Help please, lightbulb !

Transformationtime

As my username suggests, I have had my lightbulb moment, and its time to transform my money outlook.

First things first, I am in the fortunate position of having 'manageable' debts. However, we are expecting our first child and having looked at our finances, I really think we have been frivolous in the past and frittered money away. I would dearly love to be able to give up work, or at least reduce my hours, in order to raise my baby myself, but that would turn manageable debt into unmanageable, so the debts have to be sorted first.

So here goes, any suggestions on how we could reduce our outgoings would be greatly appreciated (but be kind please, I'm in a delicate state!!)

My net salary £1100
Husbands net salary £1200

Outgoings

Mortgage £360.94
House Ins £9.74
Contents Ins £9.31
Level term assurance and terminal illness £9.65
Electricity £40
BT £35
Broadband £15
Car Finance £199.94 (hideous APR, too ashamed to tell you)
Sky £36
Rates £76
Finance for furniture £50 (but this is interest free)

The rest of these are estimates, but should be in and around the right figures

Food/drink/pet food/household £150
Petrol £160
Parking £80

Car tax £120/year
Car insurance £360

I owe about £700 on credit card which I hope to clear in the next couple of months, my husband clears his credit card in full when he spends on it.
We have a joint account for bills etc which we both contribute an equal amount to. I have only about £200 in savings (which are to go towards the credit card asap) and he has less than £1000 savings. (we have only recently been in a position to save at all).

So thats it, although I'm sure I've left something out. If anyone has any suggestions for getting us on the road to debt-free-ness.....

thanks for your help

CLAPTON

congratulations on posting here

just a few suggests to make your soa easier to read and more comprehensive.

add a few totals and separate 'normal' spending from the debts
so edit your SoA above to do the following

a. add a line after your income saying 'total income is 2,300'

b. remove unsecured debt payment from the spending section but leave the mortgage payment in

include all yearly figures by dividing by 12 to give a monthly figure...much easier to see where you are that way.
so for car tax, car insurance, mot, servicing, RAC/AA, provision for repairs etc divide by 12
also estimate any other yearly figures and do the same e.g. any holidays, presents, xmas expense and divide by 12

also for monthly costs..
do you spend anything on contact/glasses/dental costs/going out/work lunches/coffees/haircuts ...well everything you spend money on

then add that all up and add a line saying 'total spend is= xxxxx'

c. then itemise the debts...sorry we need to know the APRs too
so for CC debts show debt amount, monthly repayment, APR
for fixed loans show settlement amount (if know), monthly repayment, number of monthly left to pay and APR

then show a line giving total debt and total monthly repayments

then show any savings


sorry its so long but it will be worth it

Transformationtime

OK, thanks for that! Here is the revised version

My net salary £1100
Husbands net salary £1200
Total income £2300

Outgoings

Mortgage £360.94
House Ins £9.74
Contents Ins £9.31
Level term assurance and terminal illness £9.65
Electricity £40
BT £35
Broadband £15
Sky £36
Rates £76
Mobiles £20

Borrowings
Car Finance £199.94 (13.1%, shocking) £4900 o/s 27 payments left
Finance for furniture £50 (but this is interest free) can't find paperwork, not sure how many payments left
Personal loan £92 6.9% approx £2800 o/s (amazingly I forgot to put this in my original post, I must be in denial) 29 payments left
Credit card balance o/s £701, rate 14.9%, will be cleared asap

estimated total debt around £8500 (as I can't get my hands on all the paperwork. it definitely isn't any more than this), monthly payments of £341.94 (excluding CC which is being cleared soon)

Total savs held would be around £900/£1000 between us

The rest of these are estimates, but should be in and around the right figures

Food/drink/pet food/household £150
Petrol £160
Parking £80

Other expenses if divided into a per month basis would be

Contact lenses/glasses/eye tests £30
Haircuts/beauty salon £15 (sorry if this is too much info, but I have to have my underarms waxed as shaving brings me out in a rash and I'm allergic to creams!)
Eating out/takeaways £60 (yikes, had never added that up before!)
Clothes £20 (he would have to be dragged to the shops kicking and screaming, so no worries here. I used to be stupid about this, but have more or less completely stopped this type of spending, have much more than I need. Although am forced to shell out at the moment, much to my annoyance, due to expanding belly and likelihood of arrest otherwise...)
Car tax/insurance/maintenance £65
Sunday papers £6
Home heating oil £50
Coal £10

I can't think of anything else at the moment, although I don't doubt there are plenty of things. Have been quite disciplined recently, have all but cut out things like buying magazines, we both take our lunches to work almost every day, we switch lights off when not in the room and don't leave appliances on standby and, due to scary price of home heating oil, have worn an extra layer of clothes all winter, before resorting to putting the heat on. And its now 4th May and every bit as freezing as it was in the middle of January, there is no respite!!

As I said in my original post, I realise that we are in the fortunate position of being comfortable enough with these debts at the moment, and I don't wish my post to be insulting to those who are struggling, but I have just decided that enough it enough.

thanks

lynzpower

First off, you could move your credit card to a 0% one, this will help that what payments you make will reduce what you owe.

**purpleprincess**

Could you try and cut down your food budget? Take a look at the old style board for ideas on grocery shopping.

What are the parking costs?

Could you go to the local college for your waxing? They are usually very good, supervised and cheaper!

Cut down on your eating out and takeaways, my boyf and I have started cooking our own takeouts, curries etc, very yummy and loads cheaper!!

Could you read the Sunday news online?

Ummmm, can't think of anything else at the mo!!

LookingAhead

Is there a mobile beautician who will do waxing cheaper in the comfort of your own home? Or sometimes they have their own businesses at their home and that's quite cheap too.

(By the way I tried freebie Veet wax strips today - really good actually, better than I expected and it didn't hurt. Check out the freebies board and look for Veet Waxing Strips).

As lynz said - look to move your credit card to a 0% one if you can.

Again, as has been mentioned, try and reduce your shopping bill. The £60 on eating out & take aways...well, your reaction when you added it up says it all really! That needs to stop or be cut back dramatically.

Do you really need Sky?

Good luck though, it doesn't sound like you have too much to do to cut back/claw in some savings.

CLAPTON

its really important that you add up the totals so you can see where you are:

i think the situation is this
income tot 2300
spending tot 1257

surplus 1043
debt payments 361

so you have a massive £ 682 per month to snowball your debts.

now you need to check the totals yourselve and to assess whether everything is included in your spending (do you really spend nothing on present/xmax /holidays? )
anyway you should
a. pay off the cc debt now with your monthly surplus and/or your saving.
b. depending upon the T&Cs of the loans (can you pay of early without penalty or not) you can either repay early or save the 682 in the best saving a/c you can find.

but i would come back to refining your spending budget...if you are into spreadsheets put it on one or else use the 'budget planner ' at the top of this page.

the budget should be a living thing updated each month and not just something done once and forgotten.; and remember to include everything you are going to spend in the next 12 months (...things for the baby perhaps..)

best of luck

Transformationtime

Thanks, I never thought of mobile beauticians or whatever, I will definitely check that out. Have tried waxing myself, but its kind of hard to reach the underarms, and not sure that even the strongest marriage could survive getting the other half to do it!!

Will check out the old style section for bringing down the food bills. Ironically, I would have thought that our bills shouldn't be as much as this, we do all our own cooking (pretty good at it too, even if I do say so myself!!) and don't buy ready meals or frozen stuff, and use up our leftovers, but looking at the supermarket receipts its all there in black and white, so there must be cutbacks to be made somewhere.

The parking is the cheapest car park we can find, its a 20 minute walk from work. We both travel together and share with one other person, and we get a good deal as the other person pays half and we pay half between us (i.e. we take our car one week, the other persons the next week, and whoever is driving that week pays for the carpark. we get the good end of this deal, as you can see, both in running costs and car parking).

Didn't include holidays because theres not likely to be one for a while, but you're right that I forgot to include Christmas. Have picked up a lot of freebies for the baby, all the major one offs such as cot etc, and pram is a gift from in-laws, but obviously there will be expenses in this area on an ongoing basis.

LookingAhead

Sounds like you're doing really well on the car parking and well done for doing all your own cooking. I guess just check out the OS board in case you can find some yummy but cheaper recipies. Also look to see if you can make savings with things like cleaning stuff (check out the Stadrops thread!!), washing powder etc etc. It's not just food I guess that bumps up the bill at Sainsburys (or wherever).

The Veet strips are made with sugared wax - really really not that painful & I did bikini line! :eek: :rotfl:

If you can get them free, I promise, if your OH does it, I don't think it will be that bad. But of course, up to you. (How about a best mate trying actually..?)

I gues the only other thing for you to consider is selling on EBAY, Amazon, car boot sales etc to get a little bit of extra cash in to help bring down a credit card bill or save or whatever.

Check out QuidCo (https://www.quidco.com) (there is a dedicated thread on the site somewhere as well) for essential pucrhases that you can do online - you can earn money back.

Keep coming back to DFW forum anyway and it's amazing how many little tips you'll pick up. Couple with the freebie board & OS board etc you'll be an addict in no time

Transformationtime

ha ha, I'm not so much worried about the pain but would he be able to stomach a close examination of my armpits?!! There are many indiginities in married life, I'm scared that would be one too far. I have a 16 year old niece who would probably be keen to play beautician, (and wouldn't be scared to inflict pain!), I'll maybe see if I can get her on the case instead !!

LookingAhead

Fair enough. Mind you, if your first child is on the way, he will have to get used to more than your under arms