Help / Advice needed to cut outgoings & debt

andys15

also you say youre car is worth 18000, with 1500 other assets. They have got to go mate. You have over 19k of debt, and 13k of that is not being touched as you appear to only make the minimum payment. Youre over 200 quid loss every month, and there not much space in youre SOA to claw that back.
You must get over the fact you are a high tax earner, because with the big house, 18k car you are infact on a low income to maintain youre lifestyle.

Verbatim

Or take a lodger/foreign student?

GeorgeUK

Mortgage................................ 1720
Ouch!! I have noticed when people post their SOA's that once the rent/mortgage goes over about 40% of income, people start to struggle. Is it possible to switch to interest only for a while?

Council tax............................. 175
If paying over 10 months, can you ask to pay it over 12?

Electricity............................. 48
Gas..................................... 79
These are a little high. Check the comparison sites for a better deal (uswitch, moneysupermarket). Check your meter readings and see if you are in credit with the comapnies. Make sure you switch anything your are not using off rather than leaving on standby.

Mobile phone............................ 26
PAYG?

Telephone (land line)................... 30
Satellite/Cable TV...................... 0
Internet Services....................... 0
Are these a package deal?

Groceries etc. ......................... 360
This could be cut a bit. Take a look at the oldstyle board for mealplan ideas and buying/cooking in bulk. Can you take your lunch/coffee in to work instead of paying for it?

Car Insurance........................... 35
Buildings insurance..................... 25
Contents insurance...................... 25
Life assurance ......................... 0
Other insurance......................... 50
Again, check the comparison sites to make sure you are getting the best deal. Also use a cashback site when changing (also utilities) as you may get some extra money back.

Emergency fund.......................... 0
Need something in here.

I would also advise keeping a spending diary so that you can see exactly where all your money is going. This should help you to make sure your budget is correct.

There are a few areas where you could cut back a little and you might just be able to cover the shortfall. If it's an option i would try to go for interest only payments for a while to try to remove at least the hight interest debts and hopefully some of the others. Your expenditure is just short of your income right now before making payments to the cards and loans. If you can reduce both the debt on cards and your expenditure, this should be quite managable.

R_H_T

Thanks, folks.

I'll apply to the C&G for an interest only plan for a little bit. That will free up approx £250-£300 which is what I need. Repayment is £1720 and interest will be around £1420 / 6.39% is my rate.

Quick question: I could also ask for a payment holiday and use this money towards paying off some of the debt and then go back to my current repayment plan.

Whats better? Switching to interest only for a bit or payment holiday?

Either way, if I do this I could generate the money I need. While it wont solve the problems completely I should be ok and avoid any dangerous territory for now...! I hope in October to get a small payrise which might help bridge the gap.

Is my thinking right?

Ames

What's the other insurance?

Is your wife aware of the situation? The whole family need to be on board for anything to change.

I can't really add anything else to what the others have said, you need to up your combined income, or move house really I think.

GeorgeUK

I don't have a mortgage so can't really comment with any conviction here. If it were me i would ask for a payment holiday (any idea of how long they would allow?) and if they refused, you could request to go to interest only for a few months (again no idea of how long is allowed - will try to look at some other posts).

It might be worth looking at how much the missed payments would go up by over the remaining period of your mortgage and compare this to how much you will be able to put towards the debts if you go interest only. Hmmm, how much extra would you be paying if you added an extra year to the mortgage -v- how much extra would you be paying over the life of the mortgage on the amount not paid over the holiday. It might actually be more economical to go interest only in that case.

While it may free up the £250 you need, this will only be for a short time and it looks like (if you can get this over a year) a reduction of about 3k in that period will still leave you with needing to save about £180 from your expenditure to maintain the minimum payments once the interest only period ends.

Not really giving a clear answer am i?
Sorry - looks like you will need to do a bit of number crunching, but my gut says go interest only and tighten the belt with the advice above. Hopefully by the end of the year you will have 16k or less to tackle and will have more funds to throw at it (£180-ish?). Right now you are getting the 0% deals you need, but if those start becoming scarce again it could be a struggle.

Don't forget that alot of the cards allow you to do a 6 month 0% transfer as an existing customer which won't require a credit check or they may give you a 7% or so life of balance transfer offer. It's alot better than paying the full interest rate but i always wait until i have received a nil balance statement.