My Friend's SOA - Help me get through to him...

MurrayMint

Hi All,

I need your help. My friend is not yet in serious trouble, but he's struggling month to month. I don't think he understands how to budget and has been down the consolidation route more than once. He separated last year and is now living in a 2 bed flat, having his children stay every other weekend. The other children related expenses is maintenance and then the entertainment is for when they stay. His requirement for the car is almost entirely so he can go and pick them up, as he now lives walking distance from work. Please do you have any advise?

Thanks,

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 4 (only every other w/end)
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 2211
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2211

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 495
Management charge (leasehold property).. 0
Council tax............................. 87
Electricity............................. 25
Gas..................................... 0
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 0
Mobile phone............................ 29
TV Licence.............................. 24
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 120
Clothing................................ 0
Petrol/diesel........................... 120
Road tax................................ 0
Car Insurance........................... 45
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 233
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 80
Holiday................................. 0
Emergency fund.......................... 0
LLoyds Bank Acc Fee..................... 17
Total monthly expenses.................. 1300


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 500
Other assets............................ 0
Total Assets............................ 500

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Sofa HP........................0.........15........10
LLoyds Overdraft...............0.........4.........10
Halifax CC.....................0.........60........10
Barclaycard CC.................0.........108.......10
LLoyds Loan....................0.........584.......10
Total unsecured debts..........0.........771.......-


Monthly Budget Summary
Total monthly income.................... 2,211
Expenses (including HP & secured debts). 1,300
Available for debt repayments........... 911
Monthly UNsecured debt repayments....... 771
Amount left after debt repayments....... 140

Personal Balance Sheet Summary
Total assets (things you own)........... 500
Total HP & Secured debt................. -0
Total Unsecured debt.................... -0
Net Assets.............................. 500

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

DarkConvict

MurrayMint wrote: »

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 4 (only every other w/end)
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 2211
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2211

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 495 Dunno about this, rent price depends where you live
Management charge (leasehold property).. 0
Council tax............................. 87
Electricity............................. 25 Seems a very low, especially so been no gas bill
Gas..................................... 0
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 0 Can he switch to a land line to save money?
Mobile phone............................ 29
TV Licence.............................. 0 Has a Cable service, but no TV?
Satellite/Cable TV...................... 24 Can he switch to freeview?
Internet Services....................... 0
Groceries etc. ......................... 120 Seems a very low, should be more towards 300
Clothing................................ 0
Petrol/diesel........................... 120
Road tax................................ 0 Is it a low emission car
Car Insurance........................... 45
Car maintenance (including MOT)......... 0 You should budget for this
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 233
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0 No Insurance?
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0 Use his own trimmer?
Entertainment........................... 80 Seems alot for 1 month
Holiday................................. 0
Emergency fund.......................... 0
LLoyds Bank Acc Fee..................... 17 Can he change to a free bank account
Total monthly expenses.................. 1300


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 500
Other assets............................ 0
Total Assets............................ 500

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Sofa HP........................0.........15........10
LLoyds Overdraft...............0.........4.........10
Halifax CC.....................0.........60........10
Barclaycard CC.................0.........108.......10
LLoyds Loan....................0.........584.......10
Total unsecured debts..........0.........771.......-


Monthly Budget Summary
Total monthly income.................... 2,211
Expenses (including HP & secured debts). 1,300
Available for debt repayments........... 911
Monthly UNsecured debt repayments....... 771
Amount left after debt repayments....... 140

Personal Balance Sheet Summary
Total assets (things you own)........... 500
Total HP & Secured debt................. -0
Total Unsecured debt.................... -0
Net Assets.............................. 500

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

Its good you are looking out for him.

I know you are having to take a guess on his expenses but i can see that he is nearing the edge. I'm sure his expenditure for some basic needs should be higher.

With regards to the car, he does not need it for work it maybe taken by a DCA if he cannot pay his debts. However, as he needs it for domestic use im not sure. There was a post on here before detailing the exact reasons when it cannot be taken.

It maybe an idea if you can get your friend to come along to these forums and post some information and see what offer this forum can give.

If he does not feel comfortable with that, as it is hard to discuss. Then perhaps a debt charity like CCCS or National debt line can help further.
There is also PayPlan, but from personal experience CCCS was more helpful.

MrsTinks

really you need him to fill in the SOA accurately as there are things missing like gas/heating, tv licence, road tax etc... aprs would also be very helpful

Tixy

Hi Murray

Glad you are trying to help your friend - I assume he has given you the info you have included?

From a quick scan nothing seems way over the top but I suspect part of his problems are coming from not budgeting for every expenses, so when they occur he reaches for a credit card.

He should include in his budget 1/12 of the annual cost of anything he doesn't pay every month - so this would include road tax, car servicing & tyres, tv licence (if not paid monthly), presents etc. Ideally he should also be physically saving these amounts in a separate savings accounts.

Its difficult about the car - his monthly cost will be higher than you have included due to servicing, MOT, road tax etc. He could consider if their is a car pool scheme near him where he could use a car (although I've no idea how these work out cost wise). £120 a month for fuel - is that 4round trips (does he pick them up and take them home?) is there any possibly that their mother could do one journey or meet at a midway point on the route.

Is his heating all elec? (no gas or oil)

Does cable include broadband. If he doesn't have broadband/a computer then he could consider getting rid of the satellite and using freeview.

Maybe he could look for cheaper things to do with the kids - I know it only breaks down to £10 every other weekend per child, but perhaps on some visits they could try to limit it by looking for free activities (check out the library for ideas). Or something like a movie night with a dvd & popcorn would work out cheap.

Is the £17 for a premium account - the benefits of these are usually not worth the cost - what is he actually getting (that he is using) for the £204?

His debts are not huge and if he is using the surplus shown of £140 to make additional payments then that is good. If he doesnt know where the surplus is going then suggest to him that he keeps a spending diary where he writes down everything he spends (newspapers, lottery tickets, pint down the pub, chocolate bar or bottle of pop, takeaway) all these type of thing add up and are often forgotten about in a budget.

If he can get a bit more organised with a budget and a savings account he should be ok. If however his debts are increasing month on month then he must be spending more than he realises.

Just my thoughts -Hope this helps.

gfplux

hello muraymint,

Well done for trying to help your friend. You are the only one who can decide if he is really serious about this.
Helping friends normally ends in failure as they may not have had the light bulb moment despite it being obvious to everyone else that they are in trouble.

The Car! - if you add another £50 to the petrol and insurance figures for road tax and maintenance. It is costing £215 per month (£2580 per year) for 2 round trips to pick up the children!!!.
How far do they live away from your friend. There must be a better solution. Also a car worth £500 may die on him at any time.

Good Luck

MurrayMint

Thanks everyone!. As you've pretty much guessed, his budget is pants :rolleyes:

This is the exact budget he gave me and he thought it was a proper budget, yet he's fretting how to pay for the MOT that's imminent (and yes, it will probably need work doing) and Christmas up and coming...

He's going to see his bank soon and has downgraded his account so he's no longer paying the fees. I think he's also ditched the PP on his loan, which will give him extra each month.

But I really wanted him to see your responses and see that there's a whole world of people out that that will chorus the same tune - realistic budget! You have to include annual costs, or you will rely on the CC (which are all maxed now)

I'll poke him till he comes to read this

euronorris

If he had PPI on the loan, get him to check if it was mis-sold (there is a whole section about it on this site).

If it was mis-sold then he can put a claim in. Well worth doing. I did it recently myself. It took 8 weeks for them to respond, but I got 354 GBP back! And with an unexpected dentist bill, that really helped!

Definitely worth getting him to check!