My 'SOA' advice please!

everclear1973_2

Hi,it was suggested i post a soa to get some advice on what to do with our debt problems ,so here it is-


Monthly incomings

My salary-£1450
Wife's-£940
No other income.

Total-£2400

Monthly outgoings

Mortgage £300 (On a half share of housing scheme)
Rent £128 (paid to the housing scheme)
Council tax-£120
Electric-£60
Tv license-£10
Sky-£38 (going to downgrade to £18 though)
Water/sewage-£30
Phone-£34
Food-£250
Car insurance-£34
Petrol-£40-50
Broadband-£20
Mobile phone-£50 (going to go pay as you go)
Pet insurance-£18
Life insurance-£20
Contents-£20

Total-£1172

Moneyback bank loan £20,000 7 years,6 left 6% apr £350 a month
Black horse loan-balance at £6034 43 months left 11.9% apr £189 a month
Egg loan-£9000 7 years,5 left 9% apr £190 a month
Egg card-£4500 limit-at max 15.9% apr £94 a month
Egg card-£750 limit-at max 15.9% apr £17 a month
Lloyds card-£8500 limit-£4800 balance 14.9% apr £100 a month
Capital one-£2000 limit-at max 15.9% apr £100 a month
Capital one-£2500 limit-at max 15.9% apr £65 a month
Mbna card-£1000 limit-£950 balance 16.9% apr £25 a month
Mbna card-£3500 limit-£1000 balance 16.9% apr £20 a month
Overdraft(lloyds) £5000 limit-£4500 used unsure
Abbey overdraft £1000 limit-slightly over due to dd charges! unsure
Evans store card-limit £1600-balance £1402 20% apr £56 a month

£1206 paid a month on cards and loans!

That's it! Not good is it! Haven't been living a luxury life much either,we had big loans before moving into our first home,and i guess it's just escalated from there. :eek:

Been looking on here,seen stuff about iva's dmp's,confused now,and really want to stop this and eventually not bother with loans or cards ever again!

Advice badly needed,thanks in advance!

crazyscientist

Hi everclear
I'm not an expert at this but i'll give you my thoughts...


QUOTE=everclear1973]Hi,it was suggested i post a soa to get some advice on what to do with our debt problems ,so here it is-


Monthly incomings

My salary-£1450
Wife's-£940
No other income. - any possibility of a parttime job? sell things on Ebay etc??

Total-£2400

Monthly outgoings

Mortgage £300 (On a half share of housing scheme)
Rent £128 (paid to the housing scheme)
Council tax-£120
Electric-£60
Tv license-£10
Sky-£38 (going to downgrade to £18 though) this is still a LOT of money. why not get freeview?
Water/sewage-£30
Phone-£34 is this landline? seems high esp when you have big mobile bill too
Food-£250 how many in your family? check out the old style boards for much cheaper meal ideas
Car insurance-£34
Petrol-£40-50
Broadband-£20
Mobile phone-£50 (going to go pay as you go) or maybe a new contract with 12 months free line rental? that way you get completely free phone, line rental, calls and texts for the year. see mobile phones board for plenty offers like this
Pet insurance-£18 cancel this. if you really worry about vets bills put a small amount into a savings account every month instead
Life insurance-£20 i assume this is essential for your mortgage? but might be worth checking around for cheaper
Contents-£20

Total-£1172

Moneyback bank loan £20,000 7 years,6 left 6% apr £350 a month
Black horse loan-balance at £6034 43 months left 11.9% apr £189 a month
Egg loan-£9000 7 years,5 left 9% apr £190 a month
Egg card-£4500 limit-at max 15.9% apr £94 a month
Egg card-£750 limit-at max 15.9% apr £17 a month
Lloyds card-£8500 limit-£4800 balance 14.9% apr £100 a month
Capital one-£2000 limit-at max 15.9% apr £100 a month
Capital one-£2500 limit-at max 15.9% apr £65 a month
Mbna card-£1000 limit-£950 balance 16.9% apr £25 a month
Mbna card-£3500 limit-£1000 balance 16.9% apr £20 a month
Overdraft(lloyds) £5000 limit-£4500 used unsure
Abbey overdraft £1000 limit-slightly over due to dd charges! unsure
Evans store card-limit £1600-balance £1402 20% apr £56 a month

£1206 paid a month on cards and loans! you need to focus on paying the highest interest rate debts first. have a look on the 'snowballing' threads for the advantages this has

That's it! Not good is it! Haven't been living a luxury life much either,we had big loans before moving into our first home,and i guess it's just escalated from there. :eek:

Been looking on here,seen stuff about iva's dmp's,confused now,and really want to stop this and eventually not bother with loans or cards ever again!

Advice badly needed,thanks in advance![/QUOTE]

Lucie_2

everclear1973 wrote:

Monthly incomings

My salary-£1450
Wife's-£940
No other income.

Total-£2400

It's actually £2390. Not normally one to split hairs over a tenner; but this may be where you're going wrong. Under-estimating everything you spend is how a lot of people get into debt. You need to start monitoring a lot closer everything you spend. eg is your food bill really £250 or is that just an estimate? Have you forgotten about the odd takeaway or pub lunch?

Please don't think I'm being critical, but the people on here who are becoming successful DFWs know their financial details inside out. They check their bank account online daily, keep a spending diary of EVERY penny & know their budget for food, clothes & petrol. It's all about you being in control of your money, rather than it being in control of you.
Good luck with it all.

sparklymessygirl

Hi Everclear,

Whilst you are waiting for the real experts to pile on in I thought I would flag a couple of points..
Pet insurance - how many animals? I recently switched my two dogs to M&S and save about £10 per month now for better cover (only downside of course is that with changing you are losing protection that you might have had for previously existing conditions).

High interest rates on credit cards - the balances don't look so big so maybe you could transfer some to lower life of balance interest rates?

Good luck
Sparkly

Wizwoo

Hi everclear1973,

Welcome to the DFW board and well done for posting your SOA :T . That first step can be really tough - you've finally put those debts together.

Why not approach all those that you both have credit cards with and ask them to reduce the apr - this will help free up the cash to pay off the store card.

I'll let others more wise than me take it line by line. The main thing I would say as did crazyscientist - focus on the high interest borrowing and throw all you can at clearing those first.

It really looks like you both need to focus on getting more income in too - a couple of evenings a week / Saturday job?

Keeping a money diary can really help focus the mind and make you watch every penny.

Good luck everclear - and keep talking.

Ww

black-saturn

I agree with all the above but also your water bill is high. Is that on a meter?

Also your car expenses are high. Is there no way you can give up the car? I did it and you will be surprised at how you soon adapt to not having one and wonder why you ever thought you needed one in the first place.

jessicamb

Looks like you have been living on credit for a long time!

Ok what can be saved on:
Sky as above, get freeview = £38
Broadband, cheapest packages are around £15 maybe less = £5
Food - how many are you feeding. If its two I reckon you could halve this over time with meal planning/clever budgeting. = £125

Mobile Phone - ?
Home Phone - ?
Life Insurance - ?
Pet Insurance - ? (the usefulness of the is debatable. Personally I would keep it depending on what pets you've got but I think a dog is more likely to need treatment than you are to be burgled)

With a few changes you are likely to have £150+ per month to throw at debts.

As you save some money throw that saving at your debts - even £10 a month will make a difference. Use snowballing techniques to pay off the highest interest debt first.

Looking at the loans above - have you previously tried consolidating them into a larger loan? As you pay off a card close the account then you dont increase the debt again.

Iriahm

hi, i insure my cats with sainsburys that way I get nectar points too! each cat costs £3.50. there are a lot of differences with pet insurance but they seem to have a pretty comprehensive insurance policy. its not a huge saving but they all mount up! last year one got vvvv sick and i'd only been paying for 3 months. they ended up paying back over £2k of bills so i'm a BIG fan of insurance!

good luck!

everclear1973_2

Yes i had used big loans to clear cards then used cards again,and again! I don't really feel i can clear the cards at the moment,i'm near to going over big overdraft and really need a big hitting solution,dmp's or iva's? I need to do something,i'm 33 and daren't have children yet with wife,because of the extra money involved.......

WelshWoofer

Most of your utility bills seem high to me - electric, phone, water, Sky, broadband etc.
Coudl you switch to a water meter - it saved me tons and I ony pay 16 quid a month for water. Also try looking at deals that encompass TV, phone and braodband in one package - could cut back on quite a bit.
I started a spending diary and was amazed- I thought I was quite careful until I saw it in black and white!

Good luck!
R

WelshWoofer

By the way , my dog insurance (all inclusive - pedigree) is only 8 quid a month with Lloyds TSB