Starting out

paprichaat

Hi,

After reading all the great support on this site I've decided to air my circumstances in the hope of your encouragement. I am in debt to the tune of £14,000. How did I get here? Well, I did have 2 crushing years with no income and a family to support, and then I moved house in Jan and this cost me a minor fortune in stamp duty and the like....I dont feel like I spend much , but I'm sure I've made a lot of unsound choices and been my own worst enemy when it comes to overspending on big ticket items (holidays, new kitchens etc.)

My debt breakdown:

£10k - egg loan at 6.9%
£2.7k - Zopa loan at 6.1%
£1k on egg card
£500 on o/draft (HSBC)

I am lucky enough to take home about £3.2k per month. But my mortgage alone is £1500 per month and I'm on a fixed 2 year rate which I cant move.
One thing I'm seriously considering is to sell my endowment policy (worth about £9.5k) which has been trashing it over the past 10 years and pay off my egg loan...what do you think?

onwards and upwards

lynzpower

Hi there :hello:

Well done for finding us

If you do a full SOA ( see southernscousers sticky) we will be able to see what you spend and where. there could be some cutbacks we can find for you, in order to get your debt free date quicker!
Lynz
x

paprichaat

Thanks Lynz,

Here's my first srfat SOA

Income: £3.2k per month (on average)

Outgoings per month:


Mortgage: £1500
Council tax £200
Life !!! (wife & I) £60
Food and consumables £600 (wife handles this bit) (family of 4 plus 1 hungry Lab)
water: £15
Elec £30
Oil £40
zopa loan £157
egg loan £200
Phone £20
endowment £37
TV lic £10
Car ins/tax £50
fuel for car £200

total outgoings: £3210

We are doing a strict analysis of our exact spend in May, so I should be able to provide a more detail on the £600 "food + consumables" by early next week.

mattp_3

Hi,

If you are earning £70-80,000 per annum, you should be able to service £14k debt with a few helpful money saving tips - post your SOA then we can make some suggestions?

regards
Matt

mattp_3

yeah - looks like the savings will have to come from that £600 housekeeping

CLAPTON

is the mortgage a repayment mortgage or is the endowment related to the mortgage?

in any event, i would use the endowment to pay off debt.
it rather depends upon the t&c s of the loans (are they fully flexible or are there penalties for early repayment?) but i would pay off the cc or loans with the highest APR first

cancelling the endowment will free up £37 per month and debt repayment should free up around £200, but even then you will need seriously to plan a proper budget...the current one doesn't seem to allow for clothes, kids / school expenses, holidays, presents etc.