Newbie here - updated to include SOA

Verbatim

Well done for posting the scary SOA!
Yes the fuel costs look high and Virgin do a combined phone/TV/broadband deal for around £35. I'd research on the other boards a bit before ringing them. If you can get another provider in your area you could threaten to leave them as part of your negotiation tactics.
Do you need to put away £60 a month for clothes? Seems a bit high as does car insurance, but I'm guessing that's more expensive due to your OH's disability? You could shave more off the grocery bill, drop brands for basics/value items, meal plan and make a shopping list. But as your debt is small and income good you won't take that long to pay it off now you've made a start.

Katie-Kat-Kins

kevstanley wrote: »

OK, I sat down this morning and tried to work out an SOA. I've been honest about expenditure even where I'm a bit embarrassed by it.


Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 2 - how old? Could they be helping out? Paying "keep" if over sixteen, getting a saturday job/paper round instead of receiving pocket money if 13-16.
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 0
Partners monthly income after tax....... 1336
Benefits................................ 1010
Other income............................ 0
Total monthly income.................... 2346
Monthly Expense Details
Mortgage................................ 308.7
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 117 check that you have correctly got the monthly cost here, some people pay 10 payments over the year, it can be easier to get 12.
Electricity............................. 71 - that is crazily high - more than I pay in a 3 bed property that is all electric! Take meter readings and get your supplier to update your account, if you have a surplus reduce your DD and ask for a refund of the surplus which can be put towards your debts. If you are paying off a debt ask whether it can be spread over a longer period. Check that you are on the best tarriff and whether you are entitled to any social tarriff with your partner's disability.
Gas..................................... 100 - on top of your electric this is high! Make the same checks suggested for the electric.
Oil..................................... 0
Water rates............................. 36 - Is this rates or a meter? If it is a meter try to cut your usage to save money. Shorter showers, less baths, only full loads in the washing machine, get a water but for the garden, use the half flush on the loo.
Telephone (land line)................... 20 - You should be able to get a better deal than this. Look at inclusive deals to include your broadband.
Mobile phone............................ 15
TV Licence.............................. 6.25
Satellite/Cable TV...................... 24.5 - are you in contract? If not then drop this to freeview, if you are ask whether you can reduce your package. The only expecption is if you can get a really good deal that includes phone and broadband, I know sometimes you have to take out tv to get the cheapest deal and it can work out very economical, especially with virgin.
Internet Services....................... 37 - that is really high!!! Shop around for a better deal.
Groceries etc. ......................... 300 - not bad for a family of four. Are you sticking to it? This could be where your surplus goes. If you are sticking to it see if there are any more savings to be had by dropping a brand or cutting back on treats.
Clothing................................ 60 - sounds realistic but you could challenge yourself to have a couple of months "shopping from your wardrobe" in order to save some money. Try to economise where you can and put any spare money into paying off the debt.
Petrol/diesel........................... 60
Road tax................................ 17
Car Insurance........................... 81 - High for just one car, compare prices and see if you can switch.
Car maintenance (including MOT)......... 30
Car parking............................. 0
Other travel............................ 200 - what is this and why is it so high? Any scope for reducing it?
Childcare/nursery....................... 0
Other child related expenses............ 66 - what is this and do you really need it?
Medical (prescriptions, dentist etc).... 20
Pet insurance/vet bills................. 10 - compare prices for the best deal
Buildings insurance..................... 37 - compare prices for the best deal
Contents insurance...................... included above
Life assurance ......................... 0
Other insurance......................... 10 - what is this and is it necessary? Could you get it cheaper?
Presents (birthday, christmas etc)...... 40
Haircuts................................ 15
Entertainment........................... 50 - not unreasonable but as with the clothes, could you have a few months drive to reduce it so that you can chuck extra money at the debt?
Holiday................................. 20 - if this isn't already booked consider whether you should have one and whether you can reduce the cost of it. It depends how
Emergency fund.......................... 50 - do you actually have an emergency fund? If so it would be worth using some of it to pay off the debts and starting to build it up again especially as you haven't defaulted and therefore in an emergency could access credit if necessary.
partner's pension....................... 75
disability related expenses............. 100
Total monthly expenses.................. 1976.45

Assets
Cash.................................... 0
House value (Gross)..................... 270000
Shares and bonds........................ 0
Car(s).................................. 5000
Other assets............................ 0
Total Assets............................ 275000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 60000....(308.7)....4.24
Total secured & HP debts...... 60000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
John Lewis ....................5000......150.......16.9
Total unsecured debts..........5000......150.......- - Check out the 0% deals available and whether a balance transfer might help. Basically you need to focus on paying every spare penny over to discharge this debt, and stop spending on it so it doesn't increase.

Monthly Budget Summary
Total monthly income.................... 2,346
Expenses (including HP & secured debts). 1,976.45
Available for debt repayments........... 369.55
Monthly UNsecured debt repayments....... 150
Amount left after debt repayments....... 219.55 As you know you need to identify where this goes each month.
Personal Balance Sheet Summary
Total assets (things you own)........... 275,000
Total HP & Secured debt................. -60,000
Total Unsecured debt.................... -5,000
Net Assets.............................. 210,000
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.


I can immediately see areas which need addressing - those fuel costs are insane - we don't live in a mansion - and I wonder why they are so high. So need to contact npower about that. Also virgin media re: TV/broadband/phone to see how that can be reduced.

Some things are quite difficult to quantify. We have a high level of benefits, because my OH has a significant disability. So I've put disability related expenses in, but I'm not sure that would be a comprehensive figure. For example, the last time he had to replace his laptop, it was £1500 - same specs as my average one (he wasn't just being greedy!), but with the adaptations he needed, that was the price. So that sort of thing is very hard to calculate. When we replace household items, we need to make sure he can use them, which often means that we need to pay a bit more. I hope all that makes sense.

Nevertheless, I've tried to calculate as accurately as I can. And I can see that there should be money left at the end of the month, which, if I were to switch to a 0% card and repay more, would help enormously with the debt repayment. The thing is, although there is clearly money left over, it isn't actually there at the end of the month - it must just get frittered away. So I am planning to begin making a note of everything we spend, so that I know where it's all going, and then hopefully can cut back accordingly.

I'm also currently looking for part time work (not employed at the moment), so that might help somewhat.

Looking at my figures, some do seem extravagant (and there was I saying I thought we were frugal!). Having said that, we've cut our grocery bills from something like £450 to £300 in the last year, so we are getting there, albeit slowly.

Trying not to beat myself up over being such a flake about all this for so long, and it's really scary putting the finances "out there" - please be gentle!

Well the good news is there are plenty of savings to be made and you are already showing a surplus so you should be able to pay off some big chunks and get rid of that debt fairly quickly.

I would set up a direct debt to your card to pay off the largest sum you know you can safely afford each month, and then if you manage to save any extra during the month you can pay some extra off.

Good luck!

kevstanley

Thanks for the replies - very helpful (and supportive).

I don't think we do need to put £60 to clothes, but I was working with what I could find of the last year's figures, and trying not to hide our foibles I can certainly cut back (already have - a lot, but certainly could do a bit more!). OH is hard on clothes and shoes, and the two children will not stop growing! But I still think we can cut that down a bit.

Car insurance is just me, I'm afraid - well, sort of. I lost my NCB last year, because one of OH's PAs had an accident on my insurance, and then I had one too - and my NCB protection (many years' worth) only covered one accident. Doh! So I made a claim AND lost NCB all in one fell swoop. Have since sorted out the issue of PAs being on my insurance, so careful driving on my part and shopping around later this year when I'm up for renewal should begin to address that.

With regard to groceries, I'm buying almost entirely own brand, have switched from Sainsburys/Ocado deliveries to shopping in person in Morrisons - and can't believe how much we're saving already. Some things I buy value, but others seem pretty nasty. I shop for bargains, and stock up when I can. I cook from scratch too. Obviously I need to keep revisiting this one though. Now, if I could get the family to stop grazing all the time I might get somewhere

I need to get an idea of our actual fuel usage rather than just costs, and then shop around - or is it worth calling to negotiate with my current supplier first?

The TV etc can begin to be addressed by having far fewer channels. Not sure about dropping a level of broadband, because we're quite heavy users. We can drop a couple of bits from the phone bill too.

I think I'm going to need to seriously overhaul what we laughably call our filing system so I can find relevant stuff.

tbourner

You're saving £20 for holidays and £50 for emergencies? Are these real savings or just figures you think you spend through the year? I'd advise keeping a savings account (I use ING, you can track several accounts easily online) and putting this money into them each month so it's really there and you know how much you have for holidays and/or emergencies.

dollybeads

Hi there, and well done for posting your SOA, scarey isn't it, but works wonders!

I am pretty new to all of this and have significant debts, but, keeping a spending diary has helped me to see where the money is going (I was spending approx £20.00) per day on incidental spends, ie coffee, lunch at work, magazine etc. I also joined a number of the challenges on here, no spend day challenge (for incidentals), the monthly grocery challenge, and the weekly spend challenge. You set a limit and report back on progress, this helps a great deal, as you can share success and failure and receive support either way.

Also the dreaded shopping list and only buying whats on it, is an enormous help. All really simple basic budgeting stuff, but it sure does work. I am embarrassed that I have never lived like this before, but i guess I can't change what has happened but giving it 100% from here on in.

Good luck to you and keep posting it will be great to hear how you progress. Dolly x

Katie-Kat-Kins

kevstanley wrote: »

Thanks for the replies - very helpful (and supportive). No problem it is what the board is for!

I don't think we do need to put £60 to clothes, but I was working with what I could find of the last year's figures, and trying not to hide our foibles I can certainly cut back (already have - a lot, but certainly could do a bit more!). OH is hard on clothes and shoes, and the two children will not stop growing! But I still think we can cut that down a bit. That is the best way to do it, put in your actual figures first time round, then you can come up with your "target budget" and make your cuts. For a family of four with growing children and a disabled adult £60 is probably fair long term but cutting down for a few months will free up some cash.

Car insurance is just me, I'm afraid - well, sort of. I lost my NCB last year, because one of OH's PAs had an accident on my insurance, and then I had one too - and my NCB protection (many years' worth) only covered one accident. Doh! So I made a claim AND lost NCB all in one fell swoop. Have since sorted out the issue of PAs being on my insurance, so careful driving on my part and shopping around later this year when I'm up for renewal should begin to address that. - Not sure how far off renewal you are or whether you have already paid or are paying installments but have a read of the insurance articles on here, it might be worth getting quotes even if you aren't due for renewal yet.

With regard to groceries, I'm buying almost entirely own brand, have switched from Sainsburys/Ocado deliveries to shopping in person in Morrisons - and can't believe how much we're saving already. Some things I buy value, but others seem pretty nasty. I shop for bargains, and stock up when I can. I cook from scratch too. Obviously I need to keep revisiting this one though. Now, if I could get the family to stop grazing all the time I might get somewhere Well done! Have a look at the Old Style board for tips on cutting your grocery bill, meal planning is particularly good. If the kids graze don't buy the stuff they graze on and make sure they have decent filling meals at meal times. They probably aren't actually hungry and picking at biscuits etc is a bad habit to get into.

I need to get an idea of our actual fuel usage rather than just costs, and then shop around - or is it worth calling to negotiate with my current supplier first? Step one, provide a meter reading and get an up to date picture of where you are at. If you are in credit shop around straight away for the best deal. If you have a debt with the energy provider then you probably won't be able to move until it is paid off but you will be able to ask your current supplier to move you to a better tarriff. I would be inclined to monitor your usage for a few weeks so that you have decent stats with which to do a comparison, particularly if you are on eco7 and need to decide whether it is worth bothering with or not. If you monitor your usage you will also have a baseline figure from which to set a target for cutting down your usage (which is green and MSE). Take meter readings weekly (or daily if you are feeling enthusiastic) and use a spreadsheet or a web tool to compare your use. There is a good one recommended on the forum I'll post a link if I can find it.

The TV etc can begin to be addressed by having far fewer channels. Not sure about dropping a level of broadband, because we're quite heavy users. We can drop a couple of bits from the phone bill too. You should save shedloads here. As a guide we pay less than £20 for phone and broadband included (with talk talk). We aren't in an area where there is much choice and we never go over our inclusive calls/downloads. Admittedly we don't make many landline calls but it shows there are savings out there. I believe that virgin have some good deals if you take phone, internet and tv with them.

I think I'm going to need to seriously overhaul what we laughably call our filing system so I can find relevant stuff.

Lots of scope for savings and you can actually have fun doing all the comparisons and negotiating good deals. Record all your figures and things so that you get the satisfaction of knowing how much you have saved. Use the snowball calculator on make sense of cards to work out how long it will take you to pay off the debt with your current repayments and with the increased payments you can make eachtime you get a better deal. So if you save £20 a month on your energy bills work out how much that shaves off your debts if you pay it all over to your credit card.

MSE can be fun and adictive!!! :beer:

kevstanley

Wow, Katie-Kat-Kins, just seen your detailed comments - thanks!

The kids are 10 and 13, and the elder is on the lookout for ways to earn a bit of money herself, and has already done the odd stint as a relief paper girl. The costs related to them are pocket money, and activities - both v. sporty, and members of clubs. I would be really reluctant to stop that unless we were in dire straits. Playing football keeps the teenager busy, and that's never a bad thing

You're right about the council tax - will amend that.

I think we are sticking to the grocery bill. For instance, I paid £65 in Morrisons yesterday for a week's shopping, but I know there will be top ups of milk, bread (am trying to be organised enough to make my own all the time rather than just some), the odd bottle of wine (I know, gotta cut that down, although again, we've cut down masses already there - but still...)

The Virgin Media thing is a package, which I just broke down for the sake of the SoA. Will be looking at cutting that.

I calculated emergency fund on what we spent on repairs etc last year. No, there isn't an actual fund, but that's more or less what last year cost us.

The extra insurance is plumbing/drain cover. No, not necessary, and can be cancelled.

I think we could certainly have a couple of months' moritorium on clothes purchases - might be a challenge the whole family will get behind!

Water is rates. We are trying to save water, but I suppose if we're paying rates it doesn't make any difference to that particular cost.

I'm wondering if the high cost of electricity harks back to the days when I was using a tumble dryer every day. I hardly use it at all now, but it might be that the supplier hasn't taken changes of usage into account. Hmmm. It can't be just that, but might have something to do with it.

Holiday fund is me being super realistic. We don't pay for hols, as we have a place to stay belonging to family. But travel there (petrol) and extras add up quite a lot. I think we can cut that by quite a bit this year.

Travel is rail fare for OH's work, and taxis for him. Honestly, I can't see us being able to cut that very easily. He can use public transport when he's familiar with a place, but not otherwise.

Those were really really helpful comments - thanks so much for taking the time to go through it all. I'm off to make a list of price comparisons/calls I need to make, I think!

Sorry for waffling!

Katie-Kat-Kins

kevstanley wrote: »

Wow, Katie-Kat-Kins, just seen your detailed comments - thanks!

The kids are 10 and 13, and the elder is on the lookout for ways to earn a bit of money herself, and has already done the odd stint as a relief paper girl. The costs related to them are pocket money, and activities - both v. sporty, and members of clubs. I would be really reluctant to stop that unless we were in dire straits. Playing football keeps the teenager busy, and that's never a bad thing

You're right about the council tax - will amend that.

I think we are sticking to the grocery bill. For instance, I paid £65 in Morrisons yesterday for a week's shopping, but I know there will be top ups of milk, bread (am trying to be organised enough to make my own all the time rather than just some), the odd bottle of wine (I know, gotta cut that down, although again, we've cut down masses already there - but still...)

The Virgin Media thing is a package, which I just broke down for the sake of the SoA. Will be looking at cutting that.

I calculated emergency fund on what we spent on repairs etc last year. No, there isn't an actual fund, but that's more or less what last year cost us.

The extra insurance is plumbing/drain cover. No, not necessary, and can be cancelled.

I think we could certainly have a couple of months' moritorium on clothes purchases - might be a challenge the whole family will get behind!

Water is rates. We are trying to save water, but I suppose if we're paying rates it doesn't make any difference to that particular cost.

I'm wondering if the high cost of electricity harks back to the days when I was using a tumble dryer every day. I hardly use it at all now, but it might be that the supplier hasn't taken changes of usage into account. Hmmm. It can't be just that, but might have something to do with it.

Holiday fund is me being super realistic. We don't pay for hols, as we have a place to stay belonging to family. But travel there (petrol) and extras add up quite a lot. I think we can cut that by quite a bit this year.

Travel is rail fare for OH's work, and taxis for him. Honestly, I can't see us being able to cut that very easily. He can use public transport when he's familiar with a place, but not otherwise.

Those were really really helpful comments - thanks so much for taking the time to go through it all. I'm off to make a list of price comparisons/calls I need to make, I think!

Sorry for waffling!

Don't forget to read the articles on here before you do your comparisons there are useful tips and tools for getting the best results with the least work!

I'm sure you'll get a grip on it soon and you'll feel much more positive when you have taken control.

kevstanley

I feel like i just keep saying thanks to everyone, but seriously, all your questions/comments are incredibly helpful. I'm glad I put today aside for this.

Have just called npower and am £533 in credit - that's nuts! Have given them up to date readings, and asked them to reassess with immediate effect. We are also due £100 from them for being with them for a year, so when I have that payment, and the amended direct debit costs in the bill I am expecting in the next week or, I can shop around.

Why haven't I been doing this all along?

kevstanley

tbourner wrote: »

You're saving £20 for holidays and £50 for emergencies? Are these real savings or just figures you think you spend through the year? I'd advise keeping a savings account (I use ING, you can track several accounts easily online) and putting this money into them each month so it's really there and you know how much you have for holidays and/or emergencies.

These are just drawn from expenditure last year, but the idea of putting money into another account is great, and might ease the panic when things go wrong in the house too. Thanks for that.