SOA - Please Advise

HappyMJ

Hannah_10 wrote: »

If the credit cards continue to pick up by £75 a month (for the sake of a round number) then the debt will grow, debts don't grow indefinately, there will come a point no one will lend, what then? They'll still have to cut back to get thier spending within means only now they'll have to do it with a bigger debt burden and tarting for a new 0% rate will be out.

I couldn't agree more that a DMP is an option she shouldn't have to take, it's no easy ride setting one up and that is what I've attempted to highlight. Right now though living as she is doing, only a DMP or going deeper into debt appear possible.

We also both agree that the ideal resolution would be cutting back/upping income then snowballing her way out of debt; but to do this means she's will to have to change some of those items on the SOA she previously argued weren't changeable. If it's done on the income side, the expenditure side or both is immaterial; the important bit is the result- she needs to find a bare minimum of another £73.64 somehow and ideally a bit more too. I suggest £100 to £200 would not just service the debt but begin to reduce it.

Also your giving tips on reducing spend or upping income would again suggest to me you and I are very much on the same page with this. If you look at what you and I are writing it's really only the style that varies and not the substance, we're agreeing on all the key points.

Yep...that's the tricky thing about SOA's they are in fact paying them off at a rate of £367 per month but incurring £216 in interest charges (assuming 13.9% across the board) as well as the £75 shortfall being charged back they are actually still paying them off each month at a rate of £76 per month. Granted (£292 per month) it'll take a bit less than 10 years to get them paid off. (according to my snowball calculator)

laisbojar83

Hi Lita

I wish you all the best of luck on your journey towards the most desired debt free days.
I am only a newbie here but I have checked your SOA and like Hannah said we do have to make life style changes to keep us going.
Try sitting down with your OH, show him the reality as it is and explain about DCAs and all the hassle that comes with it.
I see a lot of potential on your SOA for savings that could be used to keep you going.
For instance, I currently pay 7.50 for unlimited internet, the highest I ever paid was 15.00. So lets say you pay the highest rate.. that would be 10.00 saved there. Try comparing providers, you would be surprised what they will do to gain a customer.
Your contents insurance seems quite high as well you could cut half of that at least.. giving you an extra 22.00.
Your husband pays maintainance, so I think a compromise for the family`s sake is more than necessary. The `other insurance` and the bank charges MUST go. That would be another 24.00 + 25.00.
Try calling your mobile providers, explain the situation and ask to go on a cheaper plan, you might be able to save some money on there as well. And once the contracts expire, just move straight to PAYG, that way you only spend what you can afford.
Also, I think the holiday fund should be post-poned for when you are in a better financial situation.
I noticed you have 2 cars but only your OH works full-time and you do your Avon rounds. Cant you do that when your OH is back home from work or during the weekends? So instead of having 2 cars to pay MOt, Car tax, petrol, insurance, service.. you would have only one and I am sure a lot could be saved just there. Dont get me wrong, I know how nice it is to have 2 cars and all the comfort. We used to have 2 cars once but when I thought of all the money it was going towards the second car I gave it up. I work fulltime, but have decided to change my working hours for when hubby is home so we could save on car expenses. In other words, now we dont have weekends as a family - because I work when He is home - but it is a sacrifice I am willing to do in order to see us debt free, if you know what I mean.
It is all about compromise.
So, without much struggle (other than trying to put this in your OH`s head lol) I can see 81.00 in pontential savings there, with much more to be saved if you consider the car option.
You are doing really well with your groceries budget, just make sure you meal plan and dont go over it.
I wish you all the best x Hope we can all contribute a little bit and help you a lot.
xxx
L