closing the blackhole

Treacle1983

I had a bit of a realisation on saturday that makes for scary reading -
enjoy.

I'll let you know how I get on.

Ok so the day of reckoning as it were was actually a sunny Saturday afternoon in April 2010 sat with my other half in our local pub with an alcoholic drink in hand, weekend paper and a nice meal in front of us.
A rather interesting article that brought about a few realisations and hopefully a few changes. The article was written by a 26 year old young lady, much like myself. Living with her partner in rented accomodation struggling to understand where all her money goes every month and why she can’t get credit or a foot on the property ladder.
I sat down after reading the article and thought – that’s me!
26 with a reasonably good job earning 25k a year. Still renting a poky cheap flat with nothing but a tv and some small electronic items to my name (I’ve always rented part furnished) with about 5k in debts all from when I was 18 and stupid. Unable to get any further credit.
Totally stuck in a rut – get paid – spend it all within a week – skint til payday so next few weeks spent planning what to spend my money on – get paid – spend it all again.
Although I do pay my bills and a bit of my debts each month – I struggle to see where my money goes – after sitting down and thinking I can see it’s frivilous things like dvd rentals, cinema trips, meals out, magazines, makeup and smellies. Food – most of which ends up getting thrown out.
It’s shocking – If I could reign the spending in I reckon I could be debt free and even have savings within the next year to two years.
So here’s the plan in 7 steps that could save me £233.33 a month/ £2799.96 a year.

STEP 1: OVERTIME – EXTRA £70 A MONTH/ £840 A YEAR.

I’ve got several things in mind already and some already put into action such as starting to put in some more overtime to up my wages. I reckon I could easily average an extra £70 a month in overtime after tax and ni etc..

STEP 2: OWN BRAND SHOPPING – SAVING £12.32 A MONTH/ £147.84 A YEAR.

I am also going to try buying supermarket own brands for items I normally wouldn’t.
For example: Tesco
This is a list of items I have swapped to this month:
1: Handwash for the bathroom £1.33 – Own brand is 38p saving of 95p.
2: Cereal Bars £1.57 – Own brand is 74p saving of 83p
3: Toilet Cleaner £1 – Own brand is 24p saving of 76p
4: Yogurts x 4 £1.29 – Own brand is 20p saving of £1.09
5: Tinned Sweetcorn 66p – Own brand is 33p saving of 33p
6: Mouthwash £2.50 – Own brand is 45p saving of £2.05
7: Teabags 160’s £3.89 – Own brand is £2.50 saving of £1.39
8: Toilet Rolls x 9 £4.49 – Own brand is £1.99 (there is cheaper still available) saving of £2.50
9: Orange Squash £1 - Own brand is 48p saving of 52p
10: Shampoo and Conditioner £2.50 – Own brand is 60p saving of £1.90
So that is just 10 normal products I would be buying this month for £20.23 instead swapping to own brands which will cost £7.91. That’s a saving of £12.32 this month just buy buying own brands.
If I managed just that every month that would be £147.84 saved in a year!! Oh my god!!!
I reckon I could swap at least 10 of my other regular buys like Toothpaste, Eggs, Bread, Ready Meals, Sausages etc.. So I could actually be looking at nearly £300 a year saved just by doing this.

STEP 3: DITCH THE TAKEAWAYS – SAVING £25 A MONTH/ £300 A YEAR

I reckon I spend at least £30 a month on pizza, chinese, subway etc.. I can easily and realistically cut this back to just a £5 spend a month.

STEP 4: PACKED LUNCHES – SAVING £60 A MONTH/ £720 A YEAR

I am terrible for popping to the sandwich bar or boots for lunch and can easily spend £4 a day on food and drink for at work. That’s an awful lot and I could easily pack myself a lunch every day – it would be easier to keep an eye on the calories too. I reckon packed lunches could be done for £1 a day.

STEP 5: WASTE LESS – SAVING £20 A MONTH/ £240 A YEAR

I probably throw away at least £5 worth of food a week from either not storing it in the fridge properly, buying too much at once or by letting it go out of date whilst I end up doing the easy option and getting takeaway.
There is no excuse for this and it has to stop.

STEP 6: USE LESS GAS/ELECTRIC/WASHING MONEY – SAVING £20 A MONTH/ £240 A YEAR

We use a shared washing machine and tumble dryer which costs about £2 to wash and dry a load of washing. We probably do at least 3 loads a week. That’s £6. By drying the clothes on airers or outside I could half this.
I also nearly always have the heating on when I am at home and it costs a fortune. I think I will start wearing a jumper and snuggling under my blanket more. That should save at least £5 a month.
I also tend to have baths rather than showers and leave the tap running when I wash hands and brush teeth etc.. I reckon I could save a bit more money here too say £3 a month.

STEP 7: MOVIE RENTALS/MAGAZINES – SAVING £26.01 A MONTH/ £312.12 A YEAR

I rent from blockbuster and spend at least £10 a month on dvd’s. I also read a lot of womens magazines and spend about £5 a week on them. I am going to stop buying magazines and start reading them online if I need to and also join back up to lovefilm which for a basic package is £3.99 a month.
So that’s my 7 steps and who know’s maybe I can even add more to this – for now I’m just going to stick to this and get used to it and plan on what to spend that £2799.96 a year on. Only kidding – debts and savings!!

Thanks for reading,

Trinny

Hi there

Why dont you post a statement of affairs - its a list of all that you earn and all that you pay.

People will be able to help you to make your money go further.

Its not too late to change things, you may feel that your 7 steps are enough to sort things out, and you may be right, but in most cases, posting your income and payments, will help the real experts on here to help you.

Best Wishes

Trin

Tixy

Thats some list treacle - it really makes you think doesn't it.

You know I think I might have a go at a similar list for myself, although I don't do somethings you have listed I should be able to come up with a list of at least 5 things (it might be sticking to them that I'll struggle on!)

Treacle1983

statement of income/expenditure as requested. it's not that i'm in the red or anything - I mean my debts are getting paid and I do have a bit of money left each month - but my sick pay at work has just been stopped due to having a lot of time off sick - I'm not entitled to any disability money or anything i've checked - so i need to 1: try and cut back a bit so i can clear some of my smaller debts and 2: try to build up some saving so that if i'm off sick again I can afford to keep myself afloat as it were.

The 7 steps in posting 1 are my ideas so far to try and cut back - hopefully as painlessly as possible to try and manage this.

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household.........
Number of cars owned....................
Monthly Income Details
Monthly income after tax................ 1200
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1200
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 250
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 40
Gas..................................... 50
Oil..................................... 0
Water rates............................. 45
Telephone (land line)................... 0
Mobile phone............................ 20
TV Licence.............................. 22
Satellite/Cable TV...................... 0
Internet Services....................... 15
Groceries etc. ......................... 150
Clothing................................ 30
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 25
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 15
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 5
Life assurance ......................... 0
Other insurance......................... 12
Presents (birthday, christmas etc)...... 5
Haircuts................................ 4.5
Entertainment........................... 25
Holiday................................. 0
Emergency fund.......................... 25
Total monthly expenses.................. 738.5

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

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
natwest........................180.......10........0
blackhorse.....................2578......70........0
studio.........................150.......5.........0
water bill debt................200.......25........0
money owed to partner..........1500......150.......0
Total unsecured debts..........4608......260.......-

Monthly Budget Summary
Total monthly income.................... 1,200
Expenses (including HP & secured debts). 738.5
Available for debt repayments........... 461.5
Monthly UNsecured debt repayments....... 260
Amount left after debt repayments....... 201.5
Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -4,608
Net Assets.............................. -4,608
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.

Tixy

Treacle - the only thing that jumps out at me is your water bill - is that metered or unmeasured? If you are on a meter I think around £12-£15 per adult is average usage (depending on the area you live) so if you are metered check you don't have a leak, if not then look to see if you would make a saving by switching to one.

charlyze2

Hi there. Im no expert but your gas and electric look high to me

I spend 60 on leccy and 35 on gas but there are two adults and two kids in a3 bed house.

If you house share is that you paying half?? that would make them at 80 leccy and 100 gas. seems really high

Charlie

DVardysShadow

You have £200/month surplus after repayments. This could go to the Natwest loan, Studio and Water over 3 months, leaving you with £240/month and able to pay off your partner at £400/month - clearing that debt after about 6 or 7 months. Of course the reality is that you probably don't have that surplus because you have money leaks ...

Your post lists some issues which could include your money leaks, but you could try a spending diary and find out exactly what is going on

Ex-Spendaholic

Just wanted to say thats a great list you have there. Good luck with it. :beer:

RobertoMoir

Treacle1983 wrote: »

STEP 2: OWN BRAND SHOPPING – SAVING £12.32 A MONTH/ £147.84 A YEAR.

I am also going to try buying supermarket own brands for items I normally wouldn’t.
For example: Tesco
This is a list of items I have swapped to this month:
1: Handwash for the bathroom £1.33 – Own brand is 38p saving of 95p.
2: Cereal Bars £1.57 – Own brand is 74p saving of 83p
3: Toilet Cleaner £1 – Own brand is 24p saving of 76p
4: Yogurts x 4 £1.29 – Own brand is 20p saving of £1.09
5: Tinned Sweetcorn 66p – Own brand is 33p saving of 33p
6: Mouthwash £2.50 – Own brand is 45p saving of £2.05
7: Teabags 160’s £3.89 – Own brand is £2.50 saving of £1.39
8: Toilet Rolls x 9 £4.49 – Own brand is £1.99 (there is cheaper still available) saving of £2.50
9: Orange Squash £1 - Own brand is 48p saving of 52p
10: Shampoo and Conditioner £2.50 – Own brand is 60p saving of £1.90
So that is just 10 normal products I would be buying this month for £20.23 instead swapping to own brands which will cost £7.91. That’s a saving of £12.32 this month just buy buying own brands.
If I managed just that every month that would be £147.84 saved in a year!! Oh my god!!!
I reckon I could swap at least 10 of my other regular buys like Toothpaste, Eggs, Bread, Ready Meals, Sausages etc.. So I could actually be looking at nearly £300 a year saved just by doing this.

STEP 3: DITCH THE TAKEAWAYS – SAVING £25 A MONTH/ £300 A YEAR

I reckon I spend at least £30 a month on pizza, chinese, subway etc.. I can easily and realistically cut this back to just a £5 spend a month.

Great list. I think anyone who hasn't already done so could always stand to think about those areas themselves.

Couple of things do spring to mind...
I've tried the "dropping a brand" idea in the supermarket and it does work but you may find you have to experiment a bit. It may be that the cheap supermarket brand of, for example, your mouthwash just doesn't taste "right" or that you simply dislike the yoghurts. Be prepared to experiment and try a few of the other "cheaper" brands if you don't like the first one you try rather than give up. Interesting thing - I found i prefer sainsbury's "basic" choc-ices to the more expensive ones.

As for the takeaways - if you like chinese food, there's a good thread on (I think) the old style moneysavers board that has all kind of simple recipes for "takeaway style" chinese dishes and the like. I bet you'd be surprised how easy it is to put some of the dishes together, I know I was.

Edit: Found the thread for you. If that doesn't get the tastebuds jumping...

Judith_W

I notice you shop at Tesco and use Blockbusters. Not sure if it has been mentioned as didn't read all the replies but you can use £12 of tesco clubcard vouchers for 12 blockbuster rentals. It includes box sets too so really good value.

The vouchers last for 6mths so this is a really affordable way to do something you enjoy cheaply.

gonzo127

Treacle1983 wrote: »

statement of income/expenditure as requested. it's not that i'm in the red or anything - I mean my debts are getting paid and I do have a bit of money left each month - but my sick pay at work has just been stopped due to having a lot of time off sick - I'm not entitled to any disability money or anything i've checked - so i need to 1: try and cut back a bit so i can clear some of my smaller debts and 2: try to build up some saving so that if i'm off sick again I can afford to keep myself afloat as it were.

The 7 steps in posting 1 are my ideas so far to try and cut back - hopefully as painlessly as possible to try and manage this.

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household.........
Number of cars owned....................
Monthly Income Details
Monthly income after tax................ 1200
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1200
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 250
Management charge (leasehold property).. 0
Council tax............................. 0 - no council tax?
Electricity............................. 40
Gas..................................... 50 - as you have pointed out your gas and electric are SHOCKING phone your utility supplier and get your annual use in KWH then go to a price comparison site and pop in your details to find if you are on the best tarrif if not clear the cookies on your computer and then swop through a cashback site like quidco, current cashback ranges from £40 to £130 i would expect a house of 2 to be spending about half of what you are currently spending (my house with me the wife 2 teenagers and a baby only spend £101 a month on gas and elec)
Oil..................................... 0
Water rates............................. 45 - this is high are you on a water meter?
Telephone (land line)................... 0 - no landline but have internet services?
Mobile phone............................ 20 - do you use all your mins and texts? if not phone the company and ask to be dropped to a cheaper more suitable tarrif, the worst they can say is no!
TV Licence.............................. 22- i believe this should be about £12 not 22
Satellite/Cable TV...................... 0
Internet Services....................... 15
Groceries etc. ......................... 150 - not bad could do a bit better with meal planning so you ONLY buy what foo dyou need for those meals, batch cooking and freezing any left overs for instant ready meals and the drop a brand chalange (you have already started looking into this which is great)
Clothing................................ 30 - quite a bit do you really need £360 a clothes every year? look at where you shop for clothes, tesco asda and matalan do some good stuff and charity shops do have some good stuff as well
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 25
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 15
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 5
Life assurance ......................... 0
Other insurance......................... 12
Presents (birthday, christmas etc)...... 5
Haircuts................................ 4.5
Entertainment........................... 25
Holiday................................. 0
Emergency fund.......................... 25
Total monthly expenses.................. 738.5

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

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
natwest........................180.......10........0
blackhorse.....................2578......70........0
studio.........................150.......5.........0
water bill debt................200.......25........0
money owed to partner..........1500......150.......0 - APRs would be very helpful to work out which debts need to be paid back quickest
Total unsecured debts..........4608......260.......-

Monthly Budget Summary
Total monthly income.................... 1,200
Expenses (including HP & secured debts). 738.5
Available for debt repayments........... 461.5
Monthly UNsecured debt repayments....... 260
Amount left after debt repayments....... 201.5 = great surplus however do you have this left at the end of the month? if not you need to start a spending diary to track every penny
Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -4,608
Net Assets.............................. -4,608
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.

hi i have made a few comments above, i am guessing this is your 'new' SOA with your extra enpenditure already taken out so as it is you are looking to be in a good situation, there are a few extra places you could make a saving