Help and Advice needed please!

biggy123456789

Hi im 22 and have just been accepted on a mortgage with my girlfriend (also 22). I have outstanding debts as does she. What im after is a bit of help and advice on what to do and how to goet around it. The money we earn is enough to pay everything we owe but leaves us with next to nothing to live with.

A little about me first I have my own company and don't pay myself quite the same every month (usually between £1800 - £2000). I took a loan out through my dad 2 years ago and still have almost 3 years left to go the remaining balance is £7500. I also have a credit card with a balance of £4000 and the limit is £4400. The loan is being payed back at £250 a month and the credit card between £100 - £150 a month depending on income.

The mortgage is £780 a month plus council tax and utility bills its around £1100. my girlfriend earns around £1000 a month and also has a loan with a rough balance of £3500 left paying £225 a month and just over a year left to go.

We both have cars on finance mine @ £270 a month and hers @ £170 a month so as you can see things soon ad up, mobile phone bills, petrol, tv license, home phone, car insurance's, sofa (on finance), kitchen (on finance). we are usually left with around £200 - £250 between us a month which in my mind isnt enough to live when food has to be bought.

Can anyone advice me one what we could do please!?

Lula-Hula

Hi & welcome

First thing is to try to transfer the balance on your credit cards to get the best deal possible.

It would probably help you to look at 'snowballing' your debts - paying off the one with the highest interest rate first etc. Link : www.makesenseofcards.com. For help with budgeting you can fill one out online on the consumer credit counselling service website link : www.cccs.co.uk . If you want help in cutting down your grocery shopping I recommend a wander over to the moneysaving old style forum.

If you're happy to have the experts pick through your finances you could do an Statement of Affairs , sorry not sure about the link for that one .

There is a wealth of advice, warnings & support on this site, many challenges to join in to help keep your spending under control...feast & enjoy

Good luck

Lula x

SunderlandBlackCat

Hi Biggy

What lula said except the makesense of cards link is for the Satement of affairs. The snowballing calculator is at https://www.whatsthecost.com/snowball.aspx

biggy123456789

When I meant I have just been accepted I actually meant bought a house!! Thanks guys this is helping out just needed some guidance on where to go and how to do it could someone explain though the snowball effect?

SC01

Do you really need to buy a house???? There's all the other costs involved such as building insurance and life insurance plus any work that needs doing to it and general maintenance.

Are you renting or living at home at the moment? While it is nice to own your own place, it'll feel much better when you've cleared your other debts first. I assume you've had to save a deposit - why have you not used this money to clear your debts first?

Sorry if I sound harsh but having bought a house when I was younger and in debt, I know that it can get worse before it gets better and if you're already struggling to meet ends meet then it might not be the best idea!

Lula-Hula

SunderlandBlackCat wrote: »

Hi Biggy

What lula said except the makesense of cards link is for the Satement of affairs. The snowballing calculator is at www.whatsthecost.com/snowball.aspx

What a donut I am thanks for pointing that out SBC ; I'm off to top up my quinine levels now ...

lula x

biggy123456789

Im lucky enough to be given a deposit from a relative so thats not a worry for me. and as I have stated I do own the property. I understand everything you say and appreciate the comments but the trouble is whats done is done and I need to live with it and work away around it not dwell on what could have been.

SC01

Sorry - you must've posted at the same time but a bit quicker!

First step then definitely is an SOA. When I first sat and did mine properly I was amazed at how much money I wasted. You should both keep a spending diary too - it only has to be for a couple of weeks to give an indication of where the frittered money goes. Again, this will probably surprise and shock you - it did me!

You're in the right place for plenty of help though!

trancebabe

Yep - get your SOA up so we can have a look at the details

www.makesenseofcards.com

:0)

biggy123456789

Ok ill have ago at that then thanks for the help again guys

SunderlandBlackCat

biggy123456789 wrote: »

could someone explain though the snowball effect?

Basically you work out how much you can afford to pay off all your debts each month, then you order them by highest APR to lowest & only pay the minimum off all but the highest APR & throw the rest of the money at the highest APR.

This means that you are paying the minimum amount of interest each month so more of your money is going to reducing the overall balance.

Paying the same total amount each month the amount of interest you pay gets a little bit less & the amount being paid off the balance gets a little bit more.

It is usually the cheapest way to tackle your debts as it saves a lot of money being unnecessarily paid out in interest.