Wanting to be debt free BEFORE retirement!

planning_ahead_2

Hi all

I've been lurking and reading this forum for a number of weeks and been inspired by the fantastic progress made by others and have finally taken the plunge and looked at our debts. The biggest step was talking to OH about them - he's not daft and knew we had several credit cards (most maxed out:o) but it has always been me who has to juggle the money and pay the bills. We spend together so we are jointly responsible for where we are today - up the creek but one paddle just about in tact!

Ok - so I have just completed the SOA form and the outcome is shown below (with a couple of comments in anticipation of questions from others.

I aim to make this my diary - because I think (from following others on this forum) that those with the most success tend to keep a diary on here. I also have started a spending diary because although the SOA shows we have spare money each month - we don't currently ever have any money available and neither of us knows why.

I am looking at the other boards, eg moneysaving old style etc. We are both going to go through the house over the next few weeks and ebay anything no longer needed/used to hopefully generate income and space!

Now the biggest admission of all.......the mortgage on the house was originally £60k when we bought it in 2000 - however we have consolidated a few times - had holidays all over the world:o and have nothing to show for the extra £73k (no extensions, double glazing etc. etc). We have had a new kitchen a number of years ago and the house is well maintained, has fitted bedrooms etc but £73k:eek: Nobody is more appalled at this than us....we didn't realise until we looked at all the figures that we really have been living on borrowed money for years and getting worse and worse.

We are both 49 now and our children have flown the nest, so we both want to work together to plan ahead for our debt free retirement.

Sorry for the long winded introduction - deep breath:o here goes.....

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household.........
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 1934
Partners monthly income after tax....... 2001
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 3935

Monthly Expense Details
Mortgage................................ 701
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 132
Electricity............................. 100
Gas..................................... 50
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 22 work related & reimbursed in salary income
Mobile phone............................ 34 2 mobiles
TV Licence.............................. 12
Satellite/Cable TV...................... 30 incl. tv/phone/broadband - new agreement negotiated Dec 09
Internet Services....................... 0
Groceries etc. ......................... 400 realise this is high and aim to cut down to approx £200pm
Clothing................................ 25
Petrol/diesel........................... 150 car costs general - £186pm reimbursed by employer
Road tax................................ 25
Car Insurance........................... 70 already had £145 cashback from Quidco
Car maintenance (including MOT)......... 30
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 20 both wear glasses
Pet insurance/vet bills................. 0
Buildings insurance..................... 20
Contents insurance...................... 0
Life assurance ......................... 41
Other insurance......................... 0
Presents (birthday, christmas etc)...... 25
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Bank Charges............................ 50
Lunches at work......................... 60 for 2 people
National Lottery........................ 28
Weightwatchers Membership............... 18 cannot give this up - need the motivation of the group:o
British Gas Homecare.................... 24
Total monthly expenses.................. 2129


Assets
Cash.................................... 0
House value (Gross)..................... 210000
Shares and bonds........................ 0
Car(s).................................. 7000
Other assets............................ 0
Total Assets............................ 217000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 133000...(701)......1.5
Total secured & HP debts...... 133000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Northern Rock Loan.............5983......390.......8.8
Barclaycard 1..................7987......180.......23.04
Barclaycard 2..................3000......60........23.04
Overdraft......................3500......0.........0
Very catalogue.................310.......105.......0
Choice catalogue...............393.......76........0
Ulster.........................3400......98........24.5
Lloyds TSB.....................4851......97........18.8
MBNA...........................7700......194.......23.9
Nat West.......................950.......19........24.9
Halifax Gold...................10097.....101.......20.65
Total unsecured debts..........48171.....1320......-


Monthly Budget Summary
Total monthly income.................... 3,935
Expenses (including HP & secured debts). 2,129
Available for debt repayments........... 1,806
Monthly UNsecured debt repayments....... 1,320
Amount left after debt repayments....... 486

Personal Balance Sheet Summary
Total assets (things you own)........... 217,000
Total HP & Secured debt................. -133,000
Total Unsecured debt.................... -48,171
Net Assets.............................. 35,829

Created using the SOA calculator at https://www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using other browser.

planning_ahead_2

meant to note that buildings/contents insurance is a joint policy

planning_ahead_2

I've just found the snowball thingymajig and input all our debts (excluding mortgage at the moment). Debt free date based on paying £400 pm over and above basic repayments is November 2012. However, I think from the inspiration given on this site that we can manage far more than that and I have played around with 'what would happen if'

If we can manage £600 pm then debt free date comes forward to July 2012

If we can manage £800 pm :eek: the debt free date comes forward all the way to March 2012:T

I am going to start by aiming for the lower amount - so debt free by Nov 2012. I don't want to fall at the first hurdle by setting an unrealistic target. Hopefully as we get into the swing of this I will be able to bring forward the debt free date.

Now off to work out how to put figures (for inspiration) into my signature line.

PS. Also spent a couple of hours in the loft sorting out the junk for ebay....unfortunately so far all I have found is stuff to fill two sacks for the waste centre/recycling...and a few bits and pieces for freecycle. Basically they are so low in value that I would end up paying more ebay in fees than it is worth. Still I am getting through the stuff and getting to the stuff I know is up there and will be suitable for ebay.

It is amazing how motivated I feel already - just from working out the figures and realising that we can be debt free in a realistic amount of time.

planning_ahead_2

:jsignature line now sorted as well - definitely moving forward and I can't wait to start using the strike through text to start reducing the figures:j

grandma247

Well done for making a start. You may be interested in this thread and the grocery challenge thread.

http://forums.moneysavingexpert.com/showthread.html?t=2175209

We are trying to pay off our mortgage early so we can save a bit for dh's retirement in just over 8 years.I joined the challenge above last year and the difference it has made is amazing. The links for last year and the year before are on the first post.

planning_ahead_2

grandma247 wrote: »

Well done for making a start. You may be interested in this thread and the grocery challenge thread.

http: //forums.moneysavingexpert.com/showthread.html?t=2175209

We are trying to pay off our mortgage early so we can save a bit for dh's retirement in just over 8 years.I joined the challenge above last year and the difference it has made is amazing. The links for last year and the year before are on the first post.

Hi and thanks for the fab link. I hadn't found that thread yet:beer:

I have now signed up for the spending diary and will spend tomorrow going through the rest of the suggestions/links.

planning_ahead_2

Morning all

Debt diary Day 2:j

Had a good day so far - a no spend day:j We're probably had those before but never actually PLANNED a NSD:D

We have also been through the freezer and cupboard and planned the meals - we would normally have gone shopping this morning and bought more food without even checking:o Good news is that we have the main items for 17 meals:eek:...yep 17. We have the basic meat and some frozen (steam bag) veg. We will just need to purchase milk, fruit juice, fruit and some veg this week:T So week one of my new grocery budget (£50pw) is going to be beaten.

DH went through jacket/trouser pockets, I went through handbags etc., and between us we came up with just over £12.

We will go shopping tomorrow and buy those few basic bits. I discovered at Christmas the lakeland veg saver bags (green plastic bags) and they keep the fresh fruit/veg very fresh for up to four weeks....so will be on the lookout for some reduced stuff to put in the bags and keep us going for a while.

So overall....no debt reduction just yet:rolleyes: but I feel so much more in control and hopefully this is just the beginning of a new way of life for us:beer::T

Cialilerin

Well done for starting. I, too, have started a debt diary (started on 4th Jan) and am doing a spending diary. My debt is a similar amount but we have different circumstances - I have 4 kids between 12 and 3! so it's going to take us longer to be debt-free. However, like you, I feel really motivated to make the changes and I'm sure that the other money-savers on this site will help us on our way!

Wishing you the very best of luck!

planning_ahead_2

Probably the most useless piece of information to anyone but me, but I have just calculated (using excel) that it will take 1051 days for us to be debt free - so I am going to gleefully cross the days off via my signature and will hopefully be able to reduce that by additional income from ebay sales and anything else I find via this amazing forum.

Cialilerin

We can support each other, I've also subscribed to your diary.

planning_ahead_2

Morning all

Debt diary Day 3:j

I had planned a NSD today and thought it would be easy..being Sunday I thought we could stay home, cook, housework, ironing, list items on ebay (free listings today I think), etc etc...no money involved there then

However, DH was up and out before I was even back in the land of living and has come back with a haircut (on a Sunday:eek:), a loaf of bread and a treacle tart:eek:.

Haircut cost £10.00 (and I had put £0 for haircuts on my SOA:o)
Bread cost £1.10
Treacle tart (yuk) cost £1.00

So that's where £12.10 of my money has disappeared to:rolleyes: Haircut cost can come from the saving on groceries this week.

Plans for the rest of today then are

1) list at least three items on ebay (possibly more if I can find things:rotfl:)
2) do some batch cooking
3) do the ironing I didn't do yesterday
4) try to spend a whole 24 hours without looking at my snowball - cos it won't change until at least tomorrow when some DDs come out of the bank.

Regarding no.4 above - I have found (only 3 days into the life of DFW) that it becomes a bit obsessive - is that just me or is that normal Before joining this forum I more or less hid (well ignored) the figures and just paid the bills as and when they came in...never counting the totals and admitting the horrendous debt we are in. Now I can't stop looking at it and wanting a day to arrive where a payment is made.

So questions for seasoned DFWers

1. Is this obsessive, compulsive behaviour regarding reviewing figures normal or am I just odd:rotfl:

2. If it is normal - does it continue until the debt free date is achieved

Have a good day everyone:T