payplan or snowball?

kathfisch

Congrats on getting all the info together and being determined to clear your debts! Some things that spring to mind from your expenditure:

jackied wrote:

Wages £950.00 What is this?
Sons board £120.00
Sons Insurance £53.00 For this and all other insurance - are you getting the best deal. You can buy through quidco and get significant amounts of cashback with lots of companies.
Loan to mum £110.00 Could this be reduced or stopped until you're in a better position? Depends what the situation is, obviously.
Powergen £75.00 Again, check you're with the cheapest supplier.
House insurance £15.54
poll tax £80.00
Tv licence £10.49
car insurance £86.66 Per month for just one car? seems high.
Car payments £80.00
Phone/ broadband £28.00
Mobile £20.00
Marshall ward £67.53
Halifax card £33.73 owe £1,700
Barclaycard £15.98 owe £639
Westcott £42.50 owe £900
Mackenzie £10.00 owe £2,850
Bucannon £30.00 owe £1,310

Lottery £16.00 You won't win and that money would be better spent on your debts, sorry to be blunt.
Shopping £160.00
Cigarettes £30.00 Can you consider quitting, or cutting down, or smoking roll-ups?
Going out £60.00
Clothes £20.00

Annual Expediture
Christmas and birthdays £420.00 Monthly £35.00
Mot £50.00 Monthly £4.17
Hair cuts £60.00 Monthly £5.00
Car tax £110.00 Monthly £9.17
Summer holiday £780.00 Monthly £65.00 A summer holiday at that price is a luxury really, can you make it cheaper?

Total Incoming £1,123.00
Total outgoing £1,109.76

Leaves £13.24

I have changed my payments to reflect what i will be paying if i use the snowball, at present i pay the minimum payments on all but will be changing that of this month So do you mean that those payments are more than the minimums, on the highest apr one at least?

If I structure it like this:

Total Incoming £1,123.00

Wages £950.00 Is this your wages in, or something you have to pay? I'm assuming its not an expense for now.

Sons board £120.00
Sons Insurance £53.00
Loan to mum £110.00
Powergen £75.00
House insurance £15.54
poll tax £80.00
Tv licence £10.49
car insurance £86.66
Car payments £80.00
Phone/ broadband £28.00
Mobile £20.00
Lottery £16.00
Shopping £160.00
Cigarettes £30.00
Going out £60.00
Clothes £20.00
Christmas and birthdays £35.00
Mot £4.17
Hair cuts £5.00
Car tax £9.17
Summer holiday £65.00

Total outgoings = £1083.09

That leaves £39.91 for debt repayment, but you've calculated in a lot more than that? Are some of the items at the top of the list incomings rather than outgoings? Or is my maths just shocking today?! :rotfl:

You need get a figure of how much is left when reasonable living expenses are taken into account. Maybe not the standard you are used to but not too harsh either as you need to be able to keep at it!

Then... if there is enough to meet your minimum repayments (and hopefully more!) you can use the snowball approach - making as many cut-backs as possible to increase the amount you can pay and reduce the time it will take to clear the debts.

If there is not enough left to make even minimum repayments, then to my mind you are in a crisis that requires a debt management plan. This will basically aim to reduce/stop interest and charges and allow small payments to be made, but you would be issued with defaults and the effect on your credit rating is substantial.

Hope some of that helps!

Kath

kathfisch

Oh, actually, your debt to your mum really shouldn't be in the expenses. So that would make outgoings £973.09, leaving £149.91 to pay off debts, but then the debt to her is included in that.

Ahh, i see you've edited the incomings and outgoings bit! That's clearer!

Time to redo the maths...

jackied_3

Hi linda :hello: thank you for the welcome

I have just used uswitch to get a better deal on my gas and electric so when the switch is sorted i will save £10 a month on that

My car insurance is due in july so going to use the tips from here and also from martins book (which i have just brought) to find a better deal if possible on that

Also have put some stuff on Amazon so far only made £15 but its a start.

Been talking this over with my boyfriend this morning to make sure he understands that i am serious about this and if i cant afford to go out then i wont be he said he will pay for the whole night if we go out more than i can afford

I feel quite positive about this and as i said before its not to do with not having enough money to pay all my bills its about wanting a little left over for the nice things in life and for the past 3 years it seems all i do is work and pay bills it can get you to point where you just dont want to tackle them so you leave them and thats when things like credit cards get you in more debt.
I feel quite hopeful that i can sort this out once and for all and from then on my motto will be ... if i cant afford it i dont have it

kathfisch

Wages £950.00
Sons board £120.00
Sons Insurance £53.00
Total Incoming £1,123.00

Powergen £75.00
House insurance £15.54
poll tax £80.00
Tv licence £10.49
car insurance £86.66
Car payments £80.00
Phone/ broadband £28.00
Mobile £20.00
Lottery £16.00
Shopping £160.00
Cigarettes £30.00
Going out £60.00
Clothes £20.00
Christmas and birthdays £35.00
Mot £4.17
Hair cuts £5.00
Car tax £9.17
Summer holiday £65.00

Total outgoings = £973.09

Remaining = £149.91

Loan to mum £110.00
Marshall ward £67.53
Halifax card £33.73
Barclaycard £15.98
Westcott £42.50
Mackenzie £10.00
Bucannon £30.00

Repayments total = £309.74 so that's more than you have left over! Are these the minimum payments?

jackied_3

Hi katfisch thanks for the advice to answer your questions

The car insurance was only £30 but then my 18 year old son passed his test and was included on my insurance, this bumped it up a lot but he pays £53 towards it so it still really only costs me the £30. I added the whole figure in as i also added it into my income

I already smoke roll ups, i spend £10 a fortnight on one packet and also buy a packet of 'real' cigs when i go out which is why i put it down at £30. I used to smoke 'real' cigs all the time and this was costing me upwards of £35.00 a week so this is drastically reduced already

Lottery yes i see your point, i will cancel this

The payments on the halifax, barclaycard and marshall ward are all higher than the minimum as this is what the snowball has told me to pay off so i have upped the amount as of this month.

The loan with mum is a tricky one, my mum didnt actually lend me the money she went to the bank and got a loan out for me, i dont want to touch this one at all as it is in her name and her credit will be affected if i mess with it. I count this one as one that has to be paid no matter what.

THanks again

jackied_3

ummm have i made a mistake or two lol let me go have a look as i did it all in excell and it added it up for me, strange brb

kevster1009

Jackie...you do NOT need to wait until renewal date to insure your car with someone cheaper. go thru Quidco to Swiftcover, I just did for 2 cars, save myslef over £200 per car and you get £26 back for each one in 3months time too.

kathfisch

Hi Jackie, I understand about the loan that your mum took out, you don't want to affect her credit rating. If you enter a DMP though, you are expected to treat all creditors equally, i.e. if you only have enough to pay 75% of minimum payments (for example) then you are expected to pay each creditor 75% of the amount they require, rather than 100% to some and less to others, if you see what I mean? Don't think it applies to council tax though cos that's a priority one. I don't know if this would apply to your mum's loan too but its worth bearing in mind. DMP companies can cancel their handling of your case if they find out that you have not declared all debts to them, so this is not an option.

Go through those figures again and see what you get

jackied_3

I have made a couple of changes since you took your copy from my list!!!! sorry that could be why, ill update first post to reflect this amount and hope that im right this time, (hangs head in shame)


Income
Wages £950.00
Sons board £120.00
Sons Insurance £53.00
Total incoming £1123.00

Outgoings

Powergen £75.00
House insurance £15.54
poll tax £80.00
Tv licence £10.49
car insurance £86.66
Car payments £80.00
Phone/ broadband £28.00
Mobile £20.00
Lottery £16.00
Shopping £150.00
Cigarettes £30.00
Going out £50.00
Clothes £20.00
Petrol £30.00

Total £691.69


Marshall ward £67.53
Halifax card £33.73 owe £1,700
Barclaycard £15.98 owe £639
Westcott £42.50 owe £900
Mackenzie £10.00 owe £2,850
Bucannon £30.00 owe £1,310
Loan to mum £110.00
Total debts £309.94

Annual Expediture
Christmas and birthdays £420.00 Monthly £35.00
Mot £50.00 Monthly £4.17
Hair cuts £60.00 Monthly £5.00
Car tax £110.00 Monthly £9.17
Summer holiday £780.00 Monthly £65.00
Need to save £118.00 per month for these above

Total outgoing £1119.63

Leaves £3.37

jackied_3

if this would affect my mums loan then i would not go for it. I think the answer for me is the snowball, that will still see me free of debt within 3 years and also will not affect the credit cards etc that i have at the moment even though they will be in the bin anyway as i wont get caught again.

According to the snowball i can save £750 in interest paying them all off this way and any extra cash i make along the way i thought i would just add extra on to their amounts to do it quicker still!