Why do I have to spend it like it grows on trees??

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Everyone's offered good advice (as usual!) so far!

I'd agree that you wouldn't need a DMP given your level of debt. A few adjustments to your spending habits will free up a lot of money that you didn't realise you have!

It would be worth looking at what 'frivolous' things you spend your money on - and by frivolous I mean anything that isn't a utility bill, rent or council tax. For example - do you really spend £45 a month getting your hair done?! What's this for? If it's colouring, you can do it yourself at home for around a fiver. If it's for the actual cut, bite the bullet and go longer between cuts or look out for student nights when they ask for models - sure it takes longer but they're always supervised!

Also do you really need to spend £30 a month on clothes? My weakness was clothes and shoes so I know how it feels but really, step away from the shops! Go through your wardrobe and really evaluate what you wear. If you haven't worn it in a year then you never will - put it on ebay.

I also agree with the set spends for the week. I currently have £30 a week, with any surplus rolled over to make up £30 for the next week and so on. It really does help focus you on what you have to buy and what you just want to buy.

Anyway, good luck and I hope that my rambling has helped a bit!

SkintNalsy

This is really great advice all. I don't feel so worried now and feel a lot more positive about sorting myself out!

Idiophreak

I kinda agree with clapton and hayley11...whether you move home or not, a DMP seems a bit OTT to me. You have around 3000 in debt and around 200/month to spend on it in your SOA - not the end of the world. Trimming things back (electricals and hairdressing) should be able to take you up to around 300/month to put towards the debt - so you'll be clear in under a year. Your only real problem, in the short term, is cashflow...You have the bulk of your repayments (455/513) resulting from a minority of your debt. (1050/3100)....it's only really the £1050 that's causing you problems - you should easily be able to cope if you were just repaying the main loan.

All you need to do, then, is deal with the 1050 - get another loan, a credit card, a loan from family, etc. You should be able to deal with this in 12 months for < £100/month - making your total repayments something like £150/month...manageable in your current SOA, *easily* manageable with a bit of cutting back - and before long, you'll be down to just paying the £58/month on your RBS loan.

Obviously, the hard part of this is just making sure you don't repeat the same cycle - and that's more tricky...:)

CarolynH

hayley11 wrote: »

Hi

You know i'm thinking of moving to Scotland, no water rates and nearly free prescriptions!

It's included in your Council tax - and council tax is a good bit higher to take this into account. So only useful if you are exempt from Council tax or have it paid for you.

Jesthar

Hello and welcome -and congratulations for asking for help before this got out of hand! :T

I agree with the last few posters - you don't need a DMP yet, just to learn how to budget a bit! You don't have much debt, and you can easily make some cutbacks to your lifestyle which will help you get back in control - hopefully for good!

Now, let's have a look:

SkintNalsy wrote: »

Here's my SOA (hope I did it right)!

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 1200
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1200

Monthly Expense Details
Mortgage................................ 0
Secured loan repayments................. 0
Rent.................................... 300
Management charge (leasehold property).. 0
Council tax............................. 100
Electricity............................. 40 - seems high, can you switch supplier and/or lower your useage?
Gas..................................... 40 - seems high, can you switch supplier and/or lower your useage?
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 40 - could you lower this/switch to a cheaper tarrif?
TV Licence.............................. 11
Satellite/Cable TV...................... 38 - any way to reduce this to the cheapest package available?
Internet Services....................... 0
Groceries etc. ......................... 120 - this is VERY high, I'm single and living on my own, eat VERY well, and only spend half this a month on food - without buying any Value food. Check the Old Style Moneysaving section of the boards for help and support with reducing your food bills
Clothing................................ 30 - you need to put this on hold for a bit
Petrol/diesel........................... 30
Road tax................................ 10
Car Insurance........................... 58
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 20
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 2.5
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 45 - you need to find a way to reduce this for a while
Entertainment........................... 100 - you need to put this on hold for a while
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1014.5

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 2500
Other assets............................ 0
Total Assets............................ 2500

No Secured Debt

Unsecured Debts
Description....................Debt......Monthly...APR
Provident Loan.................210.......15........0
Safeloans .....................240.......240.......0 :eek: is this a 'Payday' type loan - borrow for a month then pay it back with lots of interest? If so, you should try to not take this out again, or at least reduce the amount you borrow
Rent Arrears...................300.......100.......0 - this is a priority debt
RBS Personal Loan .............2050......58........0
Council Tax Arrears............300.......100.......0 - this is a priority debt
Total unsecured debts..........3100......513.......-

Monthly Budget Summary
Total monthly income.................... 1,200
Expenses (including secured debts)....... 1,014.5
Available for debt repayments........... 185.5
Monthly UNsecured debt repayments....... 513
Surplus(deficit if negative)............ -327.5

Personal Balance Sheet Summary
Total assets (things you own)........... 2,500
Total Secured debt...................... -0
Total Unsecured debt.................... -3,100
Net Assets.............................. -600

Created using the SOA calculator at www.makesenseofcards.com

First things first - if that 'Safeloan' is a Payday type instant loan, you need to bite the bullet and not take it out next month, as this is where most of your debt is coming from. The good news is that if you reduced your food bill by half, didn't get your hair cut, didn't spend on clothes and reduced your entertainment bill by 2/3rds or more, you'd be spending around £200 less instantly, and with a few other savings wouldn't need to take out that loan again at all.

Also, the rent and council tax arrears, your other big monthly payment debts, will these both paid off in three months time? If so, and you ditch the payday loan and live frugally for the next few months, once those are gone you will only have about £75 a month going out in debts, as opposed to the £500+ now, so you could probably evenmanage to stay on in your flat if you really don;t want to move back home. Just a thought, and it would take a lot of self disciplne, but I think you could do it.

Speaking of self disciplne, try keeping a spending diary. I have a spreadsheet I built myself which I use to keep track of everything I spend every month, sorted by categories, and it makes it really easy to work out where all my money has been going.

Anyway, I hope this helps - and keep smiling, you stand a very good chance of getting yourself out of this quickly on your own, if you are careful!

~Jes

hayley11

CarolynH wrote: »

It's included in your Council tax - and council tax is a good bit higher to take this into account. So only useful if you are exempt from Council tax or have it paid for you.

Ahhh that's okay then! I was thinking how unfair it was!! :rotfl:

SkintNalsy

Thanks for this. Yes, I do need to stop taking out payday loans. Its hard though as I end up borrowing to pay it back and its a vicious circle (as I'm sure you all know)!

I think I'm going to give the DMP a miss and try to struggle on for a while. Hopefully, my rent and council tax arrears will be paid off by January.

Jesthar

SkintNalsy wrote: »

Thanks for this. Yes, I do need to stop taking out payday loans. Its hard though as I end up borrowing to pay it back and its a vicious circle (as I'm sure you all know)!

I think I'm going to give the DMP a miss and try to struggle on for a while. Hopefully, my rent and council tax arrears will be paid off by January.

Skint,

Glad to hear this - as I said, if you can keep your mind firnly on not spending anything other than is necessary, you should be able to hold out until your arrears are paid off, and then you are left with very manageable debts.

As to the payday loans, the vicious circle is exactly what these extortioners are after, as it brings them sky high profits every month. :mad: The important thing is not to panic when you have to pay them back - it seems like a large lump sum, and it is, but it is also one you can manage without if you are careful.

When is the next payment due? If you can live very frugally until then and save as much extra money as you can, you could be able to pay them off without borrowing again - or at the very least only having to borrow a reduced amount, which you can then work towards saving to pay off over the next month and will be easier to clear. Once you have broken the cycle, you will find things much easier to deal with!

~Jes

(Land_of)_Maz

A really basic thing i do which stops my spending is having a post it on the inside of my diary which has all my definite outgoings written on it, and as each one is paid by DD or at Post office, i get a little bit of satisaction from scoring it off my list.... and sad as it is, the satisfaction is actually really motivational and seems to curb my spending at least until everything is paid off.... that way i ensure i leave enough money in my account to meet all DD's and stuff....

If you're of a mind to do spreadsheets n stuff then they can sometimes be a great thing, seeing the debt totals come down is a real incentive....

Yay for us scots and our free water and cheapie prescriptions! oh and dental check ups are free on the NHS too!!! - mind you, that could be everywhere couldn't it?

Hey to OP SkintNalsy, from Stonehaven, not a million miles away!

(Land_of)_Maz

also try www.spendingdiary.com it helps to see how those extra cappucinos, magazines etc really add up and run away with your cash.

you might also want to enter some challenges, i.e. have as many No spend days as possible every month, make £10 a day off Ebay/Amazon etc.... there are loads of good motivational tools on here when you get going.....