Time to face up to it then.....Any advice?

justmarried06

Afternoon everyone, I've been lurking for a while and have posted a couple of times over the last few days and have finally decided its time to face up to my debts! A lot of it has to do with the fact I got married recently but I can't blame my horrendous spending habits on that!!

My SOA is below, I'd better explain that the agreement myself and hubby have is that he pays all but £100 of the mortgage (just over £1000 per month - we managed to buy a house last November) and I pay all the rest of the bills including his mobile as that makes us (nearly) equal - I still pay a little less than he does on household stuff but its my loan and things that bump my spending up............

Deep breath, here we go -

Incoming - salary £1700 nett per month
no other incoming

£100 mortgage
£100 Mint card (£4900 balance and 15.9% apr I think)
£40 MBNA (£2100 balance 16.9% apr)
£2 cancer research
£100 student loans
£125 ING savings account for emergencies etc
£26 bldgs & contents insurance
£288 loan (£7188 balance 7.9% apr)
£45 hubby's mobile bill
£40 my mobile bill
£61 accident/sickness/unemployment insurance
£11 TV licence
£103 coucil tax
£17 water rates
£120 Egg (£5100 balance 15.9% apr)
£104 life & critical illness cover
£13 pet insurance
£40 gas & electric (although we're on key meters so thats set to go up now the winters coming in!)
£200 food
£30 petrol
£150 cigarettes a month (omg it looks like a horrendous amount when you write it down)
£100 spends (like coffee's, lunches at work etc)
£10 union membership

total outgoings - £1825

Plus I have a £2250 overdraft that I live in and that charges me nearly £20 a month interest.......I've arranged to surrender my Axa Sun Life policy today and although I'll lose about £800 of what I've put in at least I can make better use of the money - not sure where is best to spend it though? Do I clear my overdraft down, or use it on one of the cards?

I've joined Quidco, just as well as my car insurance is due at the end of the month which I usually pay on a credit card in one lump so I might get some money back on that...........

Any more ideas? I'm open to anything! (and I just know the smoking will be the first thing to go!!!!):o

JM

Mrs_pbradley936

Hello and welcome.

Well you are right about the smoking! The other obvious one is the ING saving account for emergencies – as a rule you should not be saving while you have debts. How long have you had the account and how much is in there? Your mobile phone bills seem very high to me. Next is all that insurance really necessary? If you have 100% mortgage it may well be but I would look into bringing that down. That’ll do to start with.

Storm

Hello and welcome :hello: and congrats on taking the first step and posting your SoA. I'm not one of the experts, but here's my opinion for what it's worth,

justmarried06 wrote:

Incoming - salary £1700 nett per month
no other incoming

£100 mortgage
£100 Mint card (£4900 balance and 15.9% apr I think)
£40 MBNA (£2100 balance 16.9% apr)
£2 cancer research This can go
£100 student loans
£125 ING savings account for emergencies etc Maybe reduce this/stop altogether if you've got a reasonable amount put by
£26 bldgs & contents insurance
£288 loan (£7188 balance 7.9% apr)
£45 hubby's mobile bill
£40 my mobile bill Both these are high, can you get cheaper contracts, switch to PAYG
£61 accident/sickness/unemployment insuranceIs this the cheapest deal?
£11 TV licence
£103 coucil tax
£17 water rates
£120 Egg (£5100 balance 15.9% apr)
£104 life & critical illness cover Can't you combine this with your other insurance?
£13 pet insurance
£40 gas & electric (although we're on key meters so thats set to go up now the winters coming in!)
£200 food This is high for 2 people
£30 petrol
£150 cigarettes a month (omg it looks like a horrendous amount when you write it down) Is this both of you? Could you at least switch to roll ups if not ready to quit?
£100 spends (like coffee's, lunches at work etc) A spending diary will help you keep track of exactly what it's being spent on
£10 union membership

total outgoings - £1825JM

You haven't got a budget for clothes/presents/haircuts etc either, nor for car tax/mot/repairs.

I know you've said that the debts are yours, but if your hubby has got more 'spare' cash each month than you it may be worth sitting down and re-evaluating your finances. You're actually in a trickier position than him because a lot more of the things you pay for are variable (such as mobile phones & utility bills) and are reliant on him as well as you making the effort to keep the costs down.

I'm sure better people than me will be along soon anyway - good luck

Storm

Dolly_Smith

hi there - you're spending a big wodge on life/critical illness, etc. insurance. Are they definitely the cheapest? Do you even need them?

the other thing I'd say is, why do you have that arrangement with OH? it would probably be easier to split the mortgage in two and then both of you pay for the bills that you incur. Anything joint just split down the middle. It would be easier to keep track of everything that way. How do you know he's not going to have a £100 mobile bill one month which would knock your budget out?

APRs are high on the cards too and the smoking.... well I'm a smoker so I know how hard it is to give up. Can you at least cut down a bit - even cutting that in half would help

CLAPTON

just to clarify who pays for car tax/insurance/servicing/AA,RAC/ etc and who pays for clothes, holidays, presents,xmas, landline, internet, going out, any sky?

do any of the CCs/loans have PPI?
how much is your emergency fund?

are student loans 'old style loans ' or what?

your spending on sickness etc insurance adds to 164 ...are you convinced that this is really necessary?

cigarettes ....well if you can ir really must go

work lunches .. take packed lunches

normally i'ld recommend you use your 800 to pay off the debt with the highest APR but as several banks seem to be getting a bit difficult about long term overdrafts you might want to pay some of that off.

justmarried06

Thanks for your help so far, there's some food for thought there!!

With regards the insurances, we have a 100% mortgage and neither of us get any benefits through work (except for death/accident at work for me) so we consider it a necessity - as well as the mortgage company!! The ASU was an extra but hubby's brother had a very bad car accident a few months ago and they didn't have the cover and now are up the creek financially as it were so its made us extremely risk averse.........

My student loans are the old style yes, so are costing me rather than coming out of my salary, but at least I know they'll be gone in a couple of years - unfortunately I earn too much to be able to defer any more!

If we go away its usually to my parents holiday flat on the south coast so that doesn't cost us much (usually £10 a weekend) and we don't tend to buy clothes or music or anything. we already have FreeSat and don't have a landline. I've always said no to PPI and car insurance has always gone on a card - RAC did too although this was only taken out in August so doesn't need to be renewed till next year.............Emergency fund has been dipped into quite a lot recently so only has £250 in it at the mo

I know the APR's are high - I've just been accepted for the new M&S card offer of 3.9% LOB just got to wait and see what limit I get to try and get rid of one of those.....

Is there anything else I can do?

JM

AMILLIONDOLLARS

Are all the Loans/credit cards yours?

I would suggest that you both try to take out the M&S Morethan Credit Cards, They are doing Life of Balance at 3.9% with no transfer fee at the moment. Then attempt to transfer as much of the credit card debt onto these cards, close down/DESTROY the old cards and DO NOT SPEND ON THE MORETHAN CARD UNTIL YOU HAVE CLEARED IT. This at least will cut down on the interest you are paying at the moment.

AMILLIONDOLLARS

Reply must have crossed!:D:D

justmarried06

At least I know I'm thinking along the right lines!!!!

Welshlassie

Hi, well done on posting your SOA, its hard but worth it.

Have a look at the snowball calculator http://www.whatsthecost.co.uk/snowball.aspx to give you some idea of when this will all be paid off, it will also show you the best order to pay things off.

Also consider giving CCCS or Payplan or CAB as call to discuss a plan.

Cutting down your outgoings:
Stop the Charity donation (I know it's only £24 a year but its better paying off your debts at the moment you can always set it up again when you are flush again)
You have alot of insurance, firstly do you really need it, if so have a shop around for a better deal that is really expensive
Your mobiles are high, but I notice you don't have landline/boardband listed, is this because you don't have any or have forgotten them, consider going PAYG or reducing your package.
You should reconsider your ING savings amount, that £125 is better going towards your debts at the moment, add that amount to the snowball calculator and watch your debt free date come down, by months.
Pet insurance, have a look at Martins article to find cheaper policy.
Cigarettes - stop or swap to roll ups, go see your doctors for a Nicotine replacement prescription if you want to give up and need help.

You haven't included anything for socialising, holidays, birthdays, Christmas, MOT, car tax, insurance - how are these covered??

Any particular reason why you and DH have split it this way. Do you have a joint account that you can pay your share of the bills into and out of to keep the money separate, this will show you what you have left to throw at your debts??

Best of luck.