Debt free newbie!

MFWannabe

Matt37 wrote: »

Ok so I have updated and adjusted my budget, I had missed some stuff off and I also got some figures wrong so it should give a better picture now. The Satellite/Cable TV heading covers all of my media phone/tv/web and I have found better rates for my insurances now too, but it still makes for scary reading! I have added the amount of money my partner transfers to my account every month as her income as I am just trying to work out my own affairs.

My target is to pay off my 2 credit cards initially so I am going to stop drinking, make sandwiches every day, stay away from Costa Coffee and try sell some stuff on Ebay... :A



Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 2056
Partners monthly income after tax....... 470
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2526

Monthly Expense Details
Mortgage................................ 336
Secured/HP loan repayments.............. 307
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 120 - You said in your first post that your partner pays this, or is it paid out of the money that she gives you?
Electricity............................. 50 - this is high, check comparison sites
Gas..................................... 66 - this is high, check comparison sites
Oil..................................... 0
Water rates............................. 51 - This is high, maybe a meter would be cheaper?
Telephone (land line)................... 0
Mobile phone............................ 20 - cut this to lowest tariff or go payg
TV Licence.............................. 12
Satellite/Cable TV...................... 50 - cut this to minimum package
Internet Services....................... 0
Groceries etc. ......................... 150 -
Clothing................................ 30
Petrol/diesel........................... 25 -
Road tax................................ 10
Car Insurance........................... 20
Car maintenance (including MOT)......... 20
Car parking............................. 10
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 13
Contents insurance...................... 10
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 10
Entertainment........................... 150 - You need to drastically reduce this, to maybe £50?
Holiday................................. 50 - You need to stop this for now until debts are paid
Emergency fund.......................... 20
Total monthly expenses.................. 1540


Assets
Cash.................................... 0
House value (Gross)..................... 210000
Shares and bonds........................ 0
Car(s).................................. 8000
Other assets............................ 8000
Total Assets............................ 226000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 159285...(336)......1.99
Secured Debt.................. 17200....(307)......1.99
Total secured & HP debts...... 176485....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Student Loan...................13500.....0.........1.5
Tesco Credit Card..............937.......25........0
Virgin CC......................12901.....130.......0
Car Loan.......................2200......208.......6.9
Total unsecured debts..........29538.....363.......-


Monthly Budget Summary
Total monthly income.................... 2,526
Expenses (including HP & secured debts). 1,540
Available for debt repayments........... 986
Monthly UNsecured debt repayments....... 363
Amount left after debt repayments....... 623

Personal Balance Sheet Summary
Total assets (things you own)........... 226,000
Total HP & Secured debt................. -176,485
Total Unsecured debt.................... -29,538
Net Assets.............................. 19,977

Hi
I've added some comments above. Start using at least £500 of the amount you have left over every month to make a big dent in those debts. You could have the Tesco credit card paid off in 2 months.
Do consider selling your car as you could clear your car loan and pay a good chunk off your Virgin card. Also if you don't have a car to run then it will cut your outgoings. How often do you use your car? Does your partner have a car that you can use if you need to?

Matt37

Hi thanks for getting back so soon!
My water is on a meter already the cost includes a sewerage charge of £26 a month which is expensive where I live for everybody. The gas and electricity were only moved last year and are high as they set the payments too low initially so this should reduce soon. My classic car was a labour of love and I am very attached to it having done every nut and bolt on it! However I am beginning to realise this might be my quickest way out of things? I will aim to clear the Tesco card by christmas and am going to try and keep to £600 a month extra on debt repayment.

Nargleblast

Hello Matt, looks like you are on the way to sorting out your finances!

When repaying loans and credit cards, one good way to organise it is to list your debts in order, highest APR at the top. The other debts you pay the minimum monthly payments. The one at the top with the highest APR you pay more than the minimum - in fact, you throw at it every month as much money as your budget will allow. It reduces quicker, you pay less interest. Once it is paid off, you then turn your attention to the debt with the next highest interest rate and target that one in the same way. And so on. Once cards are paid off, seriously consider destroying them. Of course, you may want to keep a card live for emergencies, people do that. In that case, put it in a safe place where you can't get hold of it easily so will not be able to use it in a frivolous manner. I have heard some people put it into a plastic bag then into a container of water and shove it in the freezer! They can't get to it easily for everyday spending, but if a crisis happens and they need it they just have to take it out of the freezer and defrost it for a few hours. Or you could lock it away in a filing cabinet at home. As long as it is not sitting in your wallet screaming "Use me! Use me!"

Nargleblast

You could also come and join in on the Octosyllabic October no spend day challenge, where we try and collect as many days in the month as possible where no money is spent. It's done by seriously thinking about your spending and planning it properly. It's mainly a female membership but there are some blokes on there who need your moral support! And gender isn't really an issue when finances are concerned, we are all in the same pile of brown stuff together.

tbourner

Matt37 wrote: »

The gas and electricity were only moved last year and are high as they set the payments too low initially so this should reduce soon.

NPower by any chance?

Matt37

Month 1 going well thanks to Ebay and a rethink about life, I even stopped social smoking which feels great!
Unsecured Debts Now:

Student Loan.................13200
Tesco Credit Card...........PAID OFF!
Virgin CC......................12770
Car Loan.......................1900

Also have a lodger moving in for £275pcm extra in spare room

Matt

niccatw

Excellent work Matt! You've inspired me to re-double my efforts! Here's to the next month... and then the next... you'll be well into the swing of it by then! (Actually, looks like you already are! ) Keep up the good work.

bloodofareptile

You are doing brilliantly! Well done!

Matt37

Thanks guys, hoping to knock at least 1k off before Christmas and have some spending money!
Forgot to mention current Acc now £300 in credit also for the first time in 10 years!!!
Matt

Matt37

Well a year has passed, I have remained a non smoker and even stopped drinking for now (1 month in!)
My debt has reduced but not as much as I would have liked the numbers are as follows:

Mortgage 158988
Top up mortgage 13200
Loan 12075
Student Loan 12600
Virgin C Card 2000
Car Loan 500

Lots of things got expensive this year including having to make 4 years back payment on my pension and Starting my MA. I still feel pretty flat, paying all I can in to this but soooo slow!

Matt