Finally the penny has dropped

theHeckler_2

My wife and I are £75000 in debt, excluding my mortgage and it is only since my employer decided to freeze pay rises and cut salaries for this year that I faced up to our debt situation. Over the last 10 years we have misused credit cards, taken out consolidation loans and remortgaged to sort things out but have made the same stupid mistakes again. Now with a daughter to think of, reality has finally smacked us in the face and the situation is where our outgoings are going to be more than our incoming

Mortgage, utilities, insurance = £890
Food & Petrol = £400 (under budgeting here I think)

Loans (3 in total) = £1080
Northern Rock = £25,000
Lloyds TSB = £15,000
AA = £15,000

Interest free purchases = £150

Credit cards (5 in total) = £400
Lloyds TSB = £4,000
Barclaycard = £4,000
Post Office = £4,000
Egg = £4,000
Halifax = £4,000

Total outgoings = £2920

Total incoming = £2880

I am unsure where to go now because I don’t want additional loans (even if I could get one!) and bankruptcy would lose my house, which is the very last resort as I think it would break up my family. Only thing I could think of is an IVA, but still unsure of this.

Any advice that anyone could give would be most appreciated.

epsilondraconis

Well done for posting.

I think the first thing to do is to post a full statement of your affairs. Use the following link to put in all of your details and then copy it back into your thread.

If people are to help you, you need to ensure that everything is included and all of the amounts are as accurate as you can make them. Once you've done that, you'll begin to get lots of advice.

http://www.makesenseofcards.com/soacalc.html

shopaholictiedtheknot

Forgive me for being rude but your maths doesn't add up! Use the SOA calculator and then everyone will be able to see exactly what your problems are and hopefully help you

theHeckler_2

Household Information[/b]
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 1533
Partners monthly income after tax....... 1267
Benefits................................ 80
Other income............................ 0
Total monthly income.................... 2880
Monthly Expense Details
Mortgage................................ 410
Secured loan repayments................. 0
Hire Purchase (HP) repayments........... 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 95
Electricity............................. 59
Gas..................................... 40
Oil..................................... 0
Water rates............................. 35
Telephone (land line)................... 15
Mobile phone............................ 0
TV Licence.............................. 12
Satellite/Cable TV...................... 28
Internet Services....................... 10
Groceries etc. ......................... 300
Clothing................................ 50
Petrol/diesel........................... 120
Road tax................................ 40
Car Insurance........................... 70
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 30
Contents insurance...................... 15
Life assurance ......................... 35
Other insurance......................... 30
Presents (birthday, christmas etc)...... 50
Haircuts................................ 30
Entertainment........................... 20
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1514

Assets
Cash.................................... 0
House value (Gross)..................... 100000
Shares and bonds........................ 0
Car(s).................................. 15000
Other assets............................ 0
Total Assets............................ 115000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 75000....(410)......5
Total secured & HP debts...... 75000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Lloyd TSB Loan.................15000.....546.......11
Northern Rock Loan.............25000.....250.......15
AA Loan........................15000.....250.......9
Egg CC.........................4000......90........16.9
Barclaycard CC.................4000......75........12.4
Post OfficeCC..................4000......80........16.9
Halifax CC CC..................4000......70........15.9
Lloyds TSB CC..................4000......80........15.9
Total unsecured debts..........75000.....1441......-

Monthly Budget Summary
Total monthly income.................... 2,880
Expenses (including HP & secured debts). 1,514
Available for debt repayments........... 1,366
Monthly UNsecured debt repayments....... 1,441
Amount short for making debt repayments. -75
Personal Balance Sheet Summary
Total assets (things you own)........... 115,000
Total HP & Secured debt................. -75,000
Total Unsecured debt.................... -75,000
Net Assets.............................. -35,000
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.[/font]

lilian1977

theHeckler wrote: »

Household Information[/b]
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 1533
Partners monthly income after tax....... 1267
Benefits................................ 80
Other income............................ 0
Total monthly income.................... 2880
Monthly Expense Details
Mortgage................................ 410
Secured loan repayments................. 0
Hire Purchase (HP) repayments........... 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 95
Electricity............................. 59 - quite high, can you switch?
Gas..................................... 40 - quite high, can you switch?
Oil..................................... 0
Water rates............................. 35
Telephone (land line)................... 15
Mobile phone............................ 0 - no mobiles?
TV Licence.............................. 12
Satellite/Cable TV...................... 28 - do you need this?
Internet Services....................... 10
Groceries etc. ......................... 300 - very high, visit the OS board for meal planning ideas
Clothing................................ 50 - This can be cut right down using. Ebay and charity shops
Petrol/diesel........................... 120
Road tax................................ 40
Car Insurance........................... 70
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0 - no expenses for your child?
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 30
Contents insurance...................... 15
Life assurance ......................... 35
Other insurance......................... 30
Presents (birthday, christmas etc)...... 50 - very very high. Try the Gift Neutral challenge and visit the Boots thread for glitches.
Haircuts................................ 30 - get some clippers and go without for a while.
Entertainment........................... 20
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1514

Assets
Cash.................................... 0
House value (Gross)..................... 100000
Shares and bonds........................ 0
Car(s).................................. 15000
Other assets............................ 0
Total Assets............................ 115000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 75000....(410)......5
Total secured & HP debts...... 75000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Lloyd TSB Loan.................15000.....546.......11
Northern Rock Loan.............25000.....250.......15
AA Loan........................15000.....250.......9
Egg CC.........................4000......90........16.9
Barclaycard CC.................4000......75........12.4
Post OfficeCC..................4000......80........16.9
Halifax CC CC..................4000......70........15.9
Lloyds TSB CC..................4000......80........15.9
Total unsecured debts..........75000.....1441......-

Monthly Budget Summary
Total monthly income.................... 2,880
Expenses (including HP & secured debts). 1,514
Available for debt repayments........... 1,366
Monthly UNsecured debt repayments....... 1,441
Amount short for making debt repayments. -75
Personal Balance Sheet Summary
Total assets (things you own)........... 115,000
Total HP & Secured debt................. -75,000
Total Unsecured debt.................... -75,000
Net Assets.............................. -35,000
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.[/font]

Hope some of that is helpful x

webitha

the one thing that immediately jumps pout is the groceries, far too high you can quite easily halve that, i spend roghly £200 a month, inc husehold goods eg loo roll washing powder shampoo, deodrant etc for a family of 5 and we also have meat everyday (i live with a bunch of carnivores lol) and there is always fruit.
head over to the old style board, they are a bunch of very clever people

also £45 for B&C insurance?? you can get that a lot lower, (mine is £23 for both) and try to go through a cashback site, like quidco

mountainlioness

Hi there - am sure the regulars will be along shortly to dispense their usual expert help... I know it's not going to make a major dent on your debt but there does seem to be scope to cut your living expenses. Your gas, electric, water and groceries looked pretty high? Not sure what the current advice from MSE is on switching, but you should be able to cut usage. We borrowed a plug in meter thingie to test our appliances but it's mostly about getting into good habits I think :rolleyes:

The Old Stylers work miracles in terms of food bills - am sure you could halve your current spend though you could start with a less ambitious target. The downshift challenge does make a difference, as does meal planning (much less waste).

Freeview is a good replacement for a subscription...

I'm also a big fan of Freecycle, which might as well. We got loads of seedlings for our little veg patch last year, as well as free fruit, but also useful gadgets, storage, clothing etc.

The APRs on some of your CCs are quite high - not sure what your scope for switching is but there are some good 0%s out there (when we had to get a replacement car, we managed to put it on one!) which will give you some breathing space.

HTH and all the best

ML

theHeckler_2

Useful points Lilian1977

Sorry I did miss £100 outgoing on wife's catalogue. So deficit is bigger.

Electricity & gas - I am waiting for the latest bill to see if I owe them anything b4 considering a switch
No personal mobile, just company one
Groceries - normally budget £250 and find that difficult to keep to. Especially as I am in training & tend to eat a lot.
Satellite - tied in with a package contract so can't do anything on this for about 9 months
Clothing - this is on the optimistic side anyway
Child expenses - should have put something down as normally I count in with the groceries budget.
Present,etc - Don't normally budget anything and wait for the time, so probably bit optimistic here
Haircuts - this is for my wife so don't really have an idea how much it really costs so guess this could be reduced.

Some little changes that would help but still would be in deficit and depending on credit cards too much