Big Debts Help!

Prudent

The grocery bill is just massive. Its two and half times your wife's wage! I think it could easily be cut to £250 a month. What about doing the food shop on line? Your wife can do all the ordering and you can check it before the order goes in. Much easier with two young children anyway. I feed myself, my 17 year old daughter, two cats and often some visitors for £120 a month. We eat well.

Very young children quite easy at Christmas. Set yourself a budget and go to a car boot sale. Most toys for very young children are in excellent condition and often sell for 10 -20% of the shop price. You can still give them a bumper Christmas - also you don't have the work of disposing of all the packaging. If telling the visiting relatives is an issue, be creative about how you wrap the toys. Putting them in stockings or pillow cases - so that the children can have the fun of pulling the toys out and enjoy them right away can explain the lack of packaging.

When you have children it is common just to buy for the children in the family. Ask your relatives just to buy for them and not you. Then you can buy for their children and do the same as above.


Do check if you have a 'death in service' benefit at work. This may reduce the need for some of those insurance policies.

Mansun

Thanks again for all the advice although there seems to be some conflicting opinions. Some are saying that the problems are easily fixable by tightening the purse strings a little whilst others appear to be saying that I am very close to doom and gloom...!

I have started a daily spend diary last Friday (but have not yet had a NSD?!) and I think...think...that I have got the wife on board. We are going to do an internet shop together (there might be shouting :mad:) this week and see if we can save some money to plough into reducing our debts.

We also have about £400 in savings that we are going to use toward a credit card but don't know which one...probably the Tesco one...any thoughts.

Regarding the N Rock loan, it ends in May next year so will be paid off soon enough freeing up just over £250 a month to distribute elsewhere.

We will not be cancelling Christmas but making it 'smaller' than usual. We have however cancelled New Year which is a big sacrifice for us but will save a couple of hundred quid at least.

Oh yeah and we won £15 on the Euromillions last week. :T

All the advice and reassuring words are much appreciated. The guys on this forum are the best I've never met...:beer:

RAS

Hi

Definately not the tesco's one.

You did not put all the Aprs into the SOA, but either pay extra off Northern rock becuase the minimum payment is so high (or is this a loan?) or pay your savings towards the most expensive credit card (the one with the highest APR.

if you go back to sense of cards you can hit the snowball button and se what impact that would have. Otherwise feed them all into WWw,whatsthecost.com.

Mansun

Yeah, N Rock is a loan that ends in May next year. I don't think there is any penalty for paying off early though...?

Maybe it would be a good idea to pay savings money towards that to try and free up the £250+ a month for other debts earlier?

I really need to establish exactly what all the APRs are and then make the right decision with them...

RAS

OK

Even if there is no penalty for paying off the NR loan early, paying a higher rate CC is goign to be more effective (reduce your debt quicker), so you need to know the APrs on all the debts.

What this does mean is that if you can get throught he next 6 months, life could get a lot easier.

Things to think about: what can you sell? Can the missus get out there and get a Christmas job (Boots here are advsertising but only in the shop window).

milliemonster

It does look to me that you have had your LBM to a certain degree but your wife hasn't.

It's all very admirable wanting to provide for your family and not wanting to let them down, but please realise you ARE providing for your family, but you have to look at what you need, what are nice to haves and what are definite luxuries you can do without.

You need to sit down with you wife and go through your SOA together so her eyes are well and truly opened to your current financial situation, it may also be worthwhile just totting up where your debts will be in a years time if nothing changes? just to scare her into thinking something has to change NOW.

Your debts aren't actually that high at the moment, but they will be if you don't take action.

Tbh, I would forget the bank appt, they will either try to convince you to consolidate and take out a loan (not good advice imo) or tell you you need all these insurances, just remember, the bank is there to make money from you, not to be your best friend and help you out of debt, that's what we are here for.

We used to spend an extortionate amount each month on 'groceries', easily £6-700 for the four of us, and a lot of this was put on the credit cards, it does take time to adjust to a new budget and its hard when you know how much you earn and feel no benefit of that salary (I earn the same as you) each month as its all spent, but once you start being a bit more savvy and seeing the debts dropping, you will see there is llight at the end of the tunnel and you will soon be in a position where that money is yours again to spend as you want rather than credit

good luck xx

Mansun

Great advice guys thanks.

I'm still going to keep the bank appointment but I'm going to use it to find out exactly what my various insurance/assurances cover me against.

Then I can try and get them cheaper elsewhere if cancelling is not a good idea.

RAS

Good idea. Also check whether you get anything with your employment. No point having Critical Illness cover from 13 weeks if work covers you until 26 weeks etc.

Mansun

RAS wrote: »

Good idea. Also check whether you get anything with your employment. No point having Critical Illness cover from 13 weeks if work covers you until 26 weeks etc.

Good point...thanks!

ZarZar1990

Mansun wrote: »

Hi All,


Thanks in advance from a MSE newbie...

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.................... 1
Monthly Income Details
Monthly income after tax................ 2450
Partners monthly income after tax....... 200
Benefits................................ 173
Other income............................ 0
Total monthly income.................... 2823
Monthly Expense Details
Mortgage................................ 800
Secured/HP loan repayments.............. 140
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 90
Electricity............................. 70
Gas..................................... 50
Oil..................................... 0
Water rates............................. 47
Telephone (land line)................... 19
Mobile phone............................ 20
TV Licence.............................. 12
Satellite/Cable TV...................... 35 Can you cancel this and get freeview?
Internet Services....................... 5
Groceries etc. ......................... 500 This could definitely be lowered, if you shop at the right places, pre-plan meals, and buy cheaper branded products you could cut this down to about £300 for four of you, my friend has family of 6 and only spends £400 per month, so for a family of 4 I think £300 is realistic, look into this
Clothing................................ 50Can you put off any new clothes until absolutely necessary? Maybe until January, I understand with kiddies that are rapidly growing this is hard though.
Petrol/diesel........................... 200Get a club card from tesco, build up points, you can spend those points on fuel, also look at Martin's article on fuel saving
Road tax................................ 18
Car Insurance........................... 31
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 10
Buildings insurance..................... 9
Contents insurance...................... 4
Life assurance ......................... 50
Other insurance......................... 100
Presents (birthday, christmas etc)...... 20
Haircuts................................ 0
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0
Child Trust Fund........................ 50
Total monthly expenses.................. 2400

Assets
Cash.................................... 700
House value (Gross)..................... 160000
Shares and bonds........................ 0
Car(s).................................. 5000
Other assets............................ 0
Total Assets............................ 165700

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 124000...(800)......5.5
Secured Debt.................. 21500....(140)......5.5
Total secured & HP debts...... 145500....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
N Rock.........................1400......256.......11.9
Tesco CC.......................470.......11........NaN
Next...........................520.......30........NaN
Black Horse....................2000......75........NaN
Barclaycard 2..................3465......80........18.9
Santander CC...................5840......135.......0
Virgin CC......................1340......30........NaN
M&S CC.........................1380......35........3.9
Barclaycard 1..................390.......10........0
Total unsecured debts..........16805.....662.......-

Monthly Budget Summary
Total monthly income.................... 2,823
Expenses (including HP & secured debts). 2,400
Available for debt repayments........... 423
Monthly UNsecured debt repayments....... 662
Amount short for making debt repayments. -239
Personal Balance Sheet Summary
Total assets (things you own)........... 165,700
Total HP & Secured debt................. -145,500
Total Unsecured debt.................... -16,805
Net Assets.............................. 3,395
Created using the SOA calculator.
Reproduced on Moneysavingexpert with permission, using IE browser.

Welcome welcome welcome to MSE, I've just put in all the points I could think of, all the 'easy' places to trim the fat, I really hope you're okay, and you'll do fine, soon more people a lot better at this than me will be along with tips, all of my tips are in red
xxx