Newly in debt and raring to get back out of it!

charleyroo

Hi all

I've been reading the DFW boards recently and have found all of your stories to be inspirational.

I'm not quite sure where to start with my story - there aren't any bad circumstances or stress like most people's stories unfortunately tend to be.

I'm quite a determined person. I spent a lot of my childhood wishing to be in a better place, and hoping I'd be happy when I was older! (thankfully I am) but it made me want to have a good career and never rely on anyone and stand on my own feet. When I was 16 I applied for an apprenticeship and didn't get it, so I applied the next year and got it, and started on a good wage for an apprentice. So I was 17 (am 22 now), on about £10k. It was then that I got my first loan (for about £1900 - at 17% APR) for a car. I was giving my parents £200 a month for keep so being impatient and wanting things now I took the loan. The car got more troublesome before the loan was over, so I had it all fixed and got rid of it, and paid off the loan with the proceeds. I had a rather large £1500 overdraft too. My dad told me he would pay it for me, but I had to pay him back at £500 a month to learn my lesson. He knew I would never have had the resolve to pay it back as it was, but he knew I would never dare miss a payment to him!

By now, I was living with my partner (now fiance) so we were running a rented house, and paying my dad. As you may remember, I sold my car - so I needed another to get to work! My credit report was thin and I didn't want any more official debt, I was lucky enough that my dad (hero again) agreed to loan me £2000 and I was to pay him back 100 a month until I'd paid him £2200 (I made the last payment this month!)

In the meantime, we've rented a slightly more expensive place, learned the art of saving for things that we want, saving for a house and bought our first house, cheaper than what we were renting. I've been lucky enough to be able to earn tons of overtime, and then had a great promotion that takes me to the same take home pay without the need to work extra.

Unfortunately, the car (an ex cat C write off!) is beginning to show its true colours (I don't blame it, it didn't cost me that much in hindsight) and I've paid out a few hundred since the summer in repairs (and have more to come) and after much discussion and deliberation we decided to be extravagent for once and buy a new car.

I do in some respects feel like I've let us down, taking a loan for something we could have probably saved for, given enough time. Despite this I went ahead with it for many reasons and this is the thread I had on the Loans board (I don't know how to move them) to save typing out my trails of thought and arguments with self!

http://forums.moneysavingexpert.com/....php?t=3597345

As it says, I want to set myself up to be in no doubt that I will be debt free again. I would like to post an SOA (I have been wanting to post one for ages because I've been keen to see where I can improve our expenditure, but never been sure where to put it on these boards - now I can post it here) When putting mortgage payments should I include my overpayments etc?

Thanks if you managed to read all of the above without stopping!

charleyroo

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................ 1600
Partners monthly income after tax....... 1000
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2600

Monthly Expense Details
Mortgage................................ 393
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 105
Electricity............................. 35
Gas..................................... 30
Oil..................................... 0
Water rates............................. 35
Telephone (land line)................... 26.5
Mobile phone............................ 56
TV Licence.............................. 12
Satellite/Cable TV...................... 21
Internet Services....................... 0
Groceries etc. ......................... 140
Clothing................................ 0
Petrol/diesel........................... 60
Road tax................................ 0
Car Insurance........................... 55
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 120
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 15.5
Buildings insurance..................... 24
Contents insurance...................... 0
Life assurance ......................... 27
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 20
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1175


Assets
Cash.................................... 0
House value (Gross)..................... 82805
Shares and bonds........................ 10700
Car(s).................................. 8500
Other assets............................ 0
Total Assets............................ 102005


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 75714....(393)......3.59
Total secured & HP debts...... 75714.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Nationwide loan................8000......245.......3.59
credit card....................300.......25........0
Total unsecured debts..........8300......270.......-


Monthly Budget Summary
Total monthly income.................... 2,600
Expenses (including HP & secured debts). 1,175
Available for debt repayments........... 1,425
Monthly UNsecured debt repayments....... 270
Amount left after debt repayments....... 1,155

Personal Balance Sheet Summary
Total assets (things you own)........... 102,005
Total HP & Secured debt................. -75,714
Total Unsecured debt.................... -8,300
Net Assets.............................. 17,991

Created using the SOA calculator at https://www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using Firefox browser.

charleyroo

So above is my SOA

Points to consider;

Not included in above
£100 overpayment to mortgage each month (soon to become £200!)
money we spend on presents, hols, nights out, drink, cinema etc.... as a rough, I allow us between £400 - £500 to spend on any old carp!
My shares are locked in, I have £2,500 to be released in August, around £1000 the following August, £6000 in 2014 und so weiter.
I don't have credit card bills every month, I usually put the fuel on there so I have a view of what to budget to pay it the following month and pay all of that off. This month I used my card to book a flight to Austria and a couple of other things.
My car insurance is already paid for this year but have included it to save for next year
I have to pay £120 a month during January, Feb and March towards my uni fees (work have paid the other half)

I'm hoping to start money saving in earnest in January. My pay and things is a bit skewed until then. Next month I have a backpay of almost £2000 in delayed promotion.... yay you might shout! However, this is, and always has, been earmarked to pay for our cruise in February (the first and last expensive holiday we go on for quite some time!)

charleyroo

I've planned to pay the first payment in December (if it comes out in December :S hmm) of £245 and concentrate on tidying up other odds and ends and also save towards our holiday spending money rather than put any of it on the credit card
Plan for December:
- go to Vienna with £100 spending money and come home with change
- home made Christmas pressies and agree with family no gifts/max spend
- pay cruise using back pay
- work any Saturdays offered (have already started hinting)
- stop buying lunch in work as it is a waste of money and am spending £4.29 a day (£1 on a coffee @ train station, £3.29 on Boots meal deal)
- OH to work any Saturdays offered
- I pay £200 a month into share save before tax, £12o is 'mine' and £80 is my dads, he gives me cash to pay his portion which I try and not collect off him until late in the pay month to pay for the dog food etc


will add more as they appear in my head

mf0u1098

Keep going charleyroo, you're doing great!

charleyroo

thanks, looking at your signature you're doing a phenomenal job!

what worries me is that i read other people's SOAs and they can split off clothes, meals, presents etc. Well, I pay all our bills and things and (before I had the loan) saved the £500/£600 change after taking out between £300 - £500 for our 'spending money', i.e. work lunch, treats etc.

Maybe a spending diary will help me see what we are actually spending all of that on

charleyroo

Perhaps I should adjust my SOA as my house is shared equity and although I never have to pay it back if I don't want to, I probably shouldn't include it in my assets, lol.

charleyroo

ahh, just got super excited because I've had an email to say one of my Quidco cashbacks has been paid. I was hoping it would be the £30 I earned from pet insurance but alas it was the £3.92 I earned from Music Magpie

Every little helps though and my OH used my second credit card to buy a book for me for uni off eBay, I will use it to pay most of that off, hehe.

Tomorrow's another day - and I've bought some Weight watchers ready meals for £1.50 each from Sainsburys (saved 50p) to take to work instead of buying food. I know it's still not the cheapest, but it's more than half the £3.29 I normally spend

I also bought a huge pack of chicken legs reduced, chicken thighs reduced, fish cakes reduced, Taste the Difference steaks reduced, and sausages all reduced which will feed us until at least the weekend all in the freezer now. Turns out Tuesdays are good for things being labelled almost out of date

yellow3

Your doing fab charley, keep posting!

Yellow x

charleyroo

I know it will be hard for anyone to have thoughts about my SOA because all the 'personal spends' are very vague at the moment but if anyone has any pointers on what I've posted I'd love to hear them.

For 2 adults, what should I be looking at spending reasonably on clothes, entertainment etc?

Today is my first day and as far as spending I've spent £1.98 on a can of Red Bull (I should cut that out really) and a tube of Lockets (have a terrible cold) and £1 on a coffee on the train.

I've brought in my lunch and breakfast though. I will probably spend another couple of pound on coffee at Uni this afternoon though but determined not to eat at Uni tonight, am going to try and have tea when I get home - well I'll be forced to anyway because I only have about £2 left, lol. I also spent £1 on a previously promised sponsorship for a raffle ticket.

So that's £3.98 actually spent so far today.


I've also been through my housekeeping sheet and seen what I can try and reduce. I've zeroed my council tax in Feb and March and increased my savings/overpayments directly. I've also called the Co-op and cancelled my dormant Privelige (Sp) account, it was costing me £10 a month and I also have a paid account with Natwest. I have no idea why I never cancelled the Co Op account to be honest! I had to pay off my £40 overdraft accrued over the past few months with these stupid banking fees but I figured it's good to save the £10 a month and that's £200 less 'available credit' also with the cancelled overdraft. I've also decreased my direct debit to BT, I was paying £26.50 in a month and was £20 in credit and seems as I never make any calls I thought a decrease to £16.50 was quite justified. So that's an extra £20 a month to go in savings

I've worked out my overpayments wrong on my loan, I've aimed to start overpaying from February (£600 increasing by £50 in March) but I forgot to increase my overpayment on the mortgage also.

So I need to edit this;
Loan MinimumOverpay
December £245.00£0.00
January£245.00£0.00
February£245.00£500.00
March£245.00£650.00
April£245.00£650.00
May£245.00£650.00
June£245.00£650.00
July£245.00£700.00
August £245.00£700.00
September£245.00£700.00
October£245.00£255.00
£2,695.00£5,455.00
total£8,150.00

charleyroo

Day 2 and I've brought my own lunch in again - another £3.29 saved! I also haven't bought a yoghurt or Red Bull for breakfast - I do feel a bit drained - but I've saved loads!

I haven't spent anything out of my bank account for a couple of days now either. I need to think of a challenge for myself I thought about not having any red bull for a month but then I thought, well I could just buy the own brand multi packs?

Anyone got a good challenge for me to save extra money?