Learning to Live on Less!

White_Iris

I've been lurking on this website for about four years but rarely post and am still a bit dubious about starting a diary but I hope it will help me focus on clearing debt and managing our money a bit better.

DH and I are struggling a bit at the moment - he earns a decent wage but we have very little free spending money, mainly because we're paying almost $800 (can't get the pound sign to work?) a month repaying debt. All the bills get paid, there is money for food and petrol (just!) but that then only leaves about $100 a month for everything else.

It's entirely our own fault - for the last 10 years we've made the most of loans and credit cards, paying minimums and remortgaging to consolidate only to start spending all over again. We were young, stupid and lucky enough to buy a house at the start of the housing boom, which made a lot of money very quickly. We've moved twice since then but our last move was in August 2007 - we paid too much and now we're pretty much stuck with a large, expensive, inefficient house in an area we don't really like any more (we're trying to sell but that's a whole other story). I really wish someone would have said NO to us, or told us that we couldn't afford to buy everything we wanted but realistically we wouldn't have listened. So now we're in the position where all we can do is tighten our belts, grit our teeth and wait until it's all paid back.

DH works full time and I'm currently a SAHM looking after our year old twins. We live in the middle of nowhere and only have one car and no family near by, so the cost of transport to work and childcare for the twins would mean that for me to go back to work is unrealistic at the moment (and I don't really want to TBH - DH and I agreed a long time ago that I could stay at home to raise our children and we should be able to afford it if it wasn't for these darn debts!). I sell lots on ebay, do surveys, quidco etc. to make a bit of money but sometimes it feels like we're getting nowhere.

I'll put an SOA up in a little while and if anyone can give me some pointers that would be useful - I've checked it quite thoroughly but fresh eyes are always good. This has been quite a long first post but it feels good to stop bottling everything up!

Iris

White_Iris

No. adults...........2
No. children.........2
No. cars..............1

Salary.................0
Partners salary.....2350
Benefits..............130 approx. (currently only child benefit, waiting for renewal pack to re-claim child tax credits which were stopped as they think we earn too much)
Total income........2480 approx.

Outgoings
Mortgage............582.71
Council tax..........131
TV licence...........12.37
Water.................23 (metered)
Sewerage............18.89
Electricity............20
Oil......................50
Phone.................16
Broadband............16 (have tried to get this cheaper but very few companies will supply to us - variety of excuses, usually we're too remote, too far from the exchange etc.)
Life insurance.......22.44 (for both of us - cheapest we could find as I had medical problems several years ago)
Home insurance.....23.06 (buildings and contents - cheapest I could find this year as we had a claim last year)
Pet insurance........30.74 (for 2 large dogs - I look around every year and claim through Quidco, this is the cheapest I can get at the moment)
Sky......................22.50
NASUWT...............13.95 (husbands union fees - essential in his line of work)
Mobiles..................20 (one contract and one PAYG)
Emergency savings...25
Dog savings............50 (covers vaccinations, food etc.)
Car savings.............75 (covers insurance, MOT, servicing, TAX and general repairs)
Childrens savings........20
Grocery shopping.......150
Petrol.......................200 (we live in the middle of no-where down very winding fuel inefficient lanes - husband drives 20 miles a day to work and back and at the weekend we drive to visit family and friends etc. have the odd day out or go to town for shopping)
Total outgoings.......1514.66

Debts
Credit card.....150 (0% until Dec 2011) Balance - 4400

Loan 1..........483.17 (11.9% until Oct 2013) Balance at last statement (Jan 2011)- 12928.70 (no over-payments allowed)

Loan 2..........200 (7.79% until July 2027!!!!!) Balance at last statement (Mar 2011) - 19019.48 (over-payments allowed)(this was a loan that was linked to our mortgage but unsecured, so we got it at mortgage rates back in 2002 - "yay we can borrow 10k and it'll only cost us 200 a month" never crossed our minds that we'd be paying it for 25 years!)
Total debt................36348.18
Total monthly debt repayments.........788.17

Total outgoings (bills + debt).........2302.83

Money remaining.............................177.17


Ok, so that's a little bit more than I thought but still not a lot for the four of us. Anything I haven't listed (haircuts, clothes, presents etc.) comes out of that 177. We don't go on holiday. Any ideas where we could save? We don't need to cut it to the bone but any easy saving ideas would be appreciated.

NOTE: this has been revised in Post #140

White_Iris

I think that part of the reason I often feel a bit overwhelmed is that I'm trying to do too much with not very much money. I can't pay back masses from the credit card and build a decent emergency fund and overpay our long loan, so I need to focus.

The loans we have will just have to remain as they are at the moment. The big one finishes in just over 2 years, so if we can get by until then without getting extra debts we'll be a lot better off. The other, longer loan is more affordable and once everything else is clear we can think about over-paying that.

Target 1
We're currently trying to sell our house and move somewhere less rural (which will hopefully bring down our living costs) so I'm going to try to save for our solicitors fees rather than take it out of what little equity we'll have from the sale. The estimate we've been given is about $1200. Optimistically we might need this by August. Realistically I think I'll probably have longer to save up.:(

Target 2
The credit card debt is something I can tackle but I'm not going to be able to clear it all by the time the 0% period runs out so I'd like to get it down to 3K or less. We're already paying $150 a month towards it, so I only need to find another $350 over the next 7 months (or $50 a month) to get it to 3k by the end of the year - no problem!:cool:

White_Iris

I've been trying to think of ways to make the extra $50 a month towards the credit card but I haven't come up with any new ideas. I usually use the money I make on ebay to buy clothes for the children (they are clothes neutral - I sell the old stuff to buy the new stuff) but I have them kitted out for the next 6 months, so I was going to use anything in my PayPal account (from ebay, Pinecone and MySurvey) to go towards our conveyancing costs. I suppose I could use Quidco money and anything from YouGov and OnePoll for the credit card but I'm a long way from payouts on these sites. I'll have to think harder I guess.

HisDoris

Couldnt read and run! ... You seem to be living on very reasonable amounts and I dont see anywhere you could cut costs back on but just wanted to wish you luck with getting everything on track! Sorry I couldnt have been any help!

White_Iris

Thank you HisDoris - I thought I wouldn't mind if no-one commented on my diary but I was beginning to feel a bit lonely!

January20

I've just found your diary too! When you 0% rate ends on your credit card, what will the interest be? Do you know? Is your credit score good enough to apply for another 0% card at that time?

Can you stop the savings for the children for a little while and put that towards your solicitors' fees. Later on when you have more money, you could "catch up" with the children's savings perhaps?

White_Iris

Hi January20 - thanks for joining me! When the 0% ends I think the interest rate goes up to about 18% but we should be able to transfer it to another card.

The childrens savings are a one-year no-withdrawal type savings account, which you have to pay in to every month or you don't get the good interest rate. This finishes in July so only another 2 months of payments to go then that $20 will be re-purposed! We're very lucky in that my parents pay money into another savings account for them every month (the only grandchildren - they're going to be spoiled rotten!), so I'm not too concerned about keeping up with their savings at the moment but I would like to get the bonus at the end of the 12 months of saving.

That's another thing that frustrates me about our level of debt - in my mind the child benefit I get should be for looking after the children, I should be free to use it or save it for them but at the moment it get used to pay for the grocery shopping. I sometimes feel sad that I'm dressing them in second hand clothes and feel guilty that I'm not buying them new and pretty things but then with my sensible head on I realise that I'd probably still use ebay for their stuff at the moment anyway. Childrens clothes are ridiculously expensive given the amount of time they wear them for before they grow out of them and by the time they're old enough to complain about pre-loved clothes we will be out of this money pickle.

January20

I wouldn't worry about the child benefit. It's not paid to be saved up but to be spent, and whatever you use it for in your household, whether it is food, heating bill, etc the children are still benefiting. I never saved my CB for my dd. I couldn't afford. It all went in the pot. Even to this day! Frankly, I think if people can afford to save it, then they should not be receiving it because they don't need it! (I'll probably be flamed down for this comment at some point lol!)

Your children don't know they are wearing second hand clothes. It's great to recycle clothes. It's very green and it means that if the children ruin them, you are not too worried, so they can have a fun childhood, and children grow out of their clothes so quickly, it would be silly to spend lots of money on them! I used lots of second hand clothes for my dd too.

White_Iris

January20 wrote: »

Your children don't know they are wearing second hand clothes. It's great to recycle clothes. It's very green and it means that if the children ruin them, you are not too worried, so they can have a fun childhood, and children grow out of their clothes so quickly, it would be silly to spend lots of money on them! I used lots of second hand clothes for my dd too.

I noticed that my DD had worn a hole in the bottom of a pair of dungarees she was wearing the other day. I was a bit irked because they are really nice but also pleased that she's ruining clothes that cost £2 - £3 (ooh the pound sign is working again!?) from ebay and I didn't pay full price in Mothercare (I imagine they'd have been at least £15 new)...I did feel a bit smug about that LOL!

Flee_2

Hello White Iris, I have just noticed your diary. It is hard to try and cut down when there is nothing else you can do. I am the same. I have cut down so much that I don't know what else to do.
I hope you finally get sorted. It is hard to cut down when you have children to feed and clothe.
Good luck