Can anyone help with some advice or support?

grizzled1

Hello

Sorry to trouble you, but I wonder whether someone would be able to have a look at my SOA below and let me know what they think? I can see there are savings to be made but they seem so woefully small in relation to the amount of debt. We've slipped little by little over the last 16 years and we've finally bumped against the buffers. At the moment, I can't see a way out.

I'm going to contact National Debtline today, but I'm worried we may have even gone beyond a DMP. If we can get one, I'd be glad to get any comments on how people coped with cutting back on children's opportunties, and also dealing with the shame of telling family and friends.

Kind regards and thanks in advance for any advice you can offer.

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................ 2173
Partners monthly income after tax....... 450
Benefits................................ 132
Other income............................ 0
Total monthly income.................... 2755
Monthly Expense Details
Mortgage................................ 590
Secured/HP loan repayments.............. 601
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 133
Electricity............................. 91
Gas..................................... 46
Oil..................................... 0
Water rates............................. 50.47
Telephone (land line)................... 40
Mobile phone............................ 25
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 700
Clothing................................ 50
Petrol/diesel........................... 180
Road tax................................ 12
Car Insurance........................... 28
Car maintenance (including MOT)......... 25
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 33
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 17
Contents insurance...................... 0
Life assurance ......................... 27
Other insurance......................... 0
Presents (birthday, christmas etc)...... 110
Haircuts................................ 40
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 2820.47

Assets
Cash.................................... 0
House value (Gross)..................... 160000
Shares and bonds........................ 0
Car(s).................................. 3000
Other assets............................ 0
Total Assets............................ 163000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 95000....(590)......5.19
Secured Debt.................. 37000....(351)......10.22<
Income tax arrears.............5500.....(250)......5
Total secured & HP debts...... 137500....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Capital One....................7800......235.......25.56
HSBC Visa......................8700......220.......21
HSBC overdraft.................1800......0.........20
HSBC bus o/draft...............2000......120.......10.4
HSBC Flexiloan.................2000......135.......19
Total unsecured debts..........22300.....710.......-

Monthly Budget Summary
Total monthly income.................... 2,755
Expenses (including HP & secured debts). 2,820.47
Available for debt repayments........... -65.47
Monthly UNsecured debt repayments....... 710
Amount short for making debt repayments. -775.47
Personal Balance Sheet Summary
Total assets (things you own)........... 163,000
Total HP & Secured debt................. -137,500
Total Unsecured debt.................... -22,300
Net Assets.............................. 3,200

Butti

Hi Grizzled. Others will comment on your routes out of debt. I initially would suggest cutting the following;

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................ 2173
Partners monthly income after tax....... 450
Benefits................................ 132
Other income............................ 0
Total monthly income.................... 2755
Monthly Expense Details
Mortgage................................ 590
Secured/HP loan repayments.............. 601 How long does these run for? Any finishing soon?
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 133
Electricity............................. 91 This seems high to me. Can you change tariff and cut usage.
Gas..................................... 46
Oil..................................... 0
Water rates............................. 50.47
Telephone (land line)................... 40
Mobile phone............................ 25
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 700 This can definately be cut. Some get it down to about £200. Look on the Old Style savers board, start planning meals, reduce trips to the supermarket, always take a list.
Clothing................................ 50 Try to cut this. Focus on buying just for the kids, and then from supermarkets and charity shops. Not easy I know.
Petrol/diesel........................... 180
Road tax................................ 12
Car Insurance........................... 28
Car maintenance (including MOT)......... 25
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 33
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 17
Contents insurance...................... 0
Life assurance ......................... 27
Other insurance......................... 0
Presents (birthday, christmas etc)...... 110 CUT CUT CUT. £1320 per year. Buy for kids. Everybody else cut/make do/make. Put up a request for ideas on here.
Haircuts................................ 40 Try every six weeks and clippers
Entertainment........................... 0 Make sure all these 0 are realistic. Once you have drastically cut food you may be able to put a small amount on entertainment. It will be a slog but you want a plan that you can achieve.
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 2820.47

Assets
Cash.................................... 0
House value (Gross)..................... 160000
Shares and bonds........................ 0
Car(s).................................. 3000
Other assets............................ 0
Total Assets............................ 163000

Secured & HP Debts
Description....................Debt......Monthly.. .APR
Mortgage...................... 95000....(590)......5.19
Secured Debt.................. 37000....(351)......10.22<
Income tax arrears.............5500.....(250)......5
Total secured & HP debts...... 137500....-.........-
Unsecured Debts
Description....................Debt......Monthly.. .APR
Capital One....................7800......235.......25.56
HSBC Visa......................8700......220.......21
HSBC overdraft.................1800......0.........20
HSBC bus o/draft...............2000......120.......10.4
HSBC Flexiloan.................2000......135.......19
Total unsecured debts..........22300.....710.......-

gonzo127

grizzled1 wrote: »

Hello

Sorry to trouble you, but I wonder whether someone would be able to have a look at my SOA below and let me know what they think? I can see there are savings to be made but they seem so woefully small in relation to the amount of debt. We've slipped little by little over the last 16 years and we've finally bumped against the buffers. At the moment, I can't see a way out.

I'm going to contact National Debtline today, but I'm worried we may have even gone beyond a DMP. If we can get one, I'd be glad to get any comments on how people coped with cutting back on children's opportunties, and also dealing with the shame of telling family and friends.

Kind regards and thanks in advance for any advice you can offer.

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 2 - what ages?
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 2173
Partners monthly income after tax....... 450
Benefits................................ 132
Other income............................ 0
Total monthly income.................... 2755
Monthly Expense Details
Mortgage................................ 590 -repayment or interest only?
Secured/HP loan repayments.............. 601
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 133 - paid over 10 months or 12?
Electricity............................. 91 - seems a little high i pay £101 for gas AND electric for a family of 5 with 2 teenages and one baby - do a comparison to see if you can save
Gas..................................... 46
Oil..................................... 0
Water rates............................. 50.47
Telephone (land line)................... 40 - very high, find out who you are calling (mobiles, national, international) and see if you can find a inclusive bundle
Mobile phone............................ 25 - phone them and see if you can drop tarrif or go pay as you go
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 700 - very very very high should be able to halve this with some work
Clothing................................ 50 - once again quite a lot £600 a year on clothes
Petrol/diesel........................... 180
Road tax................................ 12
Car Insurance........................... 28
Car maintenance (including MOT)......... 25
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 33
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 17
Contents insurance...................... 0
Life assurance ......................... 27
Other insurance......................... 0
Presents (birthday, christmas etc)...... 110 - far to high, only buy for your closest of family and should be able to cut by half at least
Haircuts................................ 40 - high again, try a local college who will do it cheaper because the students will be doing it
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 2820.47

Assets
Cash.................................... 0
House value (Gross)..................... 160000
Shares and bonds........................ 0
Car(s).................................. 3000
Other assets............................ 0
Total Assets............................ 163000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 95000....(590)......5.19
Secured Debt.................. 37000....(351)......10.22<
Income tax arrears.............5500.....(250)......5
Total secured & HP debts...... 137500....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Capital One....................7800......235.......25.56
HSBC Visa......................8700......220.......21
HSBC overdraft.................1800......0.........20
HSBC bus o/draft...............2000......120.......10.4
HSBC Flexiloan.................2000......135.......19
Total unsecured debts..........22300.....710.......-

Monthly Budget Summary
Total monthly income.................... 2,755
Expenses (including HP & secured debts). 2,820.47
Available for debt repayments........... -65.47
Monthly UNsecured debt repayments....... 710
Amount short for making debt repayments. -775.47
Personal Balance Sheet Summary
Total assets (things you own)........... 163,000
Total HP & Secured debt................. -137,500
Total Unsecured debt.................... -22,300
Net Assets.............................. 3,200

ok i have made a couple of comments, if you make the above cuts you should be able to get on a DMP (i expect) as with the above comments i would expect you could find at least a £300 a month SURPLUS which would be enough for you to make payments to your creditors on a DMP, yes it will take work on your point, and you will ALL need a change of habits in yoru house but it can be done

if you kids are oldish ~ 8 or above you can explain to them what has happened as kids are surprisingly resistant to things so long as they know whats happening, if they are a bit younger you can still explain but keep it simplier such as mummy and daddy have made some mistakes with money which means we will not be able to do some things that we are used to, however we will still go out places (walks in the park, those sort of free things etc) as the younger children just love to spend time with their parents and most of the time is not about money!

when telling friends and family you do not have to go in to major details, just say you have hit a blib in your finances which you need to deal with so will not be able to go out as much and will just have to stop buying presents for them until it is sorted

believe me you will feel so much better once you have done those things and that presure you are feeling is lifted. just remember you really do not have to keep up with the jones's as if you really got down to it they are probably struggling as it is

Butti

Grizzled,
Not spending money on pressies is easier than you think. A friend of mine knits scarves, I make bags, others make chutneys and jams, and a few years ago I did my friends family tree for her 40th birthday. It cost me a lot of time but only £14.

Beth

muskoka

You have 0 in childcare/nursery, so could your partner go back to work fulltime???

brians_daughter

700 on shopping? This can easily be halved. I have fed 2 adults, 2 kids and 3 cats on £330 pcm - and we eat well!

grizzled1

Thank you Butti, Gonzo, Muskoka and Brian's Daughter for your replies and useful comments. It means a lot.

Butti - £250 of secured loan is for tax arrears. I've gone back into PAYE employment after having been self-employed so should be cleared by 2012. Hadn't thought about trying to trim gas/electricity costs and will investigate. It's good to have even small positive things to do. Clothing, presents and haircuts - I winced even when I typed out the figures. Several difficult conversations to have, I think.

PS If I tried to make chutney or jam as presents, I suspect the fatal effects could soon reduce the number of presents we have to make!

Gonzo - kids are 15 and 12 so can probably cope with a bit of reality as you say. Thanks for your very sane comments on dealing with other people's expectations.

Muskoka - that's a good question and would make a huge difference. I just feel bad about even broaching the subject. Another difficult conversation to have, I think, just may be not right now.

Brian's Daughter - food shopping and cooking is my department so I'm impressed by your example. Will be doing my best to follow.

Thanks again.

theoretica

One of the important opportunities for kids is learning to manage finances.

Have you seen:
http://www.whatsthecost.com/snowball.aspx

If you cut down your spending enough to pay just over the current minimum payments and keep the payments at that level as the debt falls you should be free of unsecured debt in about 3 years- without needing a DMP. I find your groceries and presents bills astonishingly high and believe these would be excellent targets for sorting out your finances while maintaining your standard of living.

savingmummy

You need to reduce major with groceries and presents.
It is very high and can easily be halved.
I only buy for my 2 children, and budget is £50 each at the moment!!

gonzo127

Hi Grizzeled, just want to say a big well done to you for firstly coming on here and seeking help and also for taking all this in, it does take a lot of guts to face up to these things

something to keep in mind incase you think you can do this, as this is how i do it with my 2 teenagers (12 and 17), is to actually show them the budget, let them see where and how money goes to different places, as this will be a big bonus for them in the future as it will make them aware of how to budget from a earlier age than most people get the education, and when you consider most people dont get any education in debt and budgeting until they are in debt and realise what a problem it can be, it would be a great start for your kids budgetting and debt management before they turn into adults and end up in the same situation

however make sure you do budget some money for the kids expenses, so that they dont feel they cant have ANY money, doesnt have to be much but what i would seriously suggest is to make them work for it (teaches them the value of money as well), doesnt have to be hard labour, but set amounts of set jobs and then the money is theres to do what they want with it with NO in put from you! if they want to spend it on junk let them, as this also teaches them how quickly the money you have earned can disappear and leave you nothing to show for it

basically what i am saying is that i believe it would be a good idea to not only tackle your debt you are in now, but to also try and use it to teach your kids about all the problems that can happen when you dont keep track on your finances as they are both at an age where they can understand whats happening and it is something that will hopefully stick with them for the rest of their lives and stop them from making the same mistakes

anyways rather a long post i wish you all the best with things and if you can keep us up to date its always great to see someone dealing with things especially when we are havings a downer ourselves!

jennyo

Hi grizzled1, you have been given some really good advice above, so I don't have anything to add, I'd just like to comment on the first line of your post, the sorry to trouble you bit, it is no trouble, its a debt free wanabee board, but more importantly than that I understand the frame of mind, its what got me in to financial difficulties, which are now cleared, basically I would never ring anyone up, ask if I could get it cheaper, say I didn't want it, I spent my life not being a nuisance, trouble is it costs you. Now I question everything, but always remain polite, get the best deals for us, it is empowering, being in control, best of luck, you can do it.