First time post/long time lurker

rogerwilko

Hello everyone
I’ve been reading snippets of this site and forum for a while now, but I’ve finally taken the plunge and decided it was about time my wife and I got our finances in order. This has come about from an embarrassing event in my local bike shop. I’d dropped my mountain bike in for some much needed repairs, and went I went to collect it a few days later, my credit card was refused at the till. When I called the card company later that day, it turns out, because my bank had not sent off payment, my credit limit had been severely cut, all without informing us.
For at least the past year, we’ve been lurching from one loan to another, relying on credit cards and re-loans when things were close. But no more, we can no longer live like that. The most frightening part of this trip to a debt free life has been to face our debt, I’d ask the wife to sort out the finances, she’d tell me to do it, and between us, nothing would get done. I’ve just spent the whole of today going through our drawers and digging out all the bank statements and credit/loan/utilities bills, and most importantly, adding it all up. I’ve taken the advice of previous posters on this forum, and it’s in all its glory below.
As you can see, we earn quite a wedge between us, but, and I’m the first to admit this, we don’t budget for anything. If we want something, we pretty much just go and get it. Also, my passion is for cars and driving, and petrol and bits for my car are not cheap. The bulk of the petrol costs are for my car, which can sometimes be over £200 on its own a month. Not good.
So, time to cut back, and take a step back to assess where we can start to make savings.
1/ we’ve already been online and cut our sky bill down from £21 to £15 (the extra £10 is for the TIVO service)
2/ I used Martins energy comparison site, and saved over £360 a year by switching suppliers online (+ we get the £12.50 when we switch)
3/ STOP USING MY CAR FOR SMALL TRIPS. It’s a big 2.0 turbo engine, and drinks optimax, whereas the wife’s small 1600 fiesta is a lot more frugal. I work nights some weeks, no need to have 2 cars on the go when I’m on nights.
4/ cut down our grocery shopping and work food bill.
5/ loans and cards: the biggest problem we’ve got. All of the cards and loans we’ve got are at very good rates, so I’m not sure we can save any money there. I don’t think we can apply for any more cards or loans for a while anyway. I’ve just sent off for our credit rating on Saturday, so I’ll see what comes back.

After getting it all down on paper like this, and using the excel spreadsheet from the site to set out our position, it’s become a lot clearer what we have to do to beat this debt. This is going to be hard for me, probably harder than giving up smoking last year to get my dream car, but it’ll be worth it in the end.
Any help or advice would be greatly appreciated; I’m counting on you all to get us through this.
Chris.

Monthly Incomings:

Our salary - £3200.00
Benefits - £145.00

Total - £3645.00

Monthly Outgoings:

Mortgage/Rent - £729.28
Council Tax - £103.87
Gas - £40.50 (switched to cheaper using this site)
Electric - £44.50 (switched to cheaper using this site)
Water - £35.11
TV License - £32.87 (quarter)
Sky/Tivo - £31 (reduced to £25)
Phone - £20.00
Mobile Phones - £70.00
Internet - £17.00
Food - £433.00
Eating out - £80.00
Car Insurance - £108.84 (2 cars)
Petrol - £216 (2 cars)
Tracker - £120 (annual)
CSMA Breakdown - £49.50 (annual)
Household Maintenance - £17.50
Buildings/Contents Insurance - £38.00
Window Cleaner - £3.50
Mortgage Insurance - £15.17
Plumbing/Gas Cover - £20.41
Work meals/coffee - £43.12

Total - £2269.17

Total Debts

RBS Credit Card - £102 owe £4542.56
CAPITOL ONE Credit Card - £15 owe £809.43
CAHOOT Credit Card - £99.67 owe £4956.94
Wife’s RBS Credit Card - £79.00 owe £4204.15
RBS Loan - £389.28 APR 8.3% 5 years left
ALPF Loan - £288.49 APR 5.9% 4 years left
EGG Loan - £385.49 APR 7.9% 72 MONTHS LEFT
Liverpool & Victoria Loan - £293.51 APR ?% 7 years left
Simply Be Store card - £16.00 APR 20%? £56 left to pay
Car Loan - £247.64 5 years left


Total: £1916.08

Total income: £3645
Total spending: £4185.25

Shortfall: £540.00

Molanole

Hi there Roger,

I'm a newbie myself so not great on the advice side as I'm just getting started but wanted to say hello, welcome and well done for taking the first step and posting. Having been lurking for a while (as I did!) you'll already know how helpful everyone is on here so I shall shut up and let someone more useful than me take over!

Anyway :hello: and good luck in your efforts.

Ali-OK

Hi and welcome to the boards :wave:

Well done on posting and getting all your paperwork together, plus with both you and your wife onboard and the changes you've already made, it's a good start. And another car nut too!! (me also). Fan of pistonheads per chance?!

Sure they'll be some more experienced people along than I to give advice, but I'd say your food bill is high. How many in the family? Have a look at the Moneysaving OS boards - lots of tips on buying own or value brand goods, meal planning so you only buy what you need, etc. If its just the 2 of you, you could easily cut that bill by two-thirds.

Can you get better deals or move to PAYG on your mobiles? That would give you a saving.

Can you get a package for internet/phone - like Talk Talk at £21 per month - you could save against your current costs. (Have a nose at the phones forum).

Have to say, cut the window cleaner! Even at £3.50 a month - it's still £42 that you need elsewhere!

Can you give you work meals and take home made instead? Big savings to be made!

Hope some of that helps!

JAMIEDODGER

firstly i would say welcome and well done for posting!

secondly.....

ditch the meals and all at work, take pack ups and flask from home.
ditch window cleaner
reduce food bill. is this for 2/3? i feed me and 4 kids for £35 per week get yourself over to the os board for advice
stop eating out, you plainly cant afford it
ditch plumbing/gas cover....put amount in a savings account instead and if nothing breaks the money is yours.
petrol...good idea, use the wifes more economical car when she isnt using it.

pay that £56 off the store card, cut up and cancel it...thats one debt gone!!!

JD x

tesuhoha

Yes I would add to that you seem to be owing lots of small fiddly amounts, I would pay all of them off asap then it will all seem more straightforward.

rogerwilko

Thank you all for replying so quickly, I knew I could rely on you lot to perk me up. It's been a depressing day in some ways, as I now know that our old life of "buy now, pay later" is behind us, but ahead is only good news. I'm listening to Johny Cash as well, so that could be why I'm depressed too
Molanole, thanks for the kind comments, but my names Chris, rogerwilko is my username
Ali-OK, yep, fellow pistonheads devotee, but mainly scoobynet. I'm not using the same username on here though, for obvious reasons.
I know what your saying about our food bill, but that includes our drinks for the week as well, as we don't go to the pub much, if at all.
I've just started shopping at Tesco, so I'll see how that goes, as my shop this week was cheaper than the last time at Morrisons. Time to go hunting on the boards for some bargains I think.
BTW, there are 4 in our house, 2 kids of 9 and 11 y/o which is part of the reason why the food is soo much
Both our mobiles are on contract, mine until June, wife until August, so nothing we can do until then. I'll make a note to change when we can, and go payg. Internet is the cheapest we can find, payg broadband from force9, phone is with post office home phone, + discount from work.
We all eat full meals at home, and take sandwhiches everywhere. Even been making our own bread since xmas, which is nice. Just spending on rubbish at work, odd bag of crisps, coffee from machine, cakes! No need! Time to stop I think.
JAMIEDODGER, consider the store card gone. Although we're short this month, we'll make sure that is paid off first
Never thought to ditch plumbing gas cover. Probably good idea especially during summer when central heating isn't even on. Will look into that, thanks.

Thanks to you all for posting back so soon, I'm a little cheerier now.
On the plus side, I've got a big bonus due from work, 2 in fact. 1 of £400 and 1 of £1500 (hopefully) which will go some way to alliviating our current situation. How to spend that the best way though?
Also, both my wife and myself have some scope for overtime, upto around an extra £500 a month. I must say, this situation with our finances has come about mainly because I've been living as if I've been working nights, and only getting an early shift wage, a difference of £130 per week. It soon adds up!

Thanks again everyone.

chris.

Molanole

Oops, sorry for getting your name wrong Chris!

As far as the bonus goes, and someone will correct me if I'm wrong, if you want to put it towards paying off some debt the advice would be to pay the highest APR first - hence all of the advice to get rid of the store card as they tend to have scandalous APRs!

Good luck and keep us posted. I'm off to make my packed lunch for work tomorrow!

Ali-OK

Hi Chris

I'm more a lurker on PH these days - spend too much time on here picking up new MSE ways!! Re: username, of course, same here!

Ahh..with 2 kids we can see where some of the money goes! Checkout OS again for the Monthly Grocery Challenge, Storecupboard challenge, etc. It does take time to get your food bill right down, small steps lead to big strides, etc.

OK, energy savings then. Now you've swapped suppliers, you could move onto stuff like energy saving lightbulbs (2 for £1 in Wilkos or Morrisons recently had them at 50p each). I know with my DS, he leaves lights on all over the house!

Batch cooking - is that something you're doing? Saves on cooking cost, time and then you've got stuff in the freezer already for a night you don't want to cook.

Someone is bound to come and tell you that Tesco's should be changed for Aldi/Lidl/Netto! BlackSaturn sees Tescos/Sainsburys like we see M&S !!

Do you get your fruit and veg at the market? (Much cheaper IMO). Meat at butchers, farm shop, etc?

Get into good habits of using the net for price comparison (https://www.fixtureferrets.co.uk) I think(!) is the one for supermarket prices and finding the BOGOFs, etc. Toiletries are generally much cheaper at places like Wilkos, Savers, Bodycare.

Your bonus! If you can use all that to throw at cc's, then great! Use https://www.whatsthecost.com - there's a snowball calculator, input all your cc's/loans, APR, amount you can pay each month and it'll tell you the order to pay them (largest APR first) and how long to get to your DFD (debt free date). Don't be disheartened if its a way off - stick with MSE and us lot and you'll be bringing that forward in no time!

CLAPTON

as you have two children and otherwise, there are clearly items missing from your spending list

i would very much suggest you both start a spending diary so you see where all your money is actually going
i would suggest that the following, at a minimum is missing, car tax, MOT, servicing, children must produce some school related costs, kids clubs/activities, must be clothes, presents and xmas costs, holidays?

unless your bonuses etc are fairly regular and significant and bearing in mind the possible missing items, i would think you would need to take some fairly drastic reductions

firstly can you get rid of a car?
otherwise
replace mobiles with PAYG and dont use them unless emergency
eating out to go
tracker to go
gas insurance to go
lunches /coffess at work to go
petrol ...major reduction

even then this doesnot make you break even unless you can get rid of a car

is there scope to increase income?
sorry if this is a bit depressing but its how i see it.

kar

Here's my thoughts on how to spend your £1900 bonus best:

RBS Credit Card - £102 owe £4542.56 PAY £1034.57 OFF THIS ONE - LEAVING A BALANCE OF £3507.99
CAPITOL ONE Credit Card - £15 owe £809.43 PAY THIS OFF IN FULL
CAHOOT Credit Card - £99.67 owe £4956.94
Wife’s RBS Credit Card - £79.00 owe £4204.15
RBS Loan - £389.28 APR 8.3% 5 years left
ALPF Loan - £288.49 APR 5.9% 4 years left
EGG Loan - £385.49 APR 7.9% 72 MONTHS LEFT
Liverpool & Victoria Loan - £293.51 APR ?% 7 years left
Simply Be Store card - £16.00 APR 20%? £56 left to pay - PAY THIS OFF IN FULL
Car Loan - £247.64 5 years left

Here i'm guessing that the RBS has the highest APR of your reasonably large CC's as the min payment is the most. Check out your APR's and pay the £1034.57 off whichever is the biggest

MrsTinks

for now take the extra shifts and get the extra money in! Also (if you feel brave enough) add to each debt the total (I noticed some of the loans didn't include the grand total) and the APR % that will help us see the exact amounts we've got to deal with here
Your loans... do they per chance have loan protection on them? If they do find out how much you will get back if you cancel this and take up an independant policy to cover all your debt payments... I shaved over £2000 off my debt by doing this! And my loans are no-where near the size of yours so imagine what you might save? (you can usually either reduce your monthly payment OR shorten the term of your loan, I opted for lowering my debt repayment because I can overpay each month with no penalty so can overpay when I have spare money).

Mobile phones should still be able to be reduced onto a lower tarif, so check with your provider that you're on the best tarif for you.

Food... OS is the way to go I know there is 4 of you but you should still be able to cut that down. The kids are old enough to join in with helping out and instead of 35p for a greasy pack of crisps how about letting them help with making their own? Costs a spud and some time and salt and thats about it OH used to eat loads of crisps (still eats them) but now he eats healthy home made ones Also a LOT cheaper And dead trendy in lunch boxes I'll bet

GET A SLOWCOOKER easy to use and great for making twice as much as you need and freezing for those instant meals you can throw in a microwave if you're rushed or even to take to work

I know you obviously love your dream car... but is this a dream you can afford right now? I can't talk as on my drive sits my beloved mx5 which I will only part with if it was a matter of saving someones life! But you have kids and surely a roof over their head is more important than the dream? Get a second run around... My neighbour got one for his son today and paid the princely sum of £400 for 12 months MOT and 6 months tax... Also cheaper insurance I am sure and that anual £120 for the tracker would help elsewhere too....

Oh and making your own bread is only cheaper if you don't use the pre-mixed packs But I WILL concede that it tastes fantastic

Dinners out have to go for now... It's summer - Do a picnic instead!

Oh yeah... Welcome to DFW