Fed p with debt - going to sort it!

bozbear

When I married my husband I knew he came with debt due to a messy divorce. However he had a good income and although he had arrears he managed to raise some capital to pay off some arrears and sort some of his debt out. However he still has about 25k of unsecured debt. I have never been good with money and have always had debts!!! I have been chasing my tail for the last ten years,

When I went on maternity leave in February and we went down to one wage and SMP and then had to move to a bigger house - babies come with a lot of stuff!!! We managed to get ourselves into arrears further... I then have been avoiding phone calls etc...

I have now decided that I am fed up with us being in debt and I want to give my son a good start to his life and save him enough money for his future. And so I am due to return to work next week (only three days to start with) and I intend to get us debt free...

I am not looking for someone to tell us how to do it! I know what we need to do - however I would love help and support and somewhere to log my progress to keep us on track.

I called CCCS last week and have my full interview with them on Friday. They say as we have no joint accounts or debts our debt can be dealt with seperately and so I have prepared two budgets (we dont share finances! My choice!) and wondered what you all think...

Husband:

Income: £1800

Rent: £300 (he pays 2/3rds)
Electric: £30
Gas: £30
Council Tax: £95
Contents Insurance: £10
Car Insurance: £50 (both cars)
Petrol: £100
Phone Contract: £40
Gym Membership: £20
Water: £35
Food (his share): £100

Total: £810

Surplus: £990

Debts:

HSBC £15000 Managed Loan Is in arrears and they keep writing to him and offerig F&F it gets less evry time the last one was £9000. I need to write to them and see what they will accept? And where we are with this at the moment.

Capital Bank £8000 in arrears with a Debt collector who are going to pass it back to Capital Bank. They will not speak to us until it is passed back and he will not speak to us until he has passed it back. But I spoke to their customer services manager in the collectin department at Bank of Scotland and he suggested £200 per month for 5 months to catch up with the arrears and then back to the normal £105 payment per month. He said to write to them and send a cheque and he couldnt see that they wouldn't cash it in todays climate. (will be paid off in just over 3 years if we maintain £200 per month)

Car HP £5994 remaining paying £333 per month.

So without HSBC that leaves a £447 surplus. To pay HSBC and have living expenses. Will offer HSBC £200 per month.

My Wages for three days will be approx: £800 per month
Child Tax Credits of £520
Child Benefit of £75

Total: £1395

My Rent Share: £150
TV Licence: £15
Phone Contract: £20
Phone & Broadband: £40
Food My Share: £120
TopUp TV: £15
GymL £20
Petrol: £100
Childcare: £400

Total: £880

Surplus: £515

Debts: Barclaycard (defaulted) Agreed £50 per month
Capital One £400 going to pay £50 per month
Welcome Finance £2000 Payments £100 per month

Total Repayments £200
Debt Free 3 years

Leaves £315 surplus.

Have I missed anything. Is there anywhere I can cut back>

CLAPTON

first thing is to work out real budgets...
currently you show massive surpluses but are struggling.
but e.g. you have two cars but spend nothing on car tax, MOT, RAC/AA, not hing on services, never buy as much as a wiper blade...
xmas is coming but you have nothing there for extra xmas expenses or birthdays... you have a baby but never spend anything on it ... no clothes, socialising, haircuts , takeaways

1. try this budget planner
http://www.makesenseofcards.com/soacalc.html

2. start keeping spending diaries, where you write down everything you spend ... often quite an eye opener

then redo the budget and see where you are then

bozbear

THANKS FOR THAT

WE STILL HAVE A GOOD SURPLUS SO I THINK WE WILL INCREASE PAYMENTS TO GET STUFF PAID QUICKER.
Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 900
Partners monthly income after tax....... 1800
Benefits................................ 480
Other income............................ 0
Total monthly income.................... 3180

Monthly Expense Details
Mortgage................................ 0
Secured loan repayments................. 0
Rent.................................... 450
Management charge (leasehold property).. 0
Council tax............................. 100
Electricity............................. 30
Gas..................................... 30
Oil..................................... 0
Water rates............................. 35
Telephone (land line)................... 20
Mobile phone............................ 50
TV Licence.............................. 20
Satellite/Cable TV...................... 0
Internet Services....................... 20
Groceries etc. ......................... 200
Clothing................................ 50
Petrol/diesel........................... 200
Road tax................................ 10
Car Insurance........................... 25
Car maintenance (including MOT)......... 10
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 320
Other child related expenses............ 50
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 10
Life assurance ......................... 15
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 20
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 20
Total monthly expenses.................. 1755

Assets
Cash.................................... 1500
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 1000
Other assets............................ 0
Total Assets............................ 2500

No Secured Debt

Unsecured Debts
Description....................Debt......Monthly...APR
Welcome .......................2000......100.......22
HSBC...........................15000.....150.......0
CAPITAL BANK...................8000......105.......18
CAR HP.........................5500......333.......0
CAPITAL ONE....................400.......20........0
BARCLAYCARD....................1600......50........0
Total unsecured debts..........32500.....758.......-

Monthly Budget Summary
Total monthly income.................... 3,180
Expenses (including secured debts)....... 1,755
Available for debt repayments........... 1,425
Monthly UNsecured debt repayments....... 758
Surplus(deficit if negative)............ 667

Personal Balance Sheet Summary
Total assets (things you own)........... 2,500
Total Secured debt...................... -0
Total Unsecured debt.................... -32,500
Net Assets.............................. -30,000

Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.

======== Enter any other useful information below ========

e.g. the number of adults & children in the household, the number

of cars included in the SOA or anything else that may be useful.Would we be better to increase monthly payments or to save and offer F&F settlements? whilst keeping mnimum payments?

I think we struggle as we have no real grip on where our money goes and i think the spending diaries is a great idea.