Help: Decent income being lost to debt

S_AND_I

Hi - Finally hit home when my wife wasn't earning (end of maternity leave) that despite both having good jobs (she's part time now), we were simply chucking money away and not paying back debt. :mad: Below is SOA, but we've been inspired by the MSE board to do the following in January.

Paid off 233.40 credit card using bonus.

Cutback Sky to minimum.
Sold £40 of stuff on ebay, old mobile (£12.10)
Shopped once using the down-branding method and once using a £15 off online voucher
£50 from family member as birthday gift
Counted various other savings
to a total of £192.12

Plus minimum payments of £284.38 - equals £709.90 paid off in Jan!:j:beer:

We've recently switched gas/elec, are in process of putting overdrafts onto spare 0% CC and getting better current accounts with cashback, using cheaper intl calls services, trying to understand cashback sites, trying to stop non-essential purchases.

We're very pleased with our start, but would love you guys to look over the below:
Non-options are a) getting rid of the cleaners b) selling the car


Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 3338
Partners monthly income after tax....... 920
Benefits................................ 80
Other income............................ 229.75
Total monthly income.................... 4567.75
Monthly Expense Details
Mortgage................................ 693.8
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 127
Electricity............................. 45
Gas..................................... 42.5
Oil..................................... 0
Water rates............................. 40
Telephone (land line)................... 30
Mobile phone............................ 30
TV Licence.............................. 12.12
Satellite/Cable TV...................... 28
Internet Services....................... 0
Groceries etc. ......................... 440
Clothing................................ 100
Petrol/diesel........................... 100
Road tax................................ 12.92
Car Insurance........................... 29.66
Car maintenance (including MOT)......... 23.25
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 443
Other child related expenses............ 150
Medical (prescriptions, dentist etc).... 60
Pet insurance/vet bills................. 0
Buildings insurance..................... 20
Contents insurance...................... 10.79
Life assurance ......................... 27.36
Other insurance......................... 20.8
Presents (birthday, christmas etc)...... 30
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Payment to dad for car.................. 250
Cleaners................................ 98
Total monthly expenses.................. 2864.2

Assets
Cash.................................... 0
House value (Gross)..................... 215000
Shares and bonds........................ 0
Car(s).................................. 10000
Other assets............................ 0
Total Assets............................ 225000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 190000...(693.8)....1.99
Total secured & HP debts...... 190000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
I Overdraft....................3500......41.27.....20.9
S Overdraft....................3000......13.43.....9.9
I Barclaycard..................1233.35...23.38.....0
S Barclaycard..................11584.....261.2.....5
Total unsecured debts..........19317.35..339.28....-

Monthly Budget Summary
Total monthly income.................... 4,567.75
Expenses (including HP & secured debts). 2,864.2
Available for debt repayments........... 1,703.55
Monthly UNsecured debt repayments....... 339.28
Amount left after debt repayments....... 1,364.27
Personal Balance Sheet Summary
Total assets (things you own)........... 225,000
Total HP & Secured debt................. -190,000
Total Unsecured debt.................... -19,317.35
Net Assets.............................. 15,682.65
Created using the SOA calculator at Make Sense of Cards.
Reproduced on Moneysavingexpert with permission, using IE browser.

Oneday77

S_AND_I wrote: »

Hi - Finally hit home when my wife wasn't earning (end of maternity leave) that despite both having good jobs (she's part time now), we were simply chucking money away and not paying back debt. :mad: Below is SOA, but we've been inspired by the MSE board to do the following in January.

Paid off 233.40 credit card using bonus.

Cutback Sky to minimum.
Sold £40 of stuff on ebay, old mobile (£12.10)
Shopped once using the down-branding method and once using a £15 off online voucher
£50 from family member as birthday gift
Counted various other savings
to a total of £192.12

Plus minimum payments of £284.38 - equals £709.90 paid off in Jan!:j:beer:

We've recently switched gas/elec, are in process of putting overdrafts onto spare 0% CC and getting better current accounts with cashback, using cheaper intl calls services, trying to understand cashback sites, trying to stop non-essential purchases.

We're very pleased with our start, but would love you guys to look over the below:
Non-options are a) getting rid of the cleaners b) selling the car


Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 3338
Partners monthly income after tax....... 920
Benefits................................ 80
Other income............................ 229.75
Total monthly income.................... 4567.75
Monthly Expense Details
Mortgage................................ 693.8
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 127
Electricity............................. 45 Is that the new switched costs?
Gas..................................... 42.5 Same
Oil..................................... 0
Water rates............................. 40 Get a meter
Telephone (land line)................... 30 Try combining the full interent\TV\Calls
Mobile phone............................ 30
TV Licence.............................. 12.12
Satellite/Cable TV...................... 28
Internet Services....................... 0
Groceries etc. ......................... 440 Vist the old Style board, this could be just about halved.
Clothing................................ 100 Can you make stuff last longer, £1200 a year on clothes?
Petrol/diesel........................... 100
Road tax................................ 12.92
Car Insurance........................... 29.66 Shop about
Car maintenance (including MOT)......... 23.25 How old is the car, can you get servicing cheaper.
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 443 Are you using childcare vouchers, read on the ups & downs for them.
Other child related expenses............ 150
Medical (prescriptions, dentist etc).... 60
Pet insurance/vet bills................. 0
Buildings insurance..................... 20 Combine house insurances, you can move from the mortgage provider.
Contents insurance...................... 10.79
Life assurance ......................... 27.36
Other insurance......................... 20.8 What's this?
Presents (birthday, christmas etc)...... 30
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Payment to dad for car.................. 250
Cleaners................................ 98 Do you really need this?
Total monthly expenses.................. 2864.2

Assets
Cash.................................... 0
House value (Gross)..................... 215000
Shares and bonds........................ 0
Car(s).................................. 10000
Other assets............................ 0
Total Assets............................ 225000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 190000...(693.8)....1.99
Total secured & HP debts...... 190000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
I Overdraft....................3500......41.27.....20.9 Can you get deals to switch these ODs to your CCs on low rates?
S Overdraft....................3000......13.43.....9.9
I Barclaycard..................1233.35...23.38.....0
S Barclaycard..................11584.....261.2.....5
Total unsecured debts..........19317.35..339.28....-

Monthly Budget Summary
Total monthly income.................... 4,567.75
Expenses (including HP & secured debts). 2,864.2
Available for debt repayments........... 1,703.55
Monthly UNsecured debt repayments....... 339.28
Amount left after debt repayments....... 1,364.27
Personal Balance Sheet Summary
Total assets (things you own)........... 225,000
Total HP & Secured debt................. -190,000
Total Unsecured debt.................... -19,317.35
Net Assets.............................. 15,682.65
Created using the SOA calculator at Make Sense of Cards.
Reproduced on Moneysavingexpert with permission, using IE browser.

You are in OK shape but there is space to improve if you want to. WIth extra savings you could clear both ODs in 4 months aim on them furst as they are costing you the most.

Horace

Cleaners are a luxury you can't afford - there is no reason why your wife and you can't do the cleaning between you.

£440 a month on groceries for 2 adults and a child is excessive and can be cut by at least half - look on the Moneysaving Oldstyle board elsewhere on this forum for tips on meal planning, dropping a brand in the supermarket etc.

Clothes - shop from your wardrobe instead - spending £100 a month on clothes is too much, baby clothes can be acquired cheaply in a charity shop.

Keep a spending diary to see where you are frittering money away.

slummymummyof3

Do you pay your council tax over 10 or 12 months - if it is 10, you will have Feb and March council tax free.

Do you really need cleaners?

Do you really need £100 per month on clothes?

Life insurance is expensive - is this a policy that has been running a long time as policies have come down lots in the last 5 years or so. May be worth having a shop about and check out cash back sites for it, while you are at it!

Grocery bill you could probably chop back by at least £100. Do you have an Aldi or Lidl nearby - they have amazingly priced fruit/veg and we have not been diappointed with anything we have tried to date. I only go to Sainsburys for their BOGOF's on things I use now (check mysupermarket.co.uk to compare offers between the big 4)

What is the £150 'other child related expenses' - can't just be nappies and formula milk?????

You could get a better home phone/broadband/satellite tv deal - who are you with?

S_AND_I

Hi guys,
Some great ideas. Elec/gas is switched but waiting to see if DD is realistic as they would not budge, water meter would be more for bath lovers, we're already working on the groceries and clothes (the latter may be a bit high of a guess but will start a diary - as you can see I have a few gaps in the SOA as I don't know where that money goes), ODs are going onto 0% CC tomorrow (tried to charge me a 4% handling fee on the web rather than 2.98% with a cheque!). Will look into all the other ideas.

Cleaners keep us sane but perhaps can cut down.

Other insurance is income protection, which nearly got used as our office was amalgamated into one in London (25% loss of staff). Once the month of trial is over (mid-February) and I can have more confidence in having a job I'll lose it.

S_AND_I

slummymummyof3 wrote: »

Do you pay your council tax over 10 or 12 months - if it is 10, you will have Feb and March council tax free.
Forgot that - would beed adjusting
Do you really need cleaners?
See above
Do you really need £100 per month on clothes?
See above
Life insurance is expensive - is this a policy that has been running a long time as policies have come down lots in the last 5 years or so. May be worth having a shop about and check out cash back sites for it, while you are at it!
It's about seven so worth a look.
Grocery bill you could probably chop back by at least £100. Do you have an Aldi or Lidl nearby - they have amazingly priced fruit/veg and we have not been diappointed with anything we have tried to date. I only go to Sainsburys for their BOGOF's on things I use now (check mysupermarket.co.uk to compare offers between the big 4)
There is a Lidl in the next town. Focusing on getting the best from the web first but will give it a shot next time we're over there. Easing my way in as frankly have that English 'you are where you shop' disease. Need to change my outlook, methinks, as I've never stepped inside a Lidl yet my parents swear by it.
What is the £150 'other child related expenses' - can't just be nappies and formula milk?????
Again, bit of a guess really - diary coming soon.
You could get a better home phone/broadband/satellite tv deal - who are you with?

Going to look at Sky - but always been a touch worried at having all eggs in the same basket. Last week cut out unused sky channels but they wouldn;t budge on 'I'm going to leave' threat - yet.

slummymummyof3

Have you both tried keeping a spending diary and recording everything you are spending - sandwiches/coffee and newspapers at work soon add up without your realising!

MrsTinks

S_AND_I wrote: »

Hi guys,
Some great ideas. Elec/gas is switched but waiting to see if DD is realistic as they would not budge, water meter would be more for bath lovers, we're already working on the groceries and clothes (the latter may be a bit high of a guess but will start a diary - as you can see I have a few gaps in the SOA as I don't know where that money goes), ODs are going onto 0% CC tomorrow (tried to charge me a 4% handling fee on the web rather than 2.98% with a cheque!). Will look into all the other ideas.

Cleaners keep us sane but perhaps can cut down.

Other insurance is income protection, which nearly got used as our office was amalgamated into one in London (25% loss of staff). Once the month of trial is over (mid-February) and I can have more confidence in having a job I'll lose it.

Well don't mean to sound harsh - but if your wife is only working part time then she can surely do the cleaning? That's just shy of £1176 PER YEAR you are paying out on cleaners... I'm returning to work full time this week after ML and I'm umming and ah-ing about getting a cleaner in two hours every second week because it'll cost me £40 a month. That's not to do all my cleaning but to help me stay on top...
Clothes... £100 per month - again this is £1200 per year - that's a lot... My husband wears suits to work and I have to be smart too - that means either suit or similar. Even counting my daughters clothes into it I'd struggle to spend £20 a month with the odd splurge when there is a bonus. Freecycle for baby clothes and buy a few good quality items that can be matched with loads of other things to make several outfits.
Food... Again if your wife is only part time she should have some time to cook meals from scratch - £440 is a lot of money to spend on food - well it is if you are trying to be debt free

All these exspenses are fine... if you can afford them. If you want to be debt free however then you need to reduce them drastically. Once you're free of these debts you can obviously spend what you want Or... novel idea... you could save up for holidays, nice clothes, cars...

slummymummyof3

I really suggest you give your local Lidl a try - make sure you take your own carrier bags!

Their fruit/veg, chilled meats, toiletries etc are all safe bets. Having avidly shopped in Tesco or Sainsbury's for years, I was 'converted' to Aldi and Lidl about 15 months ago and have not been disappointed with a purchase yet. I cannot bring myself to spend in somewherre like Tesco now. Each time I go to Aldi and Lidl, I try something new - a case of gaining confidence I suppose.

Virgin media were offering £150 cash back on the cash back sites last week - don't know whethr that is still available or not????

Have you tried Talk talk? There were also deals on O2 broadband on cash back sites.

S_AND_I

MrsTine wrote: »

Or... novel idea... you could save up for holidays, nice clothes, cars...

That's where we're aiming for.:)

Yes, we're trying to make sure we know what we're spending on to make informed decisions. Admission time: I think we may have new parent syndrome, where anything but the best is some form of child torture! We've got that in check in recent months but should be able to do more.

Cleaning - only started recently and - other than starting this MSE process - is the single thing that has improved all three of our moods, tiredness, etc. It's a luury we feel is worth paying for now we hardly ever go to the cinema, rarely go for an evening of drinks and now spend most weekends using National Trust membership rather than going to the shops. This process for us is not entirely about clearing the debt in record time, it's about feeling a) in control and b) feeling happy.

S_AND_I

slummymummyof3 wrote: »

I really suggest you give your local Lidl a try - make sure you take your own carrier bags!

I think we will. But baby steps - jumping from Sainsbury's top notch brand to Lidl basics might derail things.