Weighed Down by Debt

mabbya

Hi all,

Joined the team a few days ago. Really weighed down by debt, can't seem to think of anything else! OH is not really that bothered. I thought we were managing monthly payments until I did an "SOA"! The stark reality!

Please help! See SOA below:



Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 3
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 3085
Partners monthly income after tax....... 1250
Benefits................................ 188
Other income............................ 0
Total monthly income.................... 4523
Monthly Expense Details
Mortgage................................ 968
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 121
Electricity............................. 51
Gas..................................... 91
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 12
Mobile phone............................ 50
TV Licence.............................. 12.5
Satellite/Cable TV...................... 47
Internet Services....................... 12
Groceries etc. ......................... 500
Clothing................................ 50
Petrol/diesel........................... 80
Road tax................................ 25
Car Insurance........................... 45
Car maintenance (including MOT)......... 50
Car parking............................. 5
Other travel............................ 103
Childcare/nursery....................... 50
Other child related expenses............ 300
Medical (prescriptions, dentist etc).... 20
Pet insurance/vet bills................. 0
Buildings insurance..................... 44.5
Contents insurance...................... 0
Life assurance ......................... 15
Other insurance......................... 0
Presents (birthday, christmas etc)...... 50
Haircuts................................ 100
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
association............................. 10
professional subscriptions.............. 20
child trust fund........................ 57.5
swimming lessons........................ 50
homecare 400............................ 43
homecare assist......................... 3
donation................................ 40
family.................................. 45
lebara.................................. 20
Total monthly expenses.................. 3120.5

Assets
Cash.................................... 0
House value (Gross)..................... 250000
Shares and bonds........................ 100
Car(s).................................. 1000
Other assets............................ 0
Total Assets............................ 251100

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 188000...(968)......2.89
Total secured & HP debts...... 188000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
halifax loan...................5379.43...145.......12.04
sainsbury loan.................5549......149.......0
m & s loan.....................2472......224.......6.6
argos card.....................34........34........0
virgin credit card.............2100......160.......0
barclaycard mc 1...............4726......108.......0
barclaycard visa...............11475.....263.......0
halifax cc.....................7716......85........6.9
personal.......................2580......100.......0
halifax overdraft..............2000......31........0
barclays overdraft.............2550......33........0
sainsbury cc...................1700......50........6.9
g e capital....................3500......95........19.56
barclaycard mc 2...............2600......105.......0
Total unsecured debts..........54381.43..1582......-

Monthly Budget Summary
Total monthly income.................... 4,523
Expenses (including HP & secured debts). 3,120.5
Available for debt repayments........... 1,402.5
Monthly UNsecured debt repayments....... 1,582
Amount short for making debt repayments. -179.5
Personal Balance Sheet Summary
Total assets (things you own)........... 251,100
Total HP & Secured debt................. -188,000
Total Unsecured debt.................... -54,381.43
Net Assets.............................. 8,718.57

RAS

CAN OH earn more? And are those cards really all on 0% deals?

Will skin that SOA becasue you need it. If the mortgage rate goes up, you are shot.

Is GE Capital a loan? And early redemption penalty?

BitterAndTwisted

You have FIFTY-FOUR THOUSAND POUNDS of unsecured debt and your partner isn't bothered? Until they are you really aren't going to get anywhere at all, except the hurtle towards bankruptcy.

Print off the SOA and show it to your OH and quickly.

Purple_Sunshine

The main suggestions I have for you are as follows:

Do you really need satellite tv? £47 a month could be better spent and Freeview is adequate

Could you cut down your mobile bill? Maybe call your provider and see if there's a better deal for you

£500 on groceries does seem high, could you try maybe buying a brand level lower (ie supermarket own brand rather than the big brands), and maybe do a meal planner for a week and set a budget.

Could you find a cheaper hairdresser?

Could the £40 donation be stopped whilst you are in this situation?

Maybe check online on MoneySupermarket or similar to see if you could pay less for your Gas/Electricity.

Hope this helps a bit, I am also trying to cut back on my spending and trying to find cheaper ways for everything!

Good Luck

superted187

Welcome

Can I ask how you managed to accumulate such large unsecured debts?

Get organised NOW and start with hammering down that grocery bill. Cook large meals in bulk and make lunches at home. Cancel the Sky subscription, sort your mobile contract out and get your hair cut less. I'd also suggest cutting the amount you pat into your child trust funds. Although it would be a nice thing to do, you should stop temporarily and restart once you've got your debt under control.

Hammering your grocery bill down will be easy just as long as you get organised (make your work lunch the night before).

mabbya

RAS wrote: »

CAN OH earn more? And are those cards really all on 0% deals?

Will skin that SOA becasue you need it. If the mortgage rate goes up, you are shot.

Is GE Capital a loan? And early redemption penalty?

I have discussed with OH and fingers crossed will get a bit more in this month.

Most of the credit cards are on a fixed interest rate for the life of the loan.

Virgin credit card is on normal rate but I am paying three times the minimum payment.

GE Capital loan was finance for a new boiler. I would like to move this to cheaper rate but can't get loans and not sure how to transfer with credit card

Bored

You need to tackle the source of these debts. For example, were they large purchases for cars, home improvements, repairs, or have they accumulated as a result of continual overspending and consolidation? If the latter then you need to ensure you know exactly how much is coming and going from your account with a spending diary. This is the only way you can really see where all your hard earned cash is going, and you can then start to cut down any frivolous spending which we don't tend to notice (i.e work lunches, coffees, eating out, newspapers).

From looking at your SOA, the immediate things that stick out as having potential to cut back are groceries, satellite tv, presents, haircuts and donations.

GreenSaints

Firstly, well done for taking the first step to a DF life Secondly, my BF is not bothered about money either - he says it "borws" him!?! So I understand the difficulties in trying to get him to understand.

I totally advocate a meal planner. I used to spend £90 on the two of us and a cat! It's now down to £50 and I haven't cut out the things I like - I just plan better. I still want to get it down though.

Take a look at theresourcefulcook.co.uk There are meal plans for the number of people you have, the type of food, budget and it even provides you with a shopping list at the end! Take a look at the Old Style money boards too for recipes and ideas.

Good luck

mabbya

Purple_Sunshine wrote: »

The main suggestions I have for you are as follows:

Do you really need satellite tv? £47 a month could be better spent and Freeview is adequate

Could you cut down your mobile bill? Maybe call your provider and see if there's a better deal for you

£500 on groceries does seem high, could you try maybe buying a brand level lower (ie supermarket own brand rather than the big brands), and maybe do a meal planner for a week and set a budget

Could the £40 donation be stopped whilst you are in this situation?


Maybe check online on MoneySupermarket or similar to see if you could pay less for your Gas/Electricity.

Hope this helps a bit, I am also trying to cut back on my spending and trying to find cheaper ways for everything!

Good Luck

Thanks for quick response:


I'll have WWIII on my hands if i cancel sky. I recently got a one stop package that includes broadband, tv and phone so making some savings compared to previous bill.

£500 grocery bill also includes, £100 pocket money for me and £100 for kids miscellaneous school and home demands. So really only £300 for groceries

Mobile phone is £45 for my contract which is up for renewal soon and £5 contract for OH

The £40 donation is for religious reasons. I need to pluck the courag e to do that

RAS

The basic expenditure to income looks OK, so how have you managed to rack up that much debt? Unless you understand that, you have no chance of sorting out the situation.

Generally debt equal to one year's salary is manegeable; beyond that things get problematic.

mabbya wrote: »

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 3
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 3085
Partners monthly income after tax....... 1250
Benefits................................ 188
Other income............................ 0
Total monthly income.................... 4523
Monthly Expense Details
Mortgage................................ 968 - repayment or interest only?
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 121
Electricity............................. 51
Gas..................................... 91 - this is very high, combined with the electricity above. Search for better deals and learn to wear sweaters in the house. Als use energy saving lamps and switch off everything except the fridge and freezer unless you are using it.
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 12
Mobile phone............................ 50 - this needs to be reduce as soon as you can downgreade your packages.
TV Licence.............................. 12.5
Satellite/Cable TV...................... 47 - get rid - you cannot afford it
Internet Services....................... 12
Groceries etc. ......................... 500 - this is silly. £60 per adult is manageable and many live on less. Your OH needs to cut back to £300 maximum.
Clothing................................ 50 - shoes and knickers only. Other clothes from e-bay or charity shops. Adults can wear what they own for a while.
Petrol/diesel........................... 80
Road tax................................ 25
Car Insurance........................... 45
Car maintenance (including MOT)......... 50
Car parking............................. 5
Other travel............................ 103 - what is this?
Childcare/nursery....................... 50
Other child related expenses............ 300 - what is this?
Medical (prescriptions, dentist etc).... 20
Pet insurance/vet bills................. 0
Buildings insurance..................... 44.5 - very high even combined with contents unless you are in a high risk area.
Contents insurance...................... 0
Life assurance ......................... 15
Other insurance......................... 0
Presents (birthday, christmas etc)...... 50 - reduce by half
Haircuts................................ 100 - Sorry but this is silly as well. Cut the kids yourselves, and try the local colleges
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
association............................. 10
professional subscriptions.............. 20
child trust fund........................ 57.5 - saving the roof over their heads has higher priority
swimming lessons........................ 50 - has to go
homecare 400............................ 43 - what is this?
homecare assist......................... 3
donation................................ 40 - has to go
family.................................. 45 - what is this?
lebara.................................. 20 - what is this?
Total monthly expenses.................. 3120.5

Assets
Cash.................................... 0
House value (Gross)..................... 250000
Shares and bonds........................ 100
Car(s).................................. 1000
Other assets............................ 0
Total Assets............................ 251100

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 188000...(968)......2.89
Total secured & HP debts...... 188000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
halifax loan...................5379.43...145.......12.04
sainsbury loan.................5549......149.......0
m & s loan.....................2472......224.......6.6
argos card.....................34........34........0
virgin credit card.............2100......160.......0
barclaycard mc 1...............4726......108.......0
barclaycard visa...............11475.....263.......0
halifax cc.....................7716......85........6.9
personal.......................2580......100.......0
halifax overdraft..............2000......31........0
barclays overdraft.............2550......33........0
sainsbury cc...................1700......50........6.9
g e capital....................3500......95........19.56
barclaycard mc 2...............2600......105.......0
Total unsecured debts..........54381.43..1582......-

Monthly Budget Summary
Total monthly income.................... 4,523
Expenses (including HP & secured debts). 3,120.5
Available for debt repayments........... 1,402.5
Monthly UNsecured debt repayments....... 1,582
Amount short for making debt repayments. -179.5
Personal Balance Sheet Summary
Total assets (things you own)........... 251,100
Total HP & Secured debt................. -188,000
Total Unsecured debt.................... -54,381.43
Net Assets.............................. 8,718.57

What is the cost of renting a similiar house locally? One option might be to sell up, settle up and rent for a while, then build a deposit. if you can keep stuff at 0% for a while, all well and good but it could get difficult.

Certainly if the cost of your mortgage or borrowings goes up a lot at any stage in the next two years, you may consider this option, or if you cannot reduce your debt substantially in that time.

mabbya

superted187 wrote: »

Welcome

Can I ask how you managed to accumulate such large unsecured debts?

Get organised NOW and start with hammering down that grocery bill. Cook large meals in bulk and make lunches at home. Cancel the Sky subscription, sort your mobile contract out and get your hair cut less. I'd also suggest cutting the amount you pat into your child trust funds. Although it would be a nice thing to do, you should stop temporarily and restart once you've got your debt under control.

Hammering your grocery bill down will be easy just as long as you get organised (make your work lunch the night before).

Originally borrowed towards deposit for house, then decorating, holdays, extra tuition for kids etc. started using credit cards and consolidating with loans or when i free up a credit card by transferring start using credit card again.