DMP or hang on in there?

LeeSouthEast

Cheshire_Cat wrote: »

ok have done the SOA as advised.

hope this helps

thanks!


Household Information[/b]
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 2600
Partners monthly income after tax....... 1300
Benefits................................ 120
Other income............................ 0
Total monthly income.................... 4020
Monthly Expense Details
Mortgage................................ 1077
Secured/HP loan repayments.............. 168
Rent.................................... 0
Management charge (leasehold property).. 25
Council tax............................. 143
Electricity............................. 50
Gas..................................... 60 - this is quite high for this time of year
Oil..................................... 0
Water rates............................. 55 - this is very high?
Telephone (land line)................... 0
Mobile phone............................ 25
TV Licence.............................. 11.75
Satellite/Cable TV...................... 35
Internet Services....................... 0
Groceries etc. ......................... 300 - Could shave a bit. Check OldStyle board.
Clothing................................ 20 - Put on hold. No more new clothes.
Petrol/diesel........................... 220 - Change driving style + empty boot?
Road tax................................ 33
Car Insurance........................... 66
Car maintenance (including MOT)......... 33
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 850 - Does your employer do vouchers?
Other child related expenses............ 50
Medical (prescriptions, dentist etc).... 2
Pet insurance/vet bills................. 0
Buildings insurance..................... 22.62 - does this include contents? Hope so!
Contents insurance...................... 0 - ^^^
Life assurance ......................... 13.75
Other insurance......................... 0
Presents (birthday, christmas etc)...... 67 - No more presents.
Haircuts................................ 20
Entertainment........................... 100 - What is this for? This is £1,200 a year.
Holiday................................. 166 - Already booked? If not, you can't afford it.
Emergency fund.......................... 0 - You need something here.
(Unnamed monthly expense)............... 0
petty cash.............................. 50
union subs.............................. 25
gym/squash.............................. 50 - Contract? If not, cancel. You can't afford.
Total monthly expenses.................. 3738.12

Assets
Cash.................................... 0
House value (Gross)..................... 180000
Shares and bonds........................ 0
Car(s).................................. 13000
Other assets............................ 0
Total Assets............................ 193000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 167881...(1077).....5.39
Hire Purchase (HP) debt ...... 7667.5...(168)......10.4
Total secured & HP debts...... 175548.5..-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
loan ..........................7733.85...160.......9.85
loan...........................7226.36...329.......6.1
overdraft 1....................5300......60........18
overdraft 3....................400.......6.........18
overdraft 2....................1000......15........18
Total unsecured debts..........21660.21..570.......-

Monthly Budget Summary
Total monthly income.................... 4,020
Expenses (including HP & secured debts). 3,738.12
Available for debt repayments........... 281.88
Monthly UNsecured debt repayments....... 570
Amount short for making debt repayments. -288.12
Personal Balance Sheet Summary
Total assets (things you own)........... 193,000
Total HP & Secured debt................. -175,548.5
Total Unsecured debt.................... -21,660.21
Net Assets.............................. 3,458.79

Hi

You actually have loads of scope here for making savings. You are spending nearly £300 more than you earn every month, adding over £3,400 to your debt each year. The good news is, with some simple tweaks and frugal living you can beat this.

My comments in the SOA are blunt but that's to keep the layout. Don't take offence.

Lee.

Cheshire_Cat

cheers for constructive reply

definately some things i can look at there - will be starting the childcare voucher scheme but not sure how much that will save till next month.


gas is an average for the year based on my usage (ive just switched again)

petrol is linked to travelling a long way - no boy racer here!

the holiday fund is there as an added bonus - may not be possible to do anything

UPDATE - looks like i can raise £5k+ for one car and inlaws car is available for 1.8k (£100 per month for 18 months)

the 5k can pay most overdraft and would leave perhaps £700 to pay off (but save around £70 a month in interest)

coupled with the £320 saved from moving to interest only mortgage for a while this could free up enough.

Only worry would be keeping the mortgage owed high with only paying off interest. would hate to be in a position where im close or in negative equity with no bargaining power for a mortgage.

should i shelve the dmp? (have filled in the CCS one and am awaiting my pack)
should i move mortgage to interest only for 2 years? (loan of £330 paid off and £380 of nursery fees saved by then)

thanks once again

LeeSouthEast

I think the problem is you might not get accepted onto a DMP, and it'd shred your credit rating. You have the room to get out of this on your own; it just takes the determination to do it and change your lifestyle.

Your miles: is it job-related? Do they pay mileage? Can you get tax relief on it? Downsize your car? My 2003 diesel ford focus averages 67.3mpg and despite doing nearly 1,350 miles a month, I rarely spend more than £100 on diesel.

Cheshire_Cat

yeah the car im changing is a gas guzzling 4x4 which will leave me with a couple of astras.

its a 44mile round trip for me to work - im hoping that petrol will be under £200 for both cars but dont want to under budget it.

i'm a teacher so no chance of getting milegae paid (unless its work related ie: above and beyond travelling to and from home)

just done another SOA (see below)

Does this seem realistic?

If so, it seems the way to go

Just need the interest only for 2 years and the car to sell for the 5k i think it should

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 2600
Partners monthly income after tax....... 1300
Benefits................................ 122
Other income............................ 0
Total monthly income.................... 4022
Monthly Expense Details
Mortgage................................ 700
Secured/HP loan repayments.............. 236
Rent.................................... 0
Management charge (leasehold property).. 25
Council tax............................. 143
Electricity............................. 50
Gas..................................... 60
Oil..................................... 0
Water rates............................. 55
Telephone (land line)................... 0
Mobile phone............................ 25
TV Licence.............................. 11.75
Satellite/Cable TV...................... 31
Internet Services....................... 0
Groceries etc. ......................... 300
Clothing................................ 0
Petrol/diesel........................... 220
Road tax................................ 33
Car Insurance........................... 65
Car maintenance (including MOT)......... 33
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 840
Other child related expenses............ 20
Medical (prescriptions, dentist etc).... 5
Pet insurance/vet bills................. 0
Buildings insurance..................... 22
Contents insurance...................... 0
Life assurance ......................... 13
Other insurance......................... 0
Presents (birthday, christmas etc)...... 66
Haircuts................................ 20
Entertainment........................... 100
Holiday................................. 166
Emergency fund.......................... 50
keith car............................... 100
petty cash.............................. 20
union subs.............................. 25
gym/squash.............................. 50
Total monthly expenses.................. 3484.75

Assets
Cash.................................... 0
House value (Gross)..................... 180000
Shares and bonds........................ 0
Car(s).................................. 9000
Other assets............................ 0
Total Assets............................ 189000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 158000...(700)......5.39
Secured Debt.................. 12000....(50).......3.49
Hire Purchase (HP) debt ...... 7667.....(186)......10.4
Total secured & HP debts...... 177667....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
loan...........................7226......328.......6.1
loan 2.........................7733......149.......9.85
overdraft......................700.......60........18
Total unsecured debts..........15659.....537.......-

Monthly Budget Summary
Total monthly income.................... 4,022
Expenses (including HP & secured debts). 3,484.75
Available for debt repayments........... 537.25
Monthly UNsecured debt repayments....... 537
Amount left after debt repayments....... 0.25
Personal Balance Sheet Summary
Total assets (things you own)........... 189,000
Total HP & Secured debt................. -177,667
Total Unsecured debt.................... -15,659
Net Assets.............................. 3,341

gizmo111

You can still reduce your outgoings and pay more off the debts to clear them - forget holidays and expensive entertainment until you are debt free, then you cna have holidays and expensive presents and overpay your mortgage.

GeorgeUK

I notice that although you have loans and overdrafts, you don't have any credit cards. Have you consolidated previous debts and added more debt? Getting out of debt is not just about tightening the belt unfortunately - it means a lifestyle change and while you may be able to make inroads towards getting rid of some of the debt, unless you are comitted to the lifestyle change, the problem will just repeat itself.

I know you've already answered most of these points, but i'll just go through your SOA.
Mortgage................................ 1077
How long could you go interest only and what impact would it have on your debt/repayments?

Council tax............................. 143
If paying over 10 months, can you ask to pay it over 12?

Electricity............................. 50
Gas..................................... 60
These are a little pricey - did you use the comparison sites to get the best deal? Check to see if you have any credit with any of these companies and inform them of your meter readings to make sure their bill estimates are accurate. Make sure you turn off appliances rather than leaving them on standby.

Water rates............................. 55
Are you metered? Do you have a water hipo or anything to save on water usage?

Mobile phone............................ 25
PAYG?

Telephone (land line)................... 0
Satellite/Cable TV...................... 35
Internet Services....................... 0
Is this a package deal?

Groceries etc. ......................... 300
Have you moved down a brand (shops own?). Look at the old style board for meal plan ideas and cooking in bulk.

Petrol/diesel........................... 220
Is there a cheaper alternative - train/bus?

Childcare/nursery....................... 850
Can any family members look after them for a day a week?

Car Insurance........................... 66
Buildings insurance..................... 22.62
Contents insurance...................... 0
Life assurance ......................... 13.75
Again, i'd look at the comparison sites (uswitch, moneysupermarket)

Holiday................................. 166
petty cash.............................. 50
gym/squash.............................. 50
Can't really afford these - how about a UK holiday?

Have you managed to maintain all your repayments so far? If so you may be able to get some 0% creit cards to do a 'super balance transfer' or money transfer. Only a few credit cards allow money transfers as part of their 0% promotion (such as Virgin), but if you can get it it should be 0% for 16 months and the minimum monthly payment is the greater of £25 or 1%. This isn't too different from your current overdraft payments but should at least get the balances decreasing.

Cheshire_Cat

"It doesn't make any sense budgeting for an emergency fund when your overdraft is in the red"


good point

same about holiday really - the money budgeted for that can go towards reducing the overdraft

i think i will save about £70 a month with childcare vouchers - and i think from easter with child places for 3 year olds that might save about £100 a month.

also just checked and child benefit is 132 a month with working tax credit £60 a month until xmas and then £12 a month from jan.

theres a few things ive missed but clearly as some of you will point out ive plenty of scope to budget and reign it all in.

cheers

any other advice welcome

Cheshire_Cat

GeorgeUK wrote: »

I notice that although you have loans and overdrafts, you don't have any credit cards. Have you consolidated previous debts and added more debt? Getting out of debt is not just about tightening the belt unfortunately - it means a lifestyle change and while you may be able to make inroads towards getting rid of some of the debt, unless you are comitted to the lifestyle change, the problem will just repeat itself.

I know you've already answered most of these points, but i'll just go through your SOA.
Mortgage................................ 1077
How long could you go interest only and what impact would it have on your debt/repayments?

Council tax............................. 143
If paying over 10 months, can you ask to pay it over 12?

Electricity............................. 50
Gas..................................... 60
These are a little pricey - did you use the comparison sites to get the best deal? Check to see if you have any credit with any of these companies and inform them of your meter readings to make sure their bill estimates are accurate. Make sure you turn off appliances rather than leaving them on standby.

Water rates............................. 55
Are you metered? Do you have a water hipo or anything to save on water usage?

Mobile phone............................ 25
PAYG?

Telephone (land line)................... 0
Satellite/Cable TV...................... 35
Internet Services....................... 0
Is this a package deal?

Groceries etc. ......................... 300
Have you moved down a brand (shops own?). Look at the old style board for meal plan ideas and cooking in bulk.

Petrol/diesel........................... 220
Is there a cheaper alternative - train/bus?

Childcare/nursery....................... 850
Can any family members look after them for a day a week?

Car Insurance........................... 66
Buildings insurance..................... 22.62
Contents insurance...................... 0
Life assurance ......................... 13.75
Again, i'd look at the comparison sites (uswitch, moneysupermarket)

Holiday................................. 166
petty cash.............................. 50
gym/squash.............................. 50
Can't really afford these - how about a UK holiday?

Have you managed to maintain all your repayments so far? If so you may be able to get some 0% creit cards to do a 'super balance transfer' or money transfer. Only a few credit cards allow money transfers as part of their 0% promotion (such as Virgin), but if you can get it it should be 0% for 16 months and the minimum monthly payment is the greater of £25 or 1%. This isn't too different from your current overdraft payments but should at least get the balances decreasing.

yeah in the past thats what we did with credit cards - 2 years ago was last time.

the water usage is about £40 but we moved into a new build house and stupidly didnt set up the water payments therefore i'm paying back - was £82 p/m till the other day.

car insurance is for 2 cars so good deals imo

the sky deal includes phone line rental

the mobile phone £25 is for 2 phones - a contracy for £15 which includes home bband and an estimate of a £10 paygo mobile.

i can go at least 12 months interest only and then move to another provider. only worry would be how much of the house's value i'd be borrowing (more than 90% of the value i imagine)

just used a comparison site for gas and elec so waiting on setting up ddebits but based on estimated savings i've reduced current payments to reflect.

childcare - unfortunately unforseen family ill health changed our plans with childcare


i hope we can cut groceries down but it will take a few months to get this budget right - just doen a week's online shop for £65 with £20 discount codes so a positive start there!

holiday i think will just be surplus money we save and will initially be used for the overdraft.

have heard about super transfers but always thought there was a % transfer charge - if i sell the car for 5k then overdraft should be cleared within 6 months

Numpty_Monkey

You've had some good pointers and suggestions:T
and I'm glad to see some of them working the way into your planning, it does take time to work out a propper budget:o, but with the info on this site you can make bigger savings than you thought:eek::D:D
Use the info on here for anyting to do with insurance and utilities and cashback sites are something to look into:j
The groceries can be cut th "money Saving Old Style board are great at that

As Gearge said it is a lifestyle change and the good peeps will help you through it:A

GeorgeUK

It might be a good idea to keep a spending diary for a month so that you can see where all the money is going and tie up any loose ends.

Just wondering - where did that decrease in the mortgage for the second SOA come from?

For the SBT, yes there is a charge (4%) but as this is then 0% for 16 months is often less than 2/3 months interest. If you get rid of the overdrafts by selling the car, you may be able to get rid of most of the HP debt or the larger loan and get this onto 0%. Your wife may also be able to get a 0% card - just make sure you don't use it for purchases as the interest start quicker and is paid off last.