoke, and don`t drink. we occasionally get a takeaway or a meal out , i estimate this costs £25p/m, again we have cut back on this, we havent stopped though, because i don`t want to cut every treat out of our budget, we now spend £10p/m on one takeaway. i have my eyebrows waxed once a mth, costing £5, i have tried waxing them myself, but that was a complete disaster!!! i used to have them done twice a mth, but i know pluck inbetween. i have my haircut an average of twice a year, and this is at the local college, i have checked for the eyebrows, but i don`t save any ££ on that.

hubby gives me £175 towards bills. after tax and deductions i take an average of £700 home p/m

Magentasue

Maybe ...

Have separate accounts - have account 1 for bills. All household and childcare expenses go out of this (you and OH contribute proportions of your salaries). Then you are left with what you have to spend/repay your debts. If you and OH share food etc shopping proportionally you would then know how much you have for debt repayment and non essentials.

When I say proportionally I mean if you earn £13000 and he earns £22000, you should be contributing 37% of and he should be contributing 63% into your household expenses account. Feel free to correct my maths - it's getting late!

Dora_the_Explorer_5

Hope this helps - you can save on your phone bills by switching to a cheap pay as you go mobile and make sure you use it for emergencies only and switch from onetel to 1889. Make your own lunches for work and replace coke and cordial with tap water - it's healthier anyway, or if you can't face it take your own coffee/tbags/milk/sugar to work and blag hot water. Personally I'd take a chance on cancelling the cat insurance. This all adds up to about £82 pm, less your makings for lunch and 3p total for each 1889 phone call you make. See if you can stop making outgoing calls on your mobile - that's always a big saving. Does you OH pay half the mortgage? Good luck.