How can I keep the wolves from the door?

got_no_dosh

Hello, I am at the end of my tether now with finances. Every day I have final demands through the door, threats of bailliffs, banks and credit card companies ringing up every 5 minutes. It has got so stressful that I've stopped answering the phone and opening the letters. I've got a constant headache worrying about whether we are going to loose our home, and keep having panic attacks. I don't know anyone that can help me, and my mind just goes blank when I do make an effort - I can't seem to work out what to do to stop it getting worse. Unfortunately my other half (DH? sorry I don't know the lingo) just gets angry and demands I sort it out.

I do my best to be economical and do live frugally so I can't understand why we are always having direct debits returned etc because there is not enough money in the account. I get really upset at the injustice when I look at how much the banks and cc companies are charging us. From the SOA I filled in it looks like we ought to manage but every month something unexpected comes up to to pay for. This month my car is due an MOT which it is unlikely to pass and will not be worth the price of repairs.


Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 3
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 600
Partners monthly income after tax....... 1800
Benefits................................ 186
Other income............................ 0
Total monthly income.................... 2586

Monthly Expense Details
Mortgage................................ 600
Secured/HP loan repayments.............. 90
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 196
Electricity............................. 60
Gas..................................... 200
Oil..................................... 0
Water rates............................. 40
Telephone (land line)................... 20
Mobile phone............................ 25
TV Licence.............................. 12
Satellite/Cable TV...................... 20
Internet Services....................... 0
Groceries etc. ......................... 250
Clothing................................ 50
Petrol/diesel........................... 200
Road tax................................ 0
Car Insurance........................... 80
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 40
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 25
Contents insurance...................... 15
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 100
Haircuts................................ 0
Entertainment........................... 50
Holiday................................. 150
Emergency fund.......................... 0
Total monthly expenses.................. 2223


Assets
Cash.................................... 0
House value (Gross)..................... 130000
Shares and bonds........................ 0
Car(s).................................. 2000
Other assets............................ 15000
Total Assets............................ 147000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 110000...(600)......6
Hire Purchase (HP) debt ...... 2000.....(90).......0
Total secured & HP debts...... 112000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
credit card....................4000......200.......0
credit card....................2000......100.......0
credit card....................600.......30........0
Total unsecured debts..........6600......330.......-


Monthly Budget Summary
Total monthly income.................... 2,586
Expenses (including HP & secured debts). 2,223
Available for debt repayments........... 363
Monthly UNsecured debt repayments....... 330
Amount left after debt repayments....... 33

Personal Balance Sheet Summary
Total assets (things you own)........... 147,000
Total HP & Secured debt................. -112,000
Total Unsecured debt.................... -6,600
Net Assets.............................. 28,400


Where is the best place to get practical help from someone who can help me do what I need to do to stop the situation getting any worse???

HELP!

DVardysShadow

got_no_dosh wrote: »

Where is the best place to get practical help from someone who can help me do what I need to do to stop the situation getting any worse???

HELP!

You are fortunate. Cut down your spending. £200 on gas is excessive. So is £100 on gifts. Your petrol looks high too. And you could cut the TV.

How much longer does your HP run for?

got_no_dosh

DVardysShadow - Yes, I know it seems like we should be very comfortable - that is why I cannot understand why I am often emptying out my kids moneybox of 2p's to buy bread! The £200 gas is because we are on a catch -up from being on the wrong tarriff for a long time. We don't spend £100 on gifts every single month, that was just adding up every expense I could think of re birthdays and christmas (Christmas is generally expensive with 3 kids) throughout the year - I could cut back there.
Is that really too much petrol for 2 cars? I might have overestimated then.
I think the HP has about 18 months left.
Surely I can keep the TV?
A big problem is that we are getting charged loads of interest and fees from being behind with debt payments which means we don't have enough to meet our DDs.

Tixy

Hi and welcome

Bearing in mind what you have written regarding final demands etc I'll make some suggestions on you cutting right down to bare essentials for now to try and improve your situation.

Why does your other-half tell you to sort it out? do you deal with finances together or have you always dealt with them. You do need to be a team to tackle debt problems successfully.

got_no_dosh wrote: »

Hello, I am at the end of my tether now with finances. Every day I have final demands through the door, threats of bailliffs, banks and credit card companies ringing up every 5 minutes. It has got so stressful that I've stopped answering the phone and opening the letters. I've got a constant headache worrying about whether we are going to loose our home, and keep having panic attacks. I don't know anyone that can help me, and my mind just goes blank when I do make an effort - I can't seem to work out what to do to stop it getting worse. Unfortunately my other half (DH? sorry I don't know the lingo) just gets angry and demands I sort it out.

I do my best to be economical and do live frugally so I can't understand why we are always having direct debits returned etc because there is not enough money in the account. I get really upset at the injustice when I look at how much the banks and cc companies are charging us. From the SOA I filled in it looks like we ought to manage but every month something unexpected comes up to to pay for. This month my car is due an MOT which it is unlikely to pass and will not be worth the price of repairs.


Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 3 how old are the kids?
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 600 any chance to increase your hours?
Partners monthly income after tax....... 1800
Benefits................................ 186 are you getting all your can (check out www.entitledto.co.uk
)
Other income............................ 0
Total monthly income.................... 2586

Monthly Expense Details
Mortgage................................ 600 is this interest only or repayment?
Secured/HP loan repayments.............. 90
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 196 this looks really high, have you done the 5min check to ensure you are in the correct band? is this all current year or are you paying arrears as well?
Electricity............................. 60
Gas..................................... 200 this is horrific, guessing its arrears, how much of the payment is arrears and how much is current usage? how long until arrears are paid?
Oil..................................... 0
Water rates............................. 40
Telephone (land line)................... 20
Mobile phone............................ 25
TV Licence.............................. 12
Satellite/Cable TV...................... 20 consider cancelling. Or phone up and threaten to cancel and see if they do a half price deal.
Internet Services....................... 0
Groceries etc. ......................... 250 not bad, maybe able to reduce a little with careful meal planning etc (although depends on age of kids)
Clothing................................ 50 cut this to minimum, nothing for adults for now and only essentials for kids
Petrol/diesel........................... 200 is this mostly commuting? do you drive efficently (slowly)
Road tax................................ 0 need to budget for this each month, thats why you keep having problems
Car Insurance........................... 80 have you checked these are the cheapest? shopped around and looked at earning cashback? do either of you have points? are they high insurance cars?
Car maintenance (including MOT)......... 0 need to budget 1/12 each month
Car parking............................. 0
Other travel............................ 40 what is this for?
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 25
Contents insurance...................... 15 B&C wuite high compared to house value, shop around to see if you can save
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 100 way too high if you have final demands, cut right back and buy for less people
Haircuts................................ 0
Entertainment........................... 50
Holiday................................. 150 cannot afford £1.8k on a holiday if you have arrears
Emergency fund.......................... 0
Total monthly expenses.................. 2223


Assets
Cash.................................... 0
House value (Gross)..................... 130000
Shares and bonds........................ 0
Car(s).................................. 2000
Other assets............................ 15000 what are these? can you sell them?
Total Assets............................ 147000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 110000...(600)......6
Hire Purchase (HP) debt ...... 2000.....(90).......0 is this one of the cars?
Total secured & HP debts...... 112000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
credit card....................4000......200.......0 need to find out APRs
credit card....................2000......100.......0
credit card....................600.......30........0
do you have an overdraft? include it here if you do
Total unsecured debts..........6600......330.......-


Monthly Budget Summary
Total monthly income.................... 2,586
Expenses (including HP & secured debts). 2,223
Available for debt repayments........... 363
Monthly UNsecured debt repayments....... 330
Amount left after debt repayments....... 33

Personal Balance Sheet Summary
Total assets (things you own)........... 147,000
Total HP & Secured debt................. -112,000
Total Unsecured debt.................... -6,600
Net Assets.............................. 28,400


Where is the best place to get practical help from someone who can help me do what I need to do to stop the situation getting any worse???

HELP!

Do you owe any money to utlity cos, council tax etc. If so include these in your list of debts. Have you been making the minimum payments to all cards?
Which dds have been bouncing? you need to pay prorioty debts such as mortgage, ctax, gas, elec and water before you pay anything to your unsecured cards.

I think you need cut all luxuries out for now and contact one of the debt charities https://forums.moneysavingexpert.com/discussion/2077631. Whilst it shows you have a surplus this is because you are not budgeting properly for the annual items.

Ignoring your debts is never the solution, you need to tackle things now or they will get much worse.

property.advert

got_no_dosh wrote: »

Hello, I am at the end of my tether now with finances. Every day I have final demands through the door, threats of bailliffs, banks and credit card companies ringing up every 5 minutes. It has got so stressful that I've stopped answering the phone and opening the letters. I've got a constant headache worrying about whether we are going to loose our home, and keep having panic attacks. I don't know anyone that can help me, and my mind just goes blank when I do make an effort - I can't seem to work out what to do to stop it getting worse. Unfortunately my other half (DH? sorry I don't know the lingo) just gets angry and demands I sort it out.

I do my best to be economical and do live frugally so I can't understand why we are always having direct debits returned etc because there is not enough money in the account. I get really upset at the injustice when I look at how much the banks and cc companies are charging us. From the SOA I filled in it looks like we ought to manage but every month something unexpected comes up to to pay for. This month my car is due an MOT which it is unlikely to pass and will not be worth the price of repairs.


Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 3
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 600 £110k at 6% interest only is £550 and repayment is over £700 at least so check this figure as I don't see how it can be £600 on £110k at 6%.
Partners monthly income after tax....... 1800 is this right or a guestimate ? round figures make me think an estimate
Benefits................................ 186
Other income............................ 0
Total monthly income.................... 2586

Monthly Expense Details
Mortgage................................ 600
Secured/HP loan repayments.............. 90
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 196
Electricity............................. 60 this seems very high when your heating is on gas. I pay £60 for electric including heating
Gas..................................... 200 seems incredibly high go to uswitch and check your actual usage, not what you spend
Oil..................................... 0
Water rates............................. 40
Telephone (land line)................... 20
Mobile phone............................ 25 clutching at straws but perhaps you can reduce it ?
TV Licence.............................. 12
Satellite/Cable TV...................... 20
Internet Services....................... 0
Groceries etc. ......................... 250 I know there are 5 of you and you work but buying in bulk and freezing, especially on meat can cut the unit cost about in half - I do.
Clothing................................ 50 very reasonable but is it realistic ?
Petrol/diesel........................... 200 hard to judge but are there journeys you could cut or car share ?
Road tax................................ 0
Car Insurance........................... 80 is this 2 cars ? Very high if only one. My insurance with zero no claims is only £500
Car maintenance (including MOT)......... 0 you will have bills here for sure
Car parking............................. 0
Other travel............................ 40
Childcare/nursery....................... 0
Other child related expenses............ 0 3 kids and no pocket money ?
Medical (prescriptions, dentist etc).... 0 5 people need to go to the dentist, teeth cleaning, preventative etc.
Pet insurance/vet bills................. 0
Buildings insurance..................... 25 check online for cashbacks at renewal
Contents insurance...................... 15 check online for cashbacks at renewal
Life assurance ......................... 0 you should have some provision here. A 40 year old male can get £400k over 30 years for around £35 a month
Other insurance......................... 0
Presents (birthday, christmas etc)...... 100 hard to cut I know but there is scope here
Haircuts................................ 0
Entertainment........................... 50
Holiday................................. 150 again hard but trimming the fat for this year
Emergency fund.......................... 0 something needs to be here
Total monthly expenses.................. 2223


Assets
Cash.................................... 0
House value (Gross)..................... 130000
Shares and bonds........................ 0
Car(s).................................. 2000
Other assets............................ 15000
Total Assets............................ 147000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 110000...(600)......6
Hire Purchase (HP) debt ...... 2000.....(90).......0
Total secured & HP debts...... 112000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
credit card....................4000......200.......0
credit card....................2000......100.......0
credit card....................600.......30........0
Total unsecured debts..........6600......330.......-


Monthly Budget Summary
Total monthly income.................... 2,586
Expenses (including HP & secured debts). 2,223
Available for debt repayments........... 363
Monthly UNsecured debt repayments....... 330
Amount left after debt repayments....... 33

Personal Balance Sheet Summary
Total assets (things you own)........... 147,000
Total HP & Secured debt................. -112,000
Total Unsecured debt.................... -6,600
Net Assets.............................. 28,400


Where is the best place to get practical help from someone who can help me do what I need to do to stop the situation getting any worse???

HELP!

First, you will be losing money on direct debits returned and other bank charges. Tackle this first and call and write to the credit card companies asking for some breathing space as you are having difficulties. Don't be fobbed off by their crap. Stop the direct debits if you have to and that will stop the bank charges. Perhaps open a basic account at another bank, Nationwide do not credit score you for their basic flex account if you open it by post. Very important by post. If you do it in branch they do credit check you. Get the form, fill it in and send it off. Then get your salaries paid into this new account to get a clean break - if your current bank is overdrawn and giving you hassle.

Do the above and you regain some control. Move direct debits for mortgage, water, council tax, gas, tv, telephone etc. into the new account but no loans or credit cards. They can stew for a while. Make sure their direct debits are cancelled at your bank, not asking them to cancel them ! Do write and offer repayments of say £1 a month for 3 months to see where you stand. They will shout and bluster but they know there is little they can do in such a short time if they do not try and help. Ask for interest to be frozen. Don't be frightened to rob some cash advance or some last grocery shopping before putting them on hold as it is going to be a long while before you get to use them again and a few hundred extra will make no difference to the debt but a lot of difference to get the car through the MOT.

Some will disagree with me but you have to be practical first and sod the banks later.

If you do not stop the haemorrhaging due to bank charges you can never regain control.

Best of luck and welcome !

DarkConvict

Whilst you have debts you are incurring interest especially on unsecured credit. Unless you have booked the holiday you should drop it down to 0.

Along with cutting down your entertainment, been more energy efficient ele/gas/petrol.

Groceries bill for 5 people is about right.

The presents budget is to high, yes you have 3 kids but you are in debt buying them presents on credit isn't going to help you.

Once you have trimmed down your expenses drop it all into a snowballing calculator - http://www.whatsthecost.com/snowball.aspx
Say £6600, paying £500 a month towards them at 10% interest.
It will take you 14 months to pay off these debts if you snowball correctly. During that time, you'll pay £358.00 in interest.

See your debts are costing you 2 months of holiday money just by been in debt!

paulwf

Do you actually need 2 cars?

got_no_dosh

Oh wow! Thank you so much Tixy, property.advert and DarkConvict... You give great advice! I see that my SOA wasn't all that accurate, just did it off the top of my head - eg I don't know what % rate any of our debts are at including the mortgage.
For some reason the solution sounds obvious and straight forward when someone else thinks of it...
I will try to post a more accurate picture of the situation....

got_no_dosh

paulwf - we have always had 2 cars but it looks like I will have get used to public transport soon. It will be a giant pain in the neck (getting kids to school etc) and I suspect cost about the same as running a car, but I obviously can't afford to replace the banger even with another banger!

DarkConvict

You need to sit down and talk to your partner, work out an accurate SOA and see where you are willing to make cuts.
Short term cuts in SOA make long term gains for further spending.

Pure example

£10000 @ 15%, repaying £500 a month
It will take you 23 months to pay off these debts if you snowball correctly. During that time, you'll pay £1,417.00 in interest.

£10000 @ 15%, repaying £600 a month
It will take you 19 months to pay off these debts if you snowball correctly. During that time, you'll pay £1,130.00 in interest.

£10000 @ 15%, repaying £700 a month
It will take you 16 months to pay off these debts if you snowball correctly. During that time, you'll pay £935.00 in interest.

£10000 @ 15%, repaying £800 a month
It will take you 14 months to pay off these debts if you snowball correctly. During that time, you'll pay £797.00 in interest.

£10000 @ 15%, repaying £900 a month
It will take you 12 months to pay off these debts if you snowball correctly. During that time, you'll pay £692.00 in interest.

£10000 @ 15%, repaying £1000 a month
It will take you 11 months to pay off these debts if you snowball correctly. During that time, you'll pay £612.00 in interest.

DVardysShadow

got_no_dosh wrote: »

...
I think the HP has about 18 months left.
Surely I can keep the TV?

OK, some relief in 18 months when the HP stops. You'll ave to restrain yourself from replacing the car.

As for the TV, if you love it that much then you'll have to learn to live with your debt that much longer. It might be harsh, but it's not me being harsh, it's the arithmetic.