Katrina's Statement of Affairs

13katrina

Hello all,

I'm new and following the advice in many of the threads, I'm posting my statemnt of affairs - writing this wasn't nearly as bad as I thought it would be and has certainly made me feel more focussed. I suppose there is no point feeling sorry for myself and kidding myself it will get better because I know it won't, not unless I take action.

Any help and advice would be much appriciated. It's of real comfort to know I'm not alone and I'm not the only person on the planet in this position.

Income – Total: £2178.87

Earn: £899.93 pcm
T/C: £634.14 every 4 weeks (due to go down, as I have just started receiving government funding for my daughters childcare place)
C/B: £69.80 every 4 weeks
Money from my husband (we’re separated): £575

Outgoings (Direct Debits) – Total: Up to £2008.01

Autumn – my daughter’s saving account: £20.00
Abbey Mortgage – Joint with husband: £590.48
Talk Talk - Landline £ 24.34
Edf Energy – Gas/Elec £ 50.00
DGS/RPP – Washing Machine cover £ 5.00
Fareham BC – Council Tax £ 67.00
La Leisure – Gym membership (tied in until June ’07) £ 42.95
MSDW Card – Credit Card (I pay a fixed amount not min payment) £ 100.00
Northern Rock – Loan £25000 over 10 years – joint with husband) £ 323.71
Portsmouth Water £ 8.59
Prudential – Life insurance for me and husband re mortgage £ 21.54
Royal Sunalliance – Buildings and contents insurances £ 18.23
Sky – basic tv package due to increase to £15 pcm £ 7.50
Southern Water £ 19.82
Swinton Group – car insurance £ 44.31
TV Licence £ 10.99
Utility Warehouse – mobile phones * 2 – mine and my husbands £ 55.55
Childcare – varies but worst case - august 23 days @ £26 (no funding)Best case feb 28 days @ 17.70 (with funding) £ 598.00

Outgoings (Everything Else)

The difference between income and outgoings is £170.86 – this is what I live on. It pays for food and petrol. Nearly everything else that crops up ends up on the credit card.

Debts

Morgan Stanley Credit Card: £2,042.96 – I’m currently paying a fixed amount of £100 per month

Northern Rock Loan: £323.71 per month – 107 months to go – However, today’s settlement figure £23,705.20

Nursery: £546

Overdraft on Joint Account: £2000 – my husband pays in £50 pcm – this covers the charges of around £25 and is slowly starting to pay it off. We both use our own accounts mine does not have an overdraft facility and I’m not overdrawn although I have been – took me the better part of last year to sort this out. My husband has £1000 overdraft on his account and he uses it in full every month.

Note: I have just been accepted for an Egg Credit Card but unfortunately with a credit limit of £1250 – I will transfer that amount from the MS Card and pay the minimum payment of £25 and pay £75 pcm to the MS Card. I’m going to continue paying £ and continue paying

Plus the mortgage but that’s necessary.

Background
My husband and split up February 2006. At the time we thought we were not compatible but it has taking some good, honest discussion over the last year to realise that money (or rather a lack of) and way too much spending by both of us (after all we deserve this, that and the other – we work hard, why shouldn’t we have it, duh, we can’t afford – so simple, yet so hard).

I can say that our relationship is well and truly back on track but we have a big problem – we can’t actually afford to live together – he’s still living with his parents (he only has to pay £50 per month keep – so really his parents are pretty much keeping him for free).

He gives me £575 pcm – this did cover the mortgage until the interest went up. He pays £50 pcm into the joint account, £50 keep to his parents plus around £75 every month for train fairs (although I believe he buys a monthly pass). He earns £1100 a month after tax, so has about £350 spare - he has been using to pay off his own debts. On a brighter note – these will all be paid by April’s pay day and some months he’ll probably have some left over – this is because all of his debts are 0% buy now pay later deals – so he has fixed amounts due on certain dates to avoid interest. However, May and Junes pay will go straight to my mother who we’re going on holiday with in September – she paid for the holiday and we owe her – no getting out of that one (she just bought me a little run around with a years mot and tax – she’s fantastic but I can’t take the !!!!). Obviously, if he moved back in my tax credits would be re-assed and would go down dramatically – although I’d be better off, I think to the tune of £100-150 per month – he’d no longer have £350 ‘spare’. At the very least he can’t move back in until his debts and the holiday are paid.

Last month my husband sold his motorbike and gave me £2000 – I paid every last penny off of lots of silly debts plus one other credit card – American Express, Littlewoods, Next, Studio, VivaLaDiva etc and closed all of the accounts. I know with the exception of the credit card, a lot of these types of debts are interest free but all of the monthly payments were killing me and paying them off left me with just the debts mentioned above.

Our discounted mortgage period ends on 17th June 2007. We were going to re-mortgage and add our loan to it – this would obviously make the mortgage a lot larger and the payment would be higher but on a monthly, day-to-day basis we would be better off. We’d paying out around £750 per month (over 35 years) rather than £914 per month. However, I gather from everything I’ve already read on this site and forum this is not the way to go. We’d obviously rather just pay out £590 for the mortgage and have no loan at all.

Sorry to ramble on and on; but more than anything we want to be living together, not just for us but also for our daughter who turned three last November. We’d love to have another baby and I want to retrain as a midwife but these things are only ever going to be dreams, unless we sort this mess out.

Thanks in advance, to anyone who takes the time to read and respond to my post.

anniestar

Welcome and good luck for starting to get everything sorted out. There will be lots of wiser and more knowledgable folks along shortly, but a couple of things spring to mind. Firstly the £20 in savings for your daughter, Talk Talk landline seems expensive. Could you live without Sky in the short term and finally the mobile phone bills, any chance of getting PAYG. Anyway you are doing the right thing in getting sorted. I wish you(and your DH) well, lets hope that you will be soon back together as a family and looking forward to the patter of tiny feet. Good luck.

moozie_2

Hello Katrina and welcome

You have clearly been paying attention as you have already taken great steps to improve your situation! Well done on paying all of that £2,000 off your debts, bet you feel a lot better for it now.

Here are my thoughts on your figures

13katrina wrote:

Income – Total: £2178.87

Earn: £899.93 pcm
T/C: £634.14 every 4 weeks (due to go down, as I have just started receiving government funding for my daughters childcare place)
C/B: £69.80 every 4 weeks
Money from my husband (we’re separated): £575

Outgoings (Direct Debits) – Total: Up to £2008.01

Autumn – my daughter’s saving account: £20.00
Abbey Mortgage – Joint with husband: £590.48
Talk Talk - Landline £ 24.34 Does this include broadband?
Edf Energy – Gas/Elec £ 50.00 Is this the cheapest deal for you? I don't know the size of your property etc but try uswitch.com for comparisons and turn down radiators/thermostat, extra jumpers etc
DGS/RPP – Washing Machine cover £ 5.00 Is this really necessary? Have you ever claimed on it?
Fareham BC – Council Tax £ 67.00 I presume you are claiming the single persons discount?
La Leisure – Gym membership (tied in until June ’07) £ 42.95 I can see you can't cancel it before June but can you reduce it perhaps?
MSDW Card – Credit Card (I pay a fixed amount not min payment) £ 100.00
Northern Rock – Loan £25000 over 10 years – joint with husband) £ 323.71
Portsmouth Water £ 8.59
Prudential – Life insurance for me and husband re mortgage £ 21.54
Royal Sunalliance – Buildings and contents insurances £ 18.23
Sky – basic tv package due to increase to £15 pcm £ 7.50 When can you cancel this and move to freeview?

Southern Water £ 19.82
Swinton Group – car insurance £ 44.31 This is high. Is it your area or have you had claims?
TV Licence £ 10.99
Utility Warehouse – mobile phones * 2 – mine and my husbands £ 55.55 You can cut down on those without much effort
Childcare – varies but worst case - august 23 days @ £26 (no funding)Best case feb 28 days @ 17.70 (with funding) £ 598.00

Outgoings (Everything Else)

The difference between income and outgoings is £170.86 – this is what I live on. It pays for food and petrol. Nearly everything else that crops up ends up on the credit card.

Debts

Morgan Stanley Credit Card: £2,042.96 – I’m currently paying a fixed amount of £100 per month

Northern Rock Loan: £323.71 per month – 107 months to go – However, today’s settlement figure £23,705.20

Nursery: £546

Overdraft on Joint Account: £2000 – my husband pays in £50 pcm – this covers the charges of around £25 and is slowly starting to pay it off. We both use our own accounts mine does not have an overdraft facility and I’m not overdrawn although I have been – took me the better part of last year to sort this out. My husband has £1000 overdraft on his account and he uses it in full every month. Have you thought of getting an Alliance and Leicester account for these ODs? 0% interest guaranteed for a year which will help greatly!

Note: I have just been accepted for an Egg Credit Card but unfortunately with a credit limit of £1250 – I will transfer that amount from the MS Card and pay the minimum payment of £25 and pay £75 pcm to the MS Card. I’m going to continue paying £ and continue paying Good thinking! Chuck everything at the M&S and then pay off the Egg.

Plus the mortgage but that’s necessary.
.

Thank you for the very clear post. I can see you are in a difficult situation but you know you are only in it temporarily!

I think £170 for one adult and child is challenging each month but you must cut up the cards and not use them again. While you are adding to the debt, you are delaying getting out of it.

Try to cut down your bills as much as possible. Ebay/Amazon anything and everything and start doing regular mystery shopping - grass roots pay well - as well as surveys online,. cashback etc. Anything to boost your income will help.

Edit: Forgot to say that if you add a loan to your mortgage it will cost a lot more than if you pay these debts off as they are. Also, why would you want to turn unsecured debt into secured? Best not to!
Good luck!

13katrina

Okay - have started actioning some of the advice in the above posts.

My daughter's saving account: Have cancelled dd for now.

Landline: My landline doesn't include broadband (I don't have any internet connection at home) - that price is for line rental and talk 2 that gives me free evening and weekend calls.

Gas/elec: Not sure about gas and electric - changed to edf last August, so should be quite a good deal. I have a 3 bed, mid-terrace. Have been making every effort to save electric/gas. Rarely use tumble-dryer, energy saving bulbs everywhere, switching off lights, nothing on stand-by etc, etc. Only my heating/water is gas but unfortunately the boiler is older than time itself. However, I have applied for a grant to have it replaced. I'm entitled as my income is below a certain amount and I get working and child tax credits.

Washing machine cover: Have cancelled washing machine cover.

Council Tax: I am claiming single-person discount on the council tax.

Sky: Not sure I want to cancel my Sky package - it is the cheapest package they have and nearly everything I watch is on Sky1 and if I'm cutting out every other luxury, I feel this is the one thing I can't do without. I do phone regularly to cancel when they put the price back up to £15 and they always reduce it back to £7.50.

Car Insurance: My car insurance is high - no claims just had a really expensive car (belonged to my Dad) but I've now handed this back to him and now have an old, small 1.1. My insurance is due next month and they don't think it will be more than £150 fully comp but the car isn't worth much so will only go 3rd party, fire and theft to save some money.

Mobile Phone: Have checked with mobile phone company and I'm not in a minimum contract. I think I'm probably better off moving to PAYG. I have a good, reliable handset so I just need to buy a PAYG sim card. Can anyone recommend a good provider/tariff. Use the text quite a lot, so cheap/free texts would be good.

Other: Have started sorting out my ebay pile and will do a budget to manage my £170 well. Have cut up the credit card - made me feel better but also made me nervous - have to live on that £170 now, no other choice. Will divert the extra savings from above to the m&s credit card.

Thanks for the ideas, so far. Any others much appreciated.

This forum is a really great idea but strange to think that strangers now know more about my problems than my family (apart from my mum - we had a long chat last night for about two hours - we both cried but it was quite good to finally admit I had a problem and I needed some support) and closest friends.

lynzpower

Landline: My landline doesn't include broadband (I don't have any internet connection at home) - that price is for line rental and talk 2 that gives me free evening and weekend calls.

Are you tied into this?

Only I get our landline through BT, then I have primus 2 which is FREE and gives free evening & weekend calls, although you have to pay the day calls obviously.

So for the same package as youve got I pay about 11 a month for the LL.

uwitch has this pacjkage so go through quidco- uswitch- primus 2, to get 15 cash for "switching"

unless your tied in that is!

pollyanna24

Not much help, but make sure you are claiming your Nectar points on EDF Energy.

Bestthingsinlifearefree

Hi K,

welcome to MSE. Diong the SOA is a great first step.

what interest rate is the Credit card ? Could you transfer this debt to a zero or low interest rate credit card ?

Gym need to go in June if not before.

Best,

irishmanc

Hi there,

Have you thought of ebaying/amazoning some books/cds/unwanted gifts? I've just started myself and have made about £30/40 just on books and a monoploy set. Try it and see!

x

tryhard_2

13katrina wrote:

Talk Talk - Landline £ 24.34
Childcare – varies but worst case - august 23 days @ £26 (no funding)Best case feb 28 days @ 17.70 (with funding) £ 598.00

Hi and welcome
phone - you can get a basic landline package BT option1 £11 pm and then make your calls using 1899 or 18185 - for UK landline calls it is 0 p/min only a connection charge of 4 p per call. if you make loads of calls it is worth getting primus otherwise it is cheaper to get 1899 or 18185.

Have you looked into getting busybee vouchers for childcare?

is your water on meter? might work out cheaper - you can call up the company and they will give you an estimate

good luck!!

Sally14

"Talk Talk - Landline £ 24.34


Landline: My landline doesn't include broadband (I don't have any internet connection at home) - that price is for line rental and talk 2 that gives me free evening and weekend calls."

Hi,
I'm on that same tarriff but only pay £11 per month

benood

13katrina wrote:

Obviously, if he moved back in my tax credits would be re-assed and would go down dramatically – although I’d be better off, I think to the tune of £100-150 per month – he’d no longer have £350 ‘spare’. At the very least he can’t move back in until his debts and the holiday are paid.

; but more than anything we want to be living together, not just for us but also for our daughter who turned three last November. We’d love to have another baby and I want to retrain as a midwife but these things are only ever going to be dreams, unless we sort this mess out.

Just stumbled over your post Katrina, good luck by the way I'm sure you'll get lots of good advice here. It shocked me when I saw your post above that due to how tax credits work you couldn't afford to move back in with your husband this seems absolutely bananas - and presumably it's a situation lots of people find themselves in!:mad: