My SOA - a bit more complex than most :-)

geoffhodge

Hiya,

My SOA is below. I have added some comments below to explain where some figures may seem unusual or different. There are a few things to bear in mind with this.

My wife works for a bank, so an IVA or Bankruptcy (or similar) would show on our credit file, which would mean she would be ineligible to work for the bank and would loose her job (so £700 /month less income).

We also have a son with severe learning difficulties, autism, ADHD and many other problems. A large portion of the debt is due to this (he flooded our first house and covered our second with paint - everywhere - was investigated by the insurance company and couldn't live at home for 6 months, but they wouldn't cover these expenses, only the direct costs - a lot is also ours, as well though). However, this means that we need to have a car as public transport is often not possible due to his issues (e.g. trying to run off buses/trains when they stop, impulsively running into the road - bit to old to restrain him now (is 11 years old)).

Have tried to get 0% interest cards and better mortgages/loan rates but am rejected for them so can't shift things around.

I've done my best so hopefully this will make sense

I look forward to any suggestions,

Geoff



Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 1 (on HP, 4 years left)

Monthly Income Details
Monthly income after tax................ 2600
Partners monthly income after tax....... 700 (500 after childcare vouchers)
Benefits................................ 680
Other income............................ 0
Total monthly income.................... 4080

Monthly Expense Details
Mortgage................................ 734 (interest only)
Secured/HP loan repayments.............. 152 (for car)
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 120
Electricity............................. 60 (fixed till end of year)
Gas..................................... 60 (fixed till end of year)
Oil..................................... 0
Water rates............................. 40
Boiler, Plumbing Cover.................35
Telephone (land line)................... 0 (combined with TV)
Mobile phone............................ 30 (2 phones, required for work in both cases)
TV Licence.............................. 0 (for some reason, Mother In Law likes to pay this - won't argue with that)
Satellite/Cable TV...................... 55 (includes land line and broadband)
Internet Services....................... 0 (included in TV. having broadband means I can claim callout allowance (included in income). Salary would be £300 less without this).
Groceries etc. ......................... 400 (I know this needs to be reduced, but given we already by Tesco Value everything and bulk-buy at Costco if cheaper, we are struggling to do this),
Clothing................................ 40 (this is an average as 'seasonal' - kids uniform is bought when needed, ours when clothes give up the ghost. This may be a bit more than we actually spend)
Petrol/diesel........................... 350 (we unintentionally bought the world's worst car for fuel economy - £14 in fuel to get to/from work. Will voluntary surrender on HP as soon as we are able to get a cheaper car)
Road tax................................ 27.5 (see petrol/diesel)
Car Insurance........................... 45 (due for renewal in August, this is based on quotes obtained so far)
Car maintenance (including MOT)......... 0 (we have none to put aside)
Car parking............................. 0 (comes out of salary at source, so already accounted for - £30 per month)
Other travel............................ 100 (travel for wife going to work, and on Monday/Tuesday I can get train which is cheaper - other days have to drive due to bad train times and kid school/playgroup pickup times)
Childcare/nursery....................... 120 (averages out - much dearer in school holidays that when school is running so we buy CC vouchers to budget - wife gets 5% discount so she buys them)
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 15 (I have two prescriptions per month, my wife's are free (due to medication) and my son's are free as he is 11 - I often under-medicate myself so I only need to get the prescription once every 2 months. Unpleasant (stomache pains and constant cough, but liveable with)
Pet insurance/vet bills................. 30 (oldest cat is not insured as he is 20 hence would cost far too much money - 2 x Dog; 1 x cat insured)
Buildings insurance..................... 20
Contents insurance...................... 15
Life assurance ......................... 30
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0 (we can;t put aside for these - I some extra work near Christmas to pay for these, not much so poor presents all round)
Haircuts................................ 15 (I cur my own hair and my sons, this is for my wife and daughter, evened out over the year)
Entertainment........................... 60 (my son has respite care and this allows us to have a break. I would argue this is essential due to the as this gives us a rare break from being a carer 24h (when not working))
Holiday................................. 0 - last one was on Tesco clubcard vouchers - won't be having another
Emergency fund.......................... 0 - would love one of these
Total monthly expenses.................. 2513.50


Assets
Cash.................................... 0
House value (Gross)..................... 140000
Shares and bonds........................ 2500
Car(s).................................. 0 (as under HP)
Other assets............................ 0
Total Assets............................ 142500


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 117000...(734)......7.4
Hire Purchase (HP) debt ...... 7500.....(152)......29.9
Total secured & HP debts...... 124500....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Credit Card 1..................7400......245.......35.9
Credit Card 2..................5500......120.......24.9
Credit Card 3..................3500......61........19.9
Credit Card 6..................2500......45........19.9
Loan 2.........................0.........89.1......0
Loan 1.........................19100.....494.7.....17.9
Catalogue 2....................340.......65........0
Catalogue 1....................850.......60........24.9
Store Card 2...................750.......25........29.9
Store Card 1...................1100......45........19.9
Credit Card 5..................700.......17........0
Credit Card 4..................3750......68........19.9
Total unsecured debts..........45490.....1334.8....-


Monthly Budget Summary
Total monthly income.................... 4,080
Expenses (including HP & secured debts). 2,478.5
Available for debt repayments........... 1,601.5
Monthly UNsecured debt repayments....... 1,334.8
Amount left after debt repayments....... 266.7

Personal Balance Sheet Summary
Total assets (things you own)........... 142,500
Total HP & Secured debt................. -124,500
Total Unsecured debt.................... -45,490
Net Assets.............................. -27,490

crafty*kate

Hello Geoff, welcome to the board. Good post, really thorough.

If I'm reading it right (and I'm not an expert) you should have a surplus left over each month - I guess the first question would be, do you actually have this?

geoffhodge

Thanks for the quick reply.

We don't seem to have :-) Strange (and bad month) this month though as my standby allowance didn't go through in my salary so we were £300 less than normal. Had a bit of CC space left so used that with the intention to pay that back this pay day when I get double (i.e. this months and last) although a radiator fell off the wall and it needs to be re-plastered so we can re-attach it, so maybe not all of it :-(

I'm not sure why we have no money (am planning to do a spending diary). My own calculations show that we should have about £400 surplus a month, give or take, but as we don't, I guess that either I have not included some payments or there are 'extras' we are spending (e.g. food top-ups, extra petrol and so on). I added up that without food/petrol (so all the 'fixed' payments) my salary plus £100 is gone, leaving my Wife's plus the benefits. Food is, by nature (without spending diary) a best guess based on how much a normal weekly shop is, plus how much extra we normally spend in 'top-ups', when needed.

getmore4less

AS well as finding the missing money.

have a look at snowballing

Unsecured Debts
Description....................Debt......Monthly.. .APR
Credit Card 1..................7400......245.......35.9
Credit Card 2..................5500......120.......24.9
Credit Card 3..................3500......61........19.9
Credit Card 6..................2500......45........19.9
Loan 2.........................0.........89.1......0
Loan 1.........................19100.....494.7.....17.9
Catalogue 2....................340.......65........0
Catalogue 1....................850.......60........24.9
Store Card 2...................750.......25........29.9
Store Card 1...................1100......45........19.9
Credit Card 5..................700.......17........0
Credit Card 4..................3750......68........19.9
Total unsecured debts..........45490.....1334.8....-

For that you reduce every thing to min payments and throw money at the highest rates

I would also look at cashing in the shares they are unlikely to make 35%

I would even look at putting some of the normal spend onto the lowest rate cards and use that money to hit the 35% on.


Loan 2 ?

MObiles probably could be cut using cashback but does involve remembering to make the claims.

KxMx

Have you thought of looking into DLA (Disability Living Allowance) for your son?

Toni_Broke

Hi
Assuming from your benifits amount you do receive DLA, however have you looked into whether youre eligable for a motability car? My son is also disabled, but i think it depends on if you receive the higher rate mobility component of the DLA. Worth having a look.
Good luck
Tonixx

dancingfairy

Hi - have you looked into a Prescription Prepayment Certificate? A yearly one costs about 104 and you can pay monthly so just over 10 pounds a month and then you won't have to worry about the medication costs. See here:
http://www.nhsbsa.nhs.uk/1127.aspx

Also your 2nd loan is showing as 0 owing but 89 a month min payment? what's happening there?
I think given the big surplus you are showing that you need to start a spending diary.
Best of Luck
df

RAS

Two things

Do you have any spare capacity on any of the cards except credit card 1?

I also think your wife needs to contact her union who can make anonymous contact with her HR and check out whether a DMP or similiar would affect her employablitiy; we have seen people go bankrupt with their bank employers support and keep their jobs when they sought help from the in-house debt advisors. The one who went BR and then informed his employer was out of work immediately.

geoffhodge

Sorry I didn't reply earlier but this is the first oppertunity I have had :-)

We don't have any spare card capacity at the moment but should have some (but very, very little) next week when I get paid and can pay a bit off. Loan 2 was part of the way we paid for our car - our old car died last year and this was the only way we could get a new one - being without a car isn't an option for us given our sons needs and where we live (not well served with public transport).

What's a DMP (sorry - can't place the acronym) but as she works for a bank, it will likely affect it (they do periodic credit checks to check for things like CCJs).

We did look at the prepayment option for prescriptions (now you can pay by DD so it isn't all in one go) but it worked out slightly dearer (my prescription is seasonal for one and the other I am managing to cut down) but if my meds go up, I will start one.

We do get DLA - higer rate care component and low rate mobility - we didn't get high rate (with the car) even after an appeal (we had to appeal as they downgraded us to lowest rates). We need to renew this at the end of the year so fingers crossed we will get it.

I like the snowballing idea and that looks the way to go. I did lots of number-crunching and it is possible to pay of the debts (credit card) in under 5 years (and most of the store cards); the loans, HP and catalogue will be clear by then naturally (catalogue is also interest free anyway, ends by the end of the year). This looks to be the way to go, and better than a IVA (where it would still take 5 years but be even worse for our credit file). Last time we applied for credit (for a better interest rate), we were told it was just the amount of credit we had which held us back (we have never missed any payments - late for 1 or 2 possibly, but never missed) so maybe when some credit has been cleared, we can get an interest-free balance transfer card (for a period) or low-interest rate one to shuffle balances around to pay off quicker too. Store cards can then be tackled (if those interest rates are higher, will pay those off before lower-rate CC cards)

The Shares I plan to sell to pay off some of the highest interest card (that is included in my figures above - saves 4 years). They have just dropped (as have many) this week so may wait to see if they recover again in the next few weeks (as quite a bit was lost).

Thanks for all your advice,

Geoff

Tixy

Hi

A DMP is a debt management program, used when you cannot meet minimum payments on your debts (or not without reusing the credit etc). Its usually done via a charity as a third party and its informal not legally binding, you pay the charity a set figure each month (that you can afford) and they split it between creditors. You tend to end up with defaults on your credit file but usually not CCJs etc. And when someone works in a bank the charity will sometimes agree to leave out the debts to the bank - ie you continue to make full payments to them but reduced pro-rata paynents to others.

If you can meet minimum payments and have a little over for snowballing then hopefully you shouldn't need a DMP. Providing you are keeping up with minimums, not missing payments I'd definitely hold off a little on the share sale.

That said your debts are very high but if you feel you can clear in 5years (and the snowball agrees) then hopefully it should be just about manageable for you to carry on.

Regarding groceries perhaps have a read of the grocery challenge on the old style section (always at the top of the board) for some ideas and inspiration.

Good luck.

patman99

When you start your spending diary you will begin to discover where all the money goes.
Not sure if you already use something similar, but MS Money is now free to download and use. It has the ability to assign payments and income to various catergories and produce reports based on the info you put in.