How do you say No to things you really need

Norfolk_Jim

The advise on these boards is generally pretty much the same, cut back to the bare bones, live frugally, pay off debt for umpty years and nver go back again - thats pretty much my approach except that I do end up going back again.
In the past, as I've seen things developing I've slammed on the spending breaks and come out safely on the other side but in the past few years I've really come off the road and into the ditch.
First off, I have a really unsupportive, unsympathetic wife & kids. They take the view that no matter what "Jim'll fix it" and I suppose since in the past I always have, why would they think differently? I've done everything I could think of - sought advise/support on here, showed them the budget, showed them the board - they talk a good talk then carry on as normal.
Then I had a mental breakdown under all the stress. Have been nursed through it by my employer and back to full time working after 2 years of ill health, during which my debts have gone from £2000 to £24000 or so (in no position to defend myself).
Luckily, for now I can manage debt at this level but I hate being so vulnerable to any downturn. were just one disaster away from financial meltdown - like if I get sick again - which gives me a lot of worry.
I've now persuaded the wife that we should sell the house and downsize if we can - its on sale now but who knows how long it'll take to sell.
So in the meantime I'm trying to apply the spending breaks. Trouble is that although I have a balanced budget with around £200 of discretionary income after the payments go out - this is always consumed by non anticipated expenses.
With no savings at all, these emergencies hammer my attempts to pay off debt and month on month my debt still creeps up. Not as fast as before but always up. Theres times I feel like, lets just live happy till the kids are up and away and then go bankrupt? Then I feel guilty for having such an irresponsible thought, since I have always paid everyone everything I owe.
I get a lot of help from reading all your diferent situations but theres not much there I see in how to deal with real difficult unexpected bills, heres some of my recent ones.

The dog breaks its leg (yeah, I know, your in debt and you have a dog? Are there no pounds out there? Very Dickens) and its not insured. Do I kill the dog or pay the very £1000 to fix it. I get paid too much to get help from PDSA.

The wife breaks her teeth and the dental plan only covers half the bill now. Do I leave her in pain or fork out £300 on my flexible fiend to get them fixed right away?

The wife breaks her glasses (again), another £40 to Specs Direct or let her stumble about bumping into things.

The Boiler, having been nursed along for 12 years and well past its commercial lifetime, dies, and its freezing. Buy a new one I cant afford or extra jumpers all round?

Ok I'm being flippant but these are real choices I've had to face recently

The car hits a dirty great big pot hole - Do I pay to get the tracking sorted or fingers crossed and hope I dont end wearing my tyre out fast? (This is current)

I need clothing for my job, 2 specialist outfits and 2 sets of smart casuals (I'm the scruffiest person at work with holes in my clothing - no kidding - but I'm supposed to be a professional), I can maybe get the smar casuals from Tesco for £40(?) But the specialist clothing is a lot more, maybe £200. Theres no Budget for clothing in our budget, I wear gifts and charity shop finds (and to be fair to Mrs jim, much of the time so does she)
I'm worried that having been so good to me, my bosses will lose patience with me.

We used to feed ourselves on £2 a day, but now I find my £60pw groceries & household budget isnt enough? result - I eat less and feed the wife & kids, but obviously there will come a point. OT and Frugal living would help but I'm at work long hours and Mrs Jim wont play ball. So we overspend on food even though I'm well unhappy about it.

The car breaks down - I work 25 miles away and theres no bus. It has to be fixed (we are moving closer to work and on a bus route once house sells but in the meantime?) It has to be financed somehow?

Thats just a few examples. Any one of them alone and I might find a way -daily clicks - cashback shopping - selling something. Its just that they seem to come one thing after another in a never ending stream.

Oh well - Despairing rant over - I know - post you SOA and we'll tell you to get rid of the dogs, ditch the Sky, eat beans and sit in the dark.
I've done all of that before, and worse.

Living alone I truely believe this would never have got so bad as I can impose any kind of austerity on myself and be untroubled - in fact the happiest I've ever been was living in a concrete shack in the Malawi bush (helping a charity help poor farming communities) with no Tv, no electricity, no shops and just a bed and two sets of clothing. That was bliss. But When it comes to others, the wife, the kids, its another matter.

What do you all do when something unexpected comes your way and you have no money to pay it?

JimmyTheWig

A great post, Norfolk_Jim. You raise some good, difficult points.

I believe that the key to it is a good budget.
Your budget needs to include money for things like the above

You need to agree the budget with your wife (and the kids if they are old enough).
Then you need a plan to stick to your budget. What worked for us (not disimilar to you in that my wife is much happier to spend money than I am, though thankfully we are not really in debt) was breaking down what was left into weekly money (much more managable than monthly money) and taking that amount out in cash at the start of each week. Once it's gone it's gone.
(For a while we tried daily money. It was quite effective, but it didn't last long.)

Once you've got an accurate budget you can start looking at how to get some of your budgetted items down, giving you more money to pay off debts and/or (for your wife) to spend.

Norfolk_Jim

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................ 1316.49
Partners monthly income after tax....... 0
Benefits................................ 410.67
Other income............................ 0
Total monthly income.................... 1727.16
Monthly Expense Details
Mortgage................................ 210
Secured/HP loan repayments.............. 113
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 116
Electricity............................. 66
Gas..................................... 30
Oil..................................... 0
Water rates............................. 37.57
Telephone (land line)................... 14
Mobile phone............................ 25
TV Licence.............................. 12
Satellite/Cable TV...................... 24
Internet Services....................... 30
Groceries etc. ......................... 300
Clothing................................ 0
Petrol/diesel........................... 200
Road tax................................ 15
Car Insurance........................... 29
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 80
Medical (prescriptions, dentist etc).... 70
Pet insurance/vet bills................. 25
Buildings insurance..................... 15
Contents insurance...................... 10
Life assurance ......................... 10.48
Other insurance......................... 53
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 20
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1680.05

Assets
Cash.................................... 0
House value (Gross)..................... 165000
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 166500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 40000....(210)......2.49
Secured Debt.................. 17500....(113)......3.99
Total secured & HP debts...... 57500.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard LOB................6059......135.......0.7
Virgin.........................1600......40........0
Total unsecured debts..........7659......175.......-

Monthly Budget Summary
Total monthly income.................... 1,727.16
Expenses (including HP & secured debts). 1,680.05
Available for debt repayments........... 47.11
Monthly UNsecured debt repayments....... 175
Amount short for making debt repayments. -127.89
Personal Balance Sheet Summary
Total assets (things you own)........... 166,500
Total HP & Secured debt................. -57,500
Total Unsecured debt.................... -7,659
Net Assets.............................. 101,341
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.

GeorgeUK

Hi Jim, sounds like you're having a really tough time of it.
(Personally i'd tell you to keep the dog, only allow the wife t ouse a debit card with no overdraft and tell the kids to get a job if they want spending money or clothes).

Anyway, where's the SOA?
I would have thought that after you became ill you would have had more support, but if that's not happening i think your only option is to restructure how the bills get paid and who has access to money and how much. Does the wfe work?

Hope you're okay otherwise. We're not all doom and gloom you know (just a little bit miserable now and again).

Little_Vics

very good post. I don't think you're alone. Our solution at the moment is an empty credit card with 0% purchases until we can save (yeah right!) an emergency fund. I just need to know we've got access to money if we need it, so have hung onto that card.

Tixy

Hi Jim

When I read the title to this post I wasn't expecting the scenarios you have posted (in truth I admit I was expect it to be talking about luxuries people convince themselves are needs) but the items you have listed do look mostly essential to me (and I would never say get rid of the dog to anyone, though I might say don't get a dog to someone who doesn't already have one - the sky but well I might say get rid of sky but only becasue I've never had it and don't see the need).

Of course I don't think anyone is going to post all the answers on here you need but a couple of things I thought was it seems to me that your budget doesn't include everything you need. I would budget something for clothing each month, at some point you are going to need some and from the sounds of it in your job you certainly are.

And I would include in the budget car expenses and something for medical costs. I know it won't mean you have any more money but by having these sort of items in your budget it may be that you actually can't afford to service your current debts.

As for the big items such as the dog and the boiler, well no amount of budgeting or emergency fund is going to free up that kind of amount of money. If something along these lines happened to me I know I would either reach for more credit or look to see if I can slow down my current debt repayments (perhaps take a payment break on a loan or something similar?)

Regarding the family and the things like the grocery budget, I don't know the answers (I'm single!) but has the grocery spending been allowed to gradually slip? food costs have not really gone up recently (or where they have lower costs items have appeared beneath them) so if you used to manage of that amount then I would think you still can. Does Mrs Jim do the shopping or do you? Have you got into the habit of buying the same things each week without looking for cheaper alternatives or more filling foods? Have you considered grocery shopping online so you can have more input?
How old are the kids?, can you get them on board somehow? If they are small make it a game to look for cheaper foods, or if they are older challenge them to feed themselves on £1 a day for a week (or whatever) so they understand the cost of food.

Its really hard that you seem to have had a string of costly items all happening one after the other. Good luck on selling your house and I wish there was a solution or answer out there for you.

Have you recently had any professional advice? I wonder if that might be an option to see whether something such as bankruptcy or an IVA may be something for you to consider?

Tixy

Hi again

On the budget you are showing a shortall not the £200 you had estimated? Hopefully the road tax is incorrect? You do need to budget something for MOT, servicing, tyres etc (okay it won't cover a huge repair but would help deal with the smaller items).

You need a clothing budget.

Your groceries budget could be a litle less, if you can't get Mrs Jim onboard could you make time to go shopping with her a couple of times so that you can work together, maybe she can see that there are savings to be made.

If you don't want to get rid of sky I'm certain you can get a cheaper media package (landline, tv, internet - £68) try combining them to get the cheapest deal - which I think is around £40?

Whats in medical? is it the dental plan, are you getting more benefit than you pay out (bearing in mind it didn't cover all the costs for OH).

Other insurance? is this income protection? is it the cheapest available?

Can Mrs Jim find employment? is she claiming JSA?

Just a few quick thoughts (none of them mentioning just eating beans!)

GeorgeUK

Mortgage................................ 210
Interest only or repayment?

Council tax............................. 116
Is this over 10 months or 12?

Electricity............................. 66
Gas..................................... 30
I'd check the meter readings with the companies and see if you are in credit.
Change to energy saving light bulbs and make sure everything is turned off at the plug if not in use - not standby.
Check the comparison sites to make sure you are getting the best deal (uswitch, moneysupermarket)

Water rates............................. 37.57
Is this metered? Do you have a water hippo or similar in your cistern to use less water?

Mobile phone............................ 25
PAYG?

Telephone (land line)................... 14
Satellite/Cable TV...................... 24
Internet Services....................... 30
Is this a package deal?

Groceries etc. ......................... 300
She's having a laugh!!
You might even be able to halve this. Are meals planned or do you just go around the shops and pick what you fancy? I would suggest a meal plan for the month and then only buy those ingredients - buy in bulk and freezemeals.

Clothing................................ 0
Something needed here (I know what you said before, but it would be better to budget for this)

Petrol/diesel........................... 200
Road tax................................ 190
Ouch!! Would it be possible to trade in for a smaller car?

Pet insurance/vet bills................. 25
Buildings insurance..................... 15
Contents insurance...................... 10
Life assurance ......................... 10.48
Other insurance......................... 53
Again i would shop around to make sure you get the best deal - also use a cashback site like quidco.

Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Emergency fund.......................... 0
Something needed here.

gonzo127

Norfolk_Jim wrote: »

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................ 1316.49
Partners monthly income after tax....... 0
Benefits................................ 410.67 - are you sure you are getting all benifits check entitled to website
Other income............................ 0
Total monthly income.................... 1727.16
Monthly Expense Details
Mortgage................................ 210
Secured/HP loan repayments.............. 113
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 116
Electricity............................. 66
Gas..................................... 30
Oil..................................... 0
Water rates............................. 37.57
Telephone (land line)................... 14
Mobile phone............................ 25
TV Licence.............................. 12
Satellite/Cable TV...................... 24
Internet Services....................... 30 - this is quite high by modern standards check samknows website to find who does LLU in your area and look at swopping if you can
Groceries etc. ......................... 300 - i know people do better but i dont think this is too bad you might be able to do better with tthe drop a brand challenge
Clothing................................ 0
Petrol/diesel........................... 200
Road tax................................ 190 - typo i hope!
Car Insurance........................... 29
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 80
Medical (prescriptions, dentist etc).... 70 - this seems a lot
Pet insurance/vet bills................. 25
Buildings insurance..................... 15
Contents insurance...................... 10
Life assurance ......................... 10.48
Other insurance......................... 53 - whats this?
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 20
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1680.05

Assets
Cash.................................... 0
House value (Gross)..................... 165000
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 166500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 40000....(210)......2.49
Secured Debt.................. 17500....(113)......3.99
Total secured & HP debts...... 57500.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard LOB................6059......135.......0.7
Virgin.........................1600......40........0
Total unsecured debts..........7659......175.......-

Monthly Budget Summary
Total monthly income.................... 1,727.16
Expenses (including HP & secured debts). 1,680.05
Available for debt repayments........... 47.11
Monthly UNsecured debt repayments....... 175
Amount short for making debt repayments. -127.89
Personal Balance Sheet Summary
Total assets (things you own)........... 166,500
Total HP & Secured debt................. -57,500
Total Unsecured debt.................... -7,659
Net Assets.............................. 101,341
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.

made a couple of comments i think you should be fine as i think a type in there (road tax) is causing it to be a deficcuit and not a surplus!

vandanfc

Road tax................................ 190

Is this right or does it include other things such as maintenance ?

What is other insurance ?

How old are your children - can they get part time jobs ? Do you give them pocket money ? If so how much ?

brians_daughter

Hi Jim, i too worry about unavoidable but needed additional costs. I have overcome this by budgeting correctly.

I m not going to advise on SOA here but i will tell you how i have managed things on my DFW journey

I have...wait for it...5 bank accounts..

1. money gets paid into
2. Bills come out of
3. ongoing costs MOT money, clothing allowance, car tax etc - basically money that isnt in DD for but i know it will need paying
4. shopping allowance
5.Whats left goes in here for rainy day...trust me there isnt much in it but even if i have £10 per month left it goes in here

It all builds up, yes it takes time to administer, yes my oh thinks i have lost the plot...but most importantly yes it helps!

Shopping can easily be cut - this IMO is the easiest thing to control

I shop for 2 adults and 2 kids on less than £200 pcm. We dont eat beans...infact i cant stand them but simple things like cooking in batch really works. Things like chilli, spag bol, lasagne etc i cook once a month and make enough to see us through 1 meal a week of each.

Last month my shopping bill was £213 but that did include 10 lots of sirlion steak i bought when on 'better than 1/2 price' in asda.

What i am trying to say is if you start small, come 6 months from now you will have the additional money to ease the emergency situations. Ok in the mean time emergencies may have to ne financed on the cc, and thats unfortunate (in no way am i advocating getting further in debt but sometimes thats a way of life)

Most importantly you need you oh and the kids, if of reasonable age, onside to make this work.