Outgoings higher than my income

kaom

(Moved from other area of the forum)

I'm in a right old pickle. My monthly outgoings are significantly higher than my income and I'm at a loss as to what I can do.


My outgoings are a combination of standard stuff (no extras at all) and a divorce maintenance fee. I'm remarried and have a child with my wife and 2 children with my ex-wife. My maintenance fee (along with all my outgoings) aren't changeable.


My outgoings are as follows:
Maintenance = £500
Credit card = £120
Rent = £850
Council tax = £132
Electricity = £34
Gas = £50
Food = £280
Petrol = £120
Direct debits (mainly life cover with 2 payments to charities) £40
Clothes £50
Phones £30
Internet £20
TV £15
Home insurance (paid annually)
Water £50 (as it's been pro rata and the water company spent ages before sending the bills)


Outgoings are £2291


My income is £35k per annum. Which works out as £2172. Plus I get £82 every 4 weeks for child benefit. Total income is £2254.


So, you can see it's pretty tight. Trouble I'm having is because of one off payments such as car problems/MOT/insurance/tax/maintenance (which I paid for in one go), unforeseen problems, etc. These one off items add up to £400 to £500 (variable) or so per month which I don't think is too excessive and I really do try to keep a lid on it as much as possible.


I'm in desperate need of help - usually I try to help myself out. As part of the divorce settlement I walked away with some money which I invested in shares. The shares are currently worth £40k (a bit lower than the price I paid) – the idea was to build up a nest egg to use as a deposit on a house (I live in St Albans where £40k isn't anywhere near enough for a deposit).



However by trying to help myself these shares are becoming a problem. I believe that if I didn't own any shares I might be able to get some financial help but because I have “savings” of more than £16k it messes this possibility up for me. Trouble is if I sell all or some of the shares it only helps me out temporarily. I'll still be in the same boat in a few years time. I don't want to be a burden on the state and would rather pay my own way by using the shares in a positive and long term way. It seems that if I'm prepared to lose my future deposit the state will step in to help me after.


I feel like I'm going around and around in circles and am finding it hard to find a solution. To make matters worse I've just learned that my bank has just reduced my overdraft limit which I was actually relying on to get me by for the time being. I know I'm “lucky” to have these shares on the one hand and that effectively I could cash them in and resolve my cash problems, but it's so short termist that I know it can't be the best approach for my family's future, but maybe that's my only option?


Sorry for such a long post - any helpful advise would really be welcomed

Tixy

Hi

I would suggest you post up the same info as above in a statement of affairs using this http://www.makesenseofcards.com/soacalc.html, this format also allows you to budget for the costs such as car servicing mot etc, estimate the annual cost for these and then enter 1/12 in the monthly SoA. This will give a full picture of you financial position.

Include all your debts including the overdraft etc and try to put in the APRs etc if you know them.

What income does your wife have coming in?

I think some of you outgoings could be reduced, eg groceries at £280 is quite high for a family of 3, you could reduce the clothes spend down etc. Plus at the moment you cannot really afford to be giving to charities.
How competative is the rent for where you live? would it be feasible to find somewhere cheaper to rent?

How old are the children from the previous marriage? how long will you have to pay this maintenance for?
whilst selling the shares may seem a short-term solution if this cost will stop in the next few years it could be an option.

Billy_two_speakers

kaom wrote: »

(Moved from other area of the forum)

I'm in a right old pickle. My monthly outgoings are significantly higher than my income and I'm at a loss as to what I can do.


My outgoings are a combination of standard stuff (no extras at all) and a divorce maintenance fee. I'm remarried and have a child with my wife and 2 children with my ex-wife. My maintenance fee (along with all my outgoings) aren't changeable.


My outgoings are as follows:
Maintenance = £500
Credit card = £120
Rent = £850
Council tax = £132
Electricity = £34
Gas = £50
Food = £280
Petrol = £120
Direct debits (mainly life cover with 2 payments to charities) £40
Clothes £50
Phones £30
Internet £20
TV £15
Home insurance (paid annually)
Water £50 (as it's been pro rata and the water company spent ages before sending the bills)


Outgoings are £2291


My income is £35k per annum. Which works out as £2172. Plus I get £82 every 4 weeks for child benefit. Total income is £2254.


So, you can see it's pretty tight. Trouble I'm having is because of one off payments such as car problems/MOT/insurance/tax/maintenance (which I paid for in one go), unforeseen problems, etc. These one off items add up to £400 to £500 (variable) or so per month which I don't think is too excessive and I really do try to keep a lid on it as much as possible.


I'm in desperate need of help - usually I try to help myself out. As part of the divorce settlement I walked away with some money which I invested in shares. The shares are currently worth £40k (a bit lower than the price I paid) – the idea was to build up a nest egg to use as a deposit on a house (I live in St Albans where £40k isn't anywhere near enough for a deposit).



However by trying to help myself these shares are becoming a problem. I believe that if I didn't own any shares I might be able to get some financial help but because I have “savings” of more than £16k it messes this possibility up for me. Trouble is if I sell all or some of the shares it only helps me out temporarily. I'll still be in the same boat in a few years time. I don't want to be a burden on the state and would rather pay my own way by using the shares in a positive and long term way. It seems that if I'm prepared to lose my future deposit the state will step in to help me after.


I feel like I'm going around and around in circles and am finding it hard to find a solution. To make matters worse I've just learned that my bank has just reduced my overdraft limit which I was actually relying on to get me by for the time being. I know I'm “lucky” to have these shares on the one hand and that effectively I could cash them in and resolve my cash problems, but it's so short termist that I know it can't be the best approach for my family's future, but maybe that's my only option?


Sorry for such a long post - any helpful advise would really be welcomed

sell some shares and pay off loans credit cards and all other debts

stop buying clothes for a few months too and look for cheaper phone if you can

then start saving the money you would have paid on credit card and clothes but dont buy more shares save with bank or building society you should not have all eggs in one basket all so check your shares are a good spread of blue chip companies PRU M&S Tesco even BP

others will be along soon with other ideas

chopper_99

If you're incomings are less than your outgoings then in the long term things will only get worse. Without a doubt you should sell off some shares to pay off the credit card in my opinion, doing that should save you money in the long run. On top of that cash in enough to leave you with a bit of an emergancy fund and you should be ok.

Stop giving to charity for now if you can't afford it and cut down what you're spending on clothing for a while.

HappyMJ

You shouldn't have high interest debts and low yield investments. I suggest you sell some of the shares which should save you the £120 credit card repayment every month. Just doing that alone and you'll have an excess every month.

I calculate your monthly child maintenance payment to be £369 per month. You can reduce your income by 15% to pay for the child with you then for 2 children you should pay 20% of the remainder to your ex. I'd go back to CSA and ask for it to be reduced to that amount. Or...does it include a bit of spousal maintenance? Or some arrears? Then it's probably right. When the arrears are clear or the extra payment requirement is finished you will have even more excess income. You might just need to spend some of your savings in the short term to cover your day to day living expenses in the knowledge that your future expenses will be reduced.

RAS

kaom wrote: »

My outgoings are a combination of standard stuff (no extras at all) and a divorce maintenance fee. I'm remarried and have a child with my wife and 2 children with my ex-wife. My maintenance fee (along with all my outgoings) aren't changeable.


My outgoings are as follows:
Maintenance = £500

Why is the maintenance not negoitable. I did a quick CSA calculation and I make your liability £370 per month.