In a bit of a pickle................

money_is_my_enemy

Hello All

I have got myself in a bit of a pickle and need help. please be nice I have been lurking before but this is my first post.

Due to difficulties my husband and I have had to move in with my mother (loss of home, not money related), whilst we are here we need to clear as much of our debt as possible to enable us to move out in 6-9 months time (the time limit agreed by us and my mum). Here is the problem :eek::eek::eek::eek:...........................

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1142
Partners monthly income after tax....... 1300
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2442

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 100
Management charge (leasehold property).. 0
Council tax............................. 152
Electricity............................. 30
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 80
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 400
Clothing................................ 20
Petrol/diesel........................... 150
Road tax................................ 20
Car Insurance........................... 40
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 14
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 20
Entertainment........................... 30
Holiday................................. 300
Emergency fund.......................... 0
House Saving............................ 300
Storage................................. 80
Account Fee ............................ 12.95
Total monthly expenses.................. 1788.95


Assets
Cash.................................... 888
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 2388

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Halifax .......................376.86....20........16.9
Vanquis - Hubby................2500......150.......29.9
Vanquis - Me...................2500......150.......29.9
Capital One....................198.4.....20........34.9
SimplyBe.......................183.16....20........39.6
HSBC Loan - Inc. APR...........6725.14...217.......0
HSBC Loan - Inc. APR...........15896.....264.9.....0
Total unsecured debts..........28379.56..841.9.....-


Monthly Budget Summary
Total monthly income.................... 2,442
Expenses (including HP & secured debts). 1,788.95
Available for debt repayments........... 653.05
Monthly UNsecured debt repayments....... 841.9
Amount short for making debt repayments. -188.85

Personal Balance Sheet Summary
Total assets (things you own)........... 2,388
Total HP & Secured debt................. -0
Total Unsecured debt.................... -28,379.56
Net Assets.............................. -25,991.56

I know there are things you are going to pick up on.....
1) Holiday Money - If we cancel this now we will loose all the money we have put in and the other people will also not be able to go. I am unable to sell my share because of who we are going with and where we are staying.
2) The council tax is arrears on the old place - Only 3 payments left.
3) Food Bill - Astronomical for 2 adults.
4) The HSBC loans do not have APR as that is calculated into the final total and the amounts paid are non negotable.
5) Mobile phones - Both stupidly in iphone contracts and cant lower (grrr) next time PAYG!
6) The house saving is for a months rent and deposit when we do move.

I would love to get rid of as much of the debt as possible before we move out although I am fully aware the 2 HSBC loans we will be taking with us.

As you can see my mum is being very very kind to help get us back on our feet and I want to make sure I leave here as fully cleared up as possible.

What improvements can I make??? Please help me.

NorthernLas

It would help if you kept a spending diary - you will know exactly what you spend and you can ask yourself before you spend do you really need it?

From your SOA you cannot meet your debt repayments, so saving £300 for the house doesn't seem practical until you have paid off the council tax. How much more do you pay for the holiday - because once it is paid you could switch that to a buffer fund for the rent.

Would using a series of jars with cash in work ... so once it's gone it's gone? Is OH on board?

You also need to look at the snowball calculator as I would have thought it is better to pay minimum for all and throw the rest at the card with the highest interest i.e. Simply be

Tixy

Hi and welcome

I'm sure its not easy living back with mother by hopefully it will help you be able to pay down your debts and great that you had the option.

Okay so first there is a £189 shortfall to be found as a priority, then anything else is a bonus.

money_is_my_enemy wrote: »

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1142
Partners monthly income after tax....... 1300
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2442

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 100
Management charge (leasehold property).. 0
Council tax............................. 152 once this is paid off that will be a big help, so good that its only 3months
Electricity............................. 30 is this old place or contribution to mum?
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 80 how long left on the contracts? definitely no way to lower? have you phoned up and grovelled?
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 400 Wow. I know you know this but wow, you simply have to cut this right down. You should easily be able to halve. Do you know why its so high - any particular weaknesses? does it include cigs or quite a bit on drink etc? Have you an action plan to change this and reduce. Set a £300 budget for next month as an absolute max.
Clothing................................ 20
Petrol/diesel........................... 150 presumably this is mostly commuting? do you try to drive efficently, always fill up at the cheapest place etc?
Road tax................................ 20
Car Insurance........................... 40
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 14
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 20
Entertainment........................... 30
Holiday................................. 300 when is the holiday? how many more months of saving? how much paid so far?
Emergency fund.......................... 0
House Saving............................ 300 this needs to wait until at least the ctax arrears are paid off, and prefereably until a couple of debts are paid off.
Storage................................. 80
Account Fee ............................ 12.95
Total monthly expenses.................. 1788.95


Assets
Cash.................................... 888
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 2388

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
SimplyBe.......................183.16....20........39.6 set yourself a target to pay this off this month. No point putting £300 into savings with this debt.
Capital One....................198.4.....20........34.9 this is second, pay this off in full next month.
Vanquis - Hubby................2500......150.......29.9 once the top 2 are gone you need to throw all you can at this.
Vanquis - Me...................2500......150.......29.9
Halifax .......................376.86....20........16.9
HSBC Loan - Inc. APR...........6725.14...217.......0
HSBC Loan - Inc. APR...........15896.....264.9.....0
Total unsecured debts..........28379.56..841.9.....-


Monthly Budget Summary
Total monthly income.................... 2,442
Expenses (including HP & secured debts). 1,788.95
Available for debt repayments........... 653.05
Monthly UNsecured debt repayments....... 841.9
Amount short for making debt repayments. -188.85

Personal Balance Sheet Summary
Total assets (things you own)........... 2,388
Total HP & Secured debt................. -0
Total Unsecured debt.................... -28,379.56
Net Assets.............................. -25,991.56

I know there are things you are going to pick up on.....
1) Holiday Money - If we cancel this now we will loose all the money we have put in and the other people will also not be able to go. I am unable to sell my share because of who we are going with and where we are staying.
2) The council tax is arrears on the old place - Only 3 payments left.
3) Food Bill - Astronomical for 2 adults.
4) The HSBC loans do not have APR as that is calculated into the final total and the amounts paid are non negotable.
5) Mobile phones - Both stupidly in iphone contracts and cant lower (grrr) next time PAYG!
6) The house saving is for a months rent and deposit when we do move. I know you want to save this, but you must focus on those more expensive debts first.

Right what do you think you can get the grocery budget down to realistically?
First I would work out a snowball to see how much you will have paid off in 9months if you try to cut this down, pay off ctax and then focus on clearing the debts and if you try to make the £300 a month savings for a house.
I would consider whether it would be an option to stay a little longer as I suspect with the holiday and the rent/deposit savings both going out each month that you won't have cleared all your high interest cards in 9months.

Edit
I looked at a snowball assuming that you would have to £1006 a month to pay off the debt including the council tax) -£653 you already have, £200 from halving groceries and 152 re the council tax. If you pay this off for 9months (and so keep the £300 savings & £300 holiday) then by the end of May 12 (9months), you will have paid off the ctax, the simplybe and capital one and 1 vanquis card, but still owe £2022 on the second vanquis card, plus £340 on halifax and obviously still have the 2 HSBC loans ongoing.
If you could live with mum a further 3months then you could also clear the second vanquis down to around £500. Which would seem to be a much better position to start from in a new house.

As an aside how much do you need for rent and a deposit - if you save £300 for 9months thats £2700 - will you really need that much? Could you not drop them to £200 a month (or better still wait a few months before you start making the savings. Maybe start them after xmas for example.

getmore4less

Amount short for making debt repayments. -188.85

The current SOA does not ballance so the savings(for house holiday) are not going to happen.

It has to ballance and be realisitic.

Cash.................................... 888
Capital One....................198.4.....20........34.9
SimplyBe.......................183.16....20....... .39.6

Pay these off immediately.
£20 for nine months replaces the savings(if you find the other -£189 somewhere else

Then phone them up for a deal.

Cancell if the deal is no good or use for cash flow(pay off in full every month) to reduce the costs on other cards.

What's the limits on each card there may be room to shuffle debt to a lower rate


Whats in the food? Does it include mum?
Seperate out non essentials like booze.

foxgloves

Agree with previous posts about your food budget. There are 2 of us & we budget £250 a month for food. This includes cleaning/household stuff, cat food & some toiletries. We can manage on £200 if we have to, & still eat well. You do need to cook from scratch more, batch cook & shop around (i.e all our friut & veg turned out to be much cheaper on the local market). Above all, you need to PLAN. Before you make a shopping list, make a meal plan. Decided what you're going to eat for your main meal every day that week, how much stuff you'll need for lunches/packed lunches for work, etc, & check you have enough food for 7 days of breakfasts. The Old-style forum has loads of ideas for saving money in this area. Try cutting to £300 for the first month then £250 and bear in mind that if you can't buy it from the budget you've allocated, then you need to choose something else. I think once you get into the habit of doing this, you'll really see that a £400 a month spend for food for 2 people is a luxury you can't afford. If you aim for £250, just think how useful that spare £150 a month would be! That's £1600 a year. No-one would refuse a sum like that if it was offered to them! Good luck with it all x

money_is_my_enemy

Hi All

Thank you so much for taking the time to reply. Having had the chance to have a conversation with the hubby we have decided to do the following:

Food - We have set ourselves a budget of £250 for the next 4 weeks (we get paid 4 weekly) its no excuse but the I think we have previously spent so much because we often work separate shifts and thus find it difficult to plan but I think with careful precision and some dedication this is very much achievable. We are both also eating lunches bought from the bakers when I can make the same at home for much less. This alone nearly covers all the shortfall.

Petrol - Hubby is using the iphone we cant get rid of just yet to get an app for the cheapest fuel places around, plus moving into mums gives us better rail links (which we get free) and he should only have to use the car 7 days out of 21 for commuting so that should really help too.

House Saving - We have decided to cut this right back to only £100 I cant get rid of it completely.

We had some extra pay this month (pay day today) too so we have managed to clear the Simplybe Debt and pay £100 off the Capital One card.

dell33

well done to you, great step forward.

beanielou

Good news on simplyBe and reduction on Cap One ~great start :j
Well done on trying to reduce food bill.

getmore4less

II you have £800 in cash pay off the capital one there is no point paying 35% interest when you have savings earning peanuts.

Then you can focus on Vanquis.

Delay the house saving and it makes 30% interest rate


Seperate out your grocery spending to home and away

Anything bought not out of home budget for lunches takeaways etc needs to be tracked seperately.

chasing fuel prices is often not worth extra miles just track the prices of places on normal routes and fill up at the cheapest of those.