Saving with debts ...? (now includes SOA)

savingmummy

DGJsaver wrote: »

Your situation could be VASTLY different from the people you `advise` , that why it`s dubious advice..... , i think it`s you who may be confused ?

Someone could owe £100 or they could owe £100k....your advice is coming across very generic....

I`m sorry you think that!
A majority of people have emergency funds included in their monthly outgoings to cover for emergencies.
I totally understand regarding using ALL savings to pay debts, but as edmund has said he is keeping his savings and using what he would normally put in on debts - which is the idea.
Edmunds situation sounds very similar to mine he had debt but not HUGE debts like some - as i don`t know these debts i can only assume they are minor ones.

Everyones circumstances are different i agree! i only give my views on how they can reduce outgoings to help.

edmund_blackadder

vandanfc wrote: »

Are your savings really savings ? What I mean is, are they the pots of money you should be saving each month to pay for car mot/maint/insurance. Savings for birthday/xmas presents, or other such things.

Would it be an idea to post your statement of affairs and see if it can be cut anywhere ?

Yes it certainly would ... I have tried to do one of these in the past but unfortunately I don't have all the figures to hand. I wouldn't want to do one and not show the full picture. Hopefully I can get one sorted out at some point soon.

edmund_blackadder

misscousinitt wrote: »

£3K is a reasonable amount of savings for emergencies. If it worrying you, why don't you halve the money you are saving and throw the other half at the debts.

That way you get the best of both worlds. Best to do some number crunching and see how its all going to help.

Good luck with whatever you decide.

I think this is probably a good idea ... I think sorting out my SOA is required too.

edmund_blackadder

savingmummy wrote: »

I`m sorry you think that!
A majority of people have emergency funds included in their monthly outgoings to cover for emergencies.
I totally understand regarding using ALL savings to pay debts, but as edmund has said he is keeping his savings and using what he would normally put in on debts - which is the idea.
Edmunds situation sounds very similar to mine he had debt but not HUGE debts like some - as i don`t know these debts i can only assume they are minor ones.

Everyones circumstances are different i agree! i only give my views on how they can reduce outgoings to help.

Yes you are right. Although I suppose how huge a debt is is open to interpretation.

Once I sort out my SOA, it should all become clearer.

DGJsaver

savingmummy wrote: »

I`m sorry you think that!
A majority of people have emergency funds included in their monthly outgoings to cover for emergencies.
I totally understand regarding using ALL savings to pay debts, but as edmund has said he is keeping his savings and using what he would normally put in on debts - which is the idea.
Edmunds situation sounds very similar to mine he had debt but not HUGE debts like some - as i don`t know these debts i can only assume they are minor ones.

Everyones circumstances are different i agree! i only give my views on how they can reduce outgoings to help.

Sorry if i came across in an offensive way , i certainly didnt intend to...i have had a crappy afternoon !


And i agree , in the circumstances you describe above , but stick with my view that in your pocket rather than thiers if were talking large debts...

savingmummy

Sorry you`ve had a bad afternoon.
You didn`t come across offensive so don`t worry xx

Edmund - Definately do a SOA. Do take your time with it though to ensure it is infact accurate. Gathering the relavent info/documents is the best thing to do with these. x

Chrisblue1962

Like many contrbutors to this thread, I think there is no right or wrong answer, only one which suits your own situation, which in itself is likely to change from time to time...don't we all know it!

In an ideal situation, i.e where current endebtedness does not block access to emergency funding, say by a credit card, it makes no sense to carry debts and savings as the debt will cost more than the savings earn.

However...my situation, like many folks, is no access to emergency funding (credit card) and debt s to pay. So, I think its perfectly valid to maintain debt repayments at acceptable level and if possible build up savings as follows, in order of importance:

• Emergency Fund of say £250.00 to £1000.00 - Genuine household emergencies only!
• "Overdraft" Fund of say £100.00, which can be dipped into only to prevent going overdrawn with the bank before pay day and thus incurring bank charges. But must be topped back up to £100.00 within 3 months for example.
• Treat Fund of £25.00 to £100.00 - for occasional treats.
• Christmas Fund of £250.00
• Holiday Fund of £500.00 - annual hoilday, even if only a weekend away.

Total Funds Target: £1125.00 to £1850.00

As Ronnie Barker once said in Porridge "All work no play makes Jack a dull beanstalk..", hence Funds for Treats, Christmas and if possible, a modest holiday.

Thoughts o your good selves most welcome. BFN :hello:

edmund_blackadder

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.................... 2
Monthly Income Details
Monthly income after tax................ 1519
Partners monthly income after tax....... 1300
Benefits (Child)........................ 132.8
Other income (DLA)...................... 281.4
Total monthly income.................... 3233.2
Monthly Expense Details
Mortgage................................ 556
Secured/HP loan repayments.............. 119

Council tax............................. 123
Electricity............................. 45
Gas..................................... 78
Water rates............................. 33.38
Telephone (land line)................... 17
Mobile phone............................ 20.31
TV Licence.............................. 11.95

Groceries etc. ......................... 240
Clothing................................ 60
Petrol/diesel........................... 30
Road tax................................ 15
Car Insurance........................... 33.21
Car maintenance (including MOT)......... 0

Childcare/nursery....................... 160
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 14
Pet insurance/vet bills................. 17.99
Buildings & Contents insurance.......... 42.73
Life assurance ......................... 12.95
Presents (birthday, christmas etc)...... 20
Haircuts................................ 6
Entertainment........................... 200
Holiday................................. 200
Emergency fund.......................... 75
Mandatory Org Membership for Job........ 19.18
IKEA Overpayments....................... 55
Double Glazing Loan Overpayments........ 300
Mortgage Overpayment.................... 160
DD Account.............................. 25
DS Account.............................. 20
Choir (Daughter)........................ 10
Boiler and Appliance Cover (British Gas) 43.66
Total monthly expenses.................. 2763.36

Assets
Cash.................................... 3000
House value (Gross)..................... 140000
Shares and bonds........................ 0
Car(s).................................. 6000
Other assets............................ 0
Total Assets............................ 149000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 121614...(556)......2.5
Hire Purchase (HP) debt ...... 2948.....(119)......17.24
Total secured & HP debts...... 124562....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
IKEA Card......................512.......19.06.....19.9
Double Glazing.................2874.7....68........21.13
Natwest Loan...................2600......103.......NaN
Total unsecured debts..........5986.7....190.06....-

Monthly Budget Summary
Total monthly income.................... 3,233.2
Expenses (including HP & secured debts). 2,763.36
Available for debt repayments........... 469.84
Monthly UNsecured debt repayments....... 190.06
Amount left after debt repayments....... 279.78
Personal Balance Sheet Summary
Total assets (things you own)........... 149,000
Total HP & Secured debt................. -124,562
Total Unsecured debt.................... -5,986.7
Net Assets.............................. 18,451.3
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.


**Unfortunately we are very rarely left in as much credit as it implies so clearly there is a whole load of miscellaneous spending (not direct debits etc) that are not reflected in the SOA.

savingmummy

edmund_blackadder 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.................... 2 do you need 2?
Monthly Income Details
Monthly income after tax................ 1519
Partners monthly income after tax....... 1300
Benefits................................ 132.8
Other income............................ 281.4
Total monthly income.................... 3233.2
Monthly Expense Details
Mortgage................................ 556
Secured/HP loan repayments.............. 119
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 123 is this over 10 or 12 months? you can have it over 12 if you wish too.
Electricity............................. 45
Gas..................................... 78 this is high have you shopped around for cheaper?
Oil..................................... 0
Water rates............................. 33.38
Telephone (land line)................... 17
Mobile phone............................ 20.31
TV Licence.............................. 11.95
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 240
Clothing................................ 60 can this be reduced? use what you have and buy only when needed.
Petrol/diesel........................... 30 for 2 cars?
Road tax................................ 15
Car Insurance........................... 33.21
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 160
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 14
Pet insurance/vet bills................. 17.99
Buildings insurance..................... 42.73
Contents insurance...................... 0
Life assurance ......................... 12.95
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 6
Entertainment........................... 200 this can be reduced it seems very high
Holiday................................. 200 :eek:a month? wow!
Emergency fund.......................... 75
Mandatory Org Membership for Job........ 19.18
IKEA Overpayments....................... 55
Double Glazing Loan Overpayments........ 300
Mortgage Overpayment.................... 160
DD Account.............................. 25
DS Account.............................. 20
Choir (Daughter)........................ 10
Boiler and Appliance Cover (British Gas) 43.66
Total monthly expenses.................. 2763.36

Assets
Cash.................................... 3000
House value (Gross)..................... 140000
Shares and bonds........................ 0
Car(s).................................. 6000
Other assets............................ 0
Total Assets............................ 149000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 121614...(556)......2.5
Hire Purchase (HP) debt ...... 2948.....(119)......17.24
Total secured & HP debts...... 124562....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
IKEA Card......................512.......19.06.....19.9
Double Glazing.................2874.7....68........21.13
Natwest Loan...................2600......103.......NaN
Total unsecured debts..........5986.7....190.06....-

Monthly Budget Summary
Total monthly income.................... 3,233.2
Expenses (including HP & secured debts). 2,763.36
Available for debt repayments........... 469.84
Monthly UNsecured debt repayments....... 190.06
Amount left after debt repayments....... 279.78 this is a good amount left over do you use this? could this go on a debt each month?
Personal Balance Sheet Summary
Total assets (things you own)........... 149,000
Total HP & Secured debt................. -124,562
Total Unsecured debt.................... -5,986.7
Net Assets.............................. 18,451.3
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.


**Unfortunately we are very rarely left in as much credit as it implies so clearly there is a whole load of miscellaneous spending (not direct debits etc) that are not reflected in the SOA.

I have added my 2 pennies worth
Good luck hunni xx

edmund_blackadder

I intend on cancelling the £75 (Emergency) contributions to the Savings pot (£3000) and adding it to the £300 overpayment for the double glazing. Once I have done this I will move on to the Ikea card (which shouldn't take long), then I'll move on to the Car HP, then the Natwest Loan.

Once they are all paid off, any spare cash will be put towards mortgage.

That sound sensible-ish?