Money makes the world go round and my head spin with it

Jak1986

Hey everyone ,

So me…I’m 23 yrs old living with my fiance and have nearly £13,000 worth of debt to my name. This may not seem a lot to others but to me its everything.
How I got myself into this is easy…. car’s, holiday’s and shopping!!
I come from a family of hard workers and harder savers…mum say’s she’s not sure what happened to me as im the only one in the family with money issues...
I stress and worry over this on a daily basis making lists upon lists of what I have coming in and what I have going out. The figures worry me, as I would love to be able to go out and do things not only with my fiance but also with my friends and family but don’t have the finances to do anything.
It always seems like an up hill struggle but I know it will all be over some day (later than sooner unless the lottery plays in my favour *fingers crossed*) and I believe this is my first step to making this happen.
By letting the world know that I am standing up to my debt problems will hopefully help me not be as stressed and take a load off my mind.
To have any kind of feedback on how I can reduce my monthly outgoings’ with loans etc or even just words of encouragement and support would be great and most definitely appreciated.

Here goes….

Debts:
Loan from Mum: £3000
Argos store card: £272.84
Abbey loan: £7685.16 (Final repayment July 2013)
Abbey overdraft: £700
Tesco credit card: £1022.96 (Must be paid by Aug 2010, interest is then added!)


My monthly salary - £1,150

Monthly Outgoings:
Rent - £225
Gas - £10
Electric - £10
Food - £80
TV License - £11.93
Phone - £55
Car Insurance - £33.57
Petrol - £40
Abbey Loan - £182.98
Loan from Mum - £200
Argos store card - £50
Tesco credit card - £50

Thanks
J

niccatw

Hey J

You've come to the right place! It really helped me destress and take control a lot more - which I really needed to do as I was making myself ill!

Initial thought looking at what you've said - is the loan from your mum a personal loan (i.e. from her money, rather than her taking a loan out in her name for you?). If so, any chance you could negotiate with her, at least for the next 6 months until the credit card is paid off before you start having to pay interest on it. By my calculations (double check them - they're not always reliable ) you need to be paying £180 a month (rounded up) to that credit card.

It will help people advise if you could do your statement of affairs in the format provided by this website http://www.makesenseofcards.com/soacalc.html

Also have a play about with the snowball calculator on that site to help you see which debts you should be paying first and the difference in possible debt free dates, depending what money you have to throw at them.

Good luck

pinkneonmartini

Jak1986 wrote: »

Debts:
Loan from Mum: £3000
Argos store card: £272.84
Abbey loan: £7685.16 (Final repayment July 2013)
Abbey overdraft: £700
Tesco credit card: £1022.96 (Must be paid by Aug 2010, interest is then added!)


My monthly salary - £1,150

Monthly Outgoings:
Rent - £225
Gas - £10
Electric - £10
Food - £80
TV License - £11.93
Phone - £55 could you not swap to a cheaper tarriff??? is this landline or mobile?
Car Insurance - £33.57
Petrol - £40
Abbey Loan - £182.98
Loan from Mum - £200
Argos store card - £50
Tesco credit card - £50

Thanks
J

According to your figures you should have £201.52 left each month?? Where is this going????

If i were you i'd throw as much money as i can at the argos card and the overdraft, as they're going to be the easiest to pay off in a short space of time. Then the £50 a month that you were paying argos can get chucked at something else.

gemsy82

Facing up to it is the first step so well done!

By my sums you've got around £200 a month leftover... where does this go?? could some of this go towards overpayments on the debts?

The argos storecard will be paid off in 5 1/2 mths, then that money you currently pay each month can go towards the tesco cc. In August 2010 you should be able to transfer that debt over to another 0% interest card and continue the payments there, increasing them or making overpayments when possible.

By my reckoning without making overpayments you can be clear of the tesco cc & argos store card debt by March 2011. You've 15 payments left to your mum, which will be clear by May 2011, again without making any overpayments once other debts are cleared.

I think you could get your phone bill down with some shopping around and/or careful usage??

You don't say anything about interest on your Abbey o/d? is this interest free? Consider opening a different bank account for regular use and pay money back into the Abbey account to resist temptation of slipping further back into the o/d.

Once you have cleared the other debts, consider re-financing the Abbey loan to make higher repayments & therefore pay it off quicker?

Also, consider a 2nd job or other forms of income to save money? Could you get the bus to work & sell your car, perhaps if your fiance has a car you can share? Can you reduce the food bill at all? Already seems pretty good to me, but dropping a brand level (i.e. buying basics/ value ranges) can save a lot of money?

Hope this helps!!!!

niccatw

J - a spending diary really helps to see where your surplus is going! A bit tedious, but insightful! Even do it just for a month. And have a look through your bank statement - how many times have you taken £10 here and £20 there from the ATM?

It was going through my statements with a fine toothcombe that finally terrified me into doing a spending diary! I was easily taking out a couple of hundred a month with nothing to show for it and no idea what I was spending it on!

Tixy

Hi Jak and welcome

And well done for facing up to your debts and problems whilst still so young.

I agree with nicca that it would help if you do a full budget using the link she gave. It will allow you to budget for car tax, car servicing etc and for items such as clothes and presents that you don't buy each month. (Put 1/12 of the annual cost in)

Do you your OH keep your finances seperate? Does she pay the same towards rent & utilities & groceries etc?

Have you checked to see if you can get a cheaper phone tariff? that seems a high amount.

Can you work any overtime? any chance of a payrise soon at work? Have you considered a second job for a short period?

(PS good luck with the lottery! - but I'm planning on winning it this week so maybe buy your ticket next week!!)

niccatw

gemsy82 wrote: »

Once you have cleared the other debts, consider re-financing the Abbey loan to make higher repayments & therefore pay it off quicker?

Before you consider re-financing the loan, check whether you can make overpayments without penalties. Depending on its interest rate, it might be cheaper to overpay if that's allowed.