Home Owner needing help

lazer

Hi Everyone.

I know how useful everyone on the DFW board is so i'm hoping you can help me out a bit with me SOA.

It looks as it I have should have a decent suprlus every month but i don't. I bought my house 2 months ago.

Statement of Affairs and Personal Balance Sheet
Household Information[/b]
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1943
Partners monthly income after tax.......0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1943

Monthly Expense Details
Mortgage................................ 468
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 92
Electricity............................................35
Gas..................................... ...............0
Oil..................................... ................35
Water rates......................................... 0 - NI - so none
Telephone (land line)............................. 12
Mobile phone........................................10
TV Licence...........................................12
Satellite/Cable TV................................. 20
Internet Services.................................. 9
Groceries etc. ..................................... 200 (paid via CC)
Clothing.............................................. 0
Petrol/diesel........................................ 200 (mainly work and long distance relationship - 100 mile apart)
Road tax............................................ 14
Car Insurance..................................... 30
Car maintenance (including MOT)............ 20
Car parking.......................................... 0
Other travel......................................... 0
Childcare/nursery.................................. 0
Other child related expenses................... 0
Medical (prescriptions, dentist etc)........... 1
Pet insurance/vet bills............................ 0
Buildings insurance............................... 21.24
Contents insurance.............................. 0
Life assurance ........................ .......... 38.57
Other insurance.................................. 0
Presents (birthday, christmas etc)......... 20
Haircuts............................................ 5
Entertainment.................................... 160
Holiday............................................. 20
Emergency fund................................. 50
Massage (For Medical Reasons) ............ 24
Gym/Classes...................................... 45 (Getting Married so desperately trying to lose weight!)
Total monthly expenses...................... 1541.81

Assets
Cash......................................... 4527
House value (Gross)..................... 115000
Shares and bonds........................ 0
Car(s)....................................... 3000
Other assets.............................. 3000 (Engagement ring)
Total Assets.............................. 125527

Secured & HP Debts
Description...........................Debt......Monthly...APR
Mortgage........................... 97500.....(468)......3.99
Total secured & HP debts...... 97500.......-..........-
Unsecured Debts
Description...........................Debt......Monthly...APR
Santander Credit Card...........1068.........12........0
MBNA............................... .559.47.......0.........0 - see below
Tesco................................770.7.........0.........0 - see below
Halifax................................9.29..........0.........0 - see below
Total unsecured debts..........2407.46......12........-

Monthly Budget Summary
Total monthly income........................... 1,943
Expenses (including HP & secured debts). 1,541.81
Available for debt repayments.................. 401.19
Monthly UNsecured debt repayments.......... 12
Amount left after debt repayments........... 389.19
Personal Balance Sheet Summary
Total assets (things you own)........... 125,527
Total HP & Secured debt................. -97,500
Total Unsecured debt.................... -2,407.46
Net Assets.................................. 25,619.54
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.[/font]

To explain the credit cards -The Santander Credit card is 0% until August. The money to cover this is included in the cash, and is in seperate account to my normal savings

The remining credit cards are used for monthly day to day expenditure and paid off the following month (Therefore no interest and I receive the rewards points) (Generally around £400 for petrol & grocericies). The current balance includes work expenses for £926, which I have still to be re-imbursed for.

Because I have now got into the cycle where i pay off the credit cards on pay day, it is difficult to get of this cycle, which is what i want to do as I hate being a month in arrears all the time. The majority of the savings are in an ISA so do not really want to use to cover the arrears for one month.

I know i should have a surplus, but I don't so far - although should probably just be happy not to really have used the savings on moving into the new house.
There has been a number of expensive purchased which have used the surplus since moving in, a tank of oil, new bed and various bits and pieces.
Now my car insurance is due in May, so thats another lump sum - although moving £150 in April to one svings account to try and cover at least part of this.

I know the groceries are probably to high - but this includes cleaning products and everything required to stock up the cupboards as still just finding my feet in the new house. Going to try and keep to £120 a month.

Any advice gratefully received!

findingmyownway

Hi and welcome to DFW

I can see why you don't want to use savings to pay off CCs, and as you aren't paying any interest there isn't any real reason to BUT you're clearly not happy with the status quo. I don't know how much your reward points are worth, but maybe not as much as the peace of mind you would have if you paid them all off? I am debt free and so could do a similar scheme as you - buy things on cc and earn points. But to me its not worth it, I like paying cash/debit card and knowing that I have the money to cover it. Anyway, perhaps something to think about?

Regardless of how you pay for your monthly items, I can see a few things you could cut down on to free up cash for wedding/savings...


Mortgage................................ 468
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 92 does this include single person discount?
Electricity....................................... .....35
Gas..................................... ...............0
Oil..................................... ................35
Water rates......................................... 0 - NI - so none
Telephone (land line)............................. 12
Mobile phone........................................10
TV Licence........................................... 12
Satellite/Cable TV................................. 20 not really essential, do you use it enough to justify?
Internet Services.................................. 9
Groceries etc. ..................................... 200 (paid via CC) £200/month for one person is quite a lot, perhaps start keeping a list of what you buy and work out how essential it is? Plenty of ways to cut back by bulk-cooking etc on Old Style and Grocery boards.
Clothing.......................................... .... 0 You never buy clothes???
Petrol/diesel........................................ 200 (mainly work and long distance relationship - 100 mile apart)
Road tax............................................ 14
Car Insurance..................................... 30
Car maintenance (including MOT)............ 20
Car parking.......................................... 0
Other travel......................................... 0
Childcare/nursery.................................. 0
Other child related expenses................... 0
Medical (prescriptions, dentist etc)........... 1
Pet insurance/vet bills............................ 0
Buildings insurance............................... 21.24
Contents insurance.............................. 0 you should have this
Life assurance ........................ .......... 38.57 seems a bit expensive (mine is £6), can you elaborate?
Other insurance.................................. 0
Presents (birthday, christmas etc)......... 20
Haircuts.......................................... .. 5
Entertainment.................................... 160
Holiday........................................... .. 20
Emergency fund................................. 50
Massage (For Medical Reasons) ............ 24
Gym/Classes...................................... 45 (Getting Married so desperately trying to lose weight!) do you really use it enough? running / cycling is free
Total monthly expenses...................... 1541.81


Also, whats your plan for after the wedding? Are you and new wife going to live together then? Is there no way she can move in sooner to share the bills?

The best way to address the surplus of disappearing income is to keep a spending diary, or just go through last 3 months statements to see where it really went!

antonia1

Hi Lazer, and welcome to the debt-free wannabe board.

Your situation seems pretty good - you have enough cash to pay off the credit cards if you wanted to.

I think a spending diary could really help you - it will show you where your money is actually going. Your SOA seems to be missing a few important items - clothing, contents insurance for example. And is the £1 per month medical correct?

Also, are you really budgeting properly for your car? Your SOA says you should be putting aside £30 per month for insurance. Do you actually have this somewhere for when your insurance is due?

Have you considered keeping a separate credit card for work expenses? I keep mine separately because it is money my company owes me.

Once you take out the 0% credit card, and work expenses, your actual debt is only £413.46. This should be easily cleared once you have worked out where your money is going.

Spending on a credit card and paying it off each month is very good when you have total control over your spending. It seems like you are struggling to get a handle on things in your new place, so maybe switch back to using cash for a while?

DreamerV

Made some suggestions below

lazer wrote: »

Statement of Affairs and Personal Balance Sheet
Household Information[/b]
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1943
Partners monthly income after tax.......0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1943

Monthly Expense Details
Mortgage................................ 468
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 92
Electricity............................................35
Gas..................................... ...............0
Oil..................................... ................35
Water rates......................................... 0 - NI - so none
Telephone (land line)............................. 12
Mobile phone........................................10
TV Licence...........................................12
Satellite/Cable TV................................. 20 If this is Sky, sometimes when you phone and threaten to leave they will accept smaller amount for 3 months (I used to phone up and get mine changed to £3 every 3 months). I have since moved to freeview using the old sky box - costs nothing, and I don't really miss sky as I get most of the channels anyhow.
Internet Services.................................. 9
Groceries etc. ..................................... 200 (paid via CC) This is high enough for 2 people. I would expect £100 on a tight budget or £110-£120 on an adequate budget. Could you reduce your shopping to £35 weekly, so around £150 a month?
Clothing.............................................. 0 I am guessing you will need clothes as you lose weight - is certainly the case with me when losing weight. May be worth budgeting a tenner a month or something?
Petrol/diesel........................................ 200 (mainly work and long distance relationship - 100 mile apart)
Road tax............................................ 14
Car Insurance..................................... 30
Car maintenance (including MOT)............ 20
Car parking.......................................... 0
Other travel......................................... 0
Childcare/nursery.................................. 0
Other child related expenses................... 0
Medical (prescriptions, dentist etc)........... 1
Pet insurance/vet bills............................ 0
Buildings insurance............................... 21.24
Contents insurance.............................. 0 I agree with others that you should have something here, or is it included with your buildings insurance?
Life assurance ........................ .......... 38.57 Seems high? I don't know how this works but if you are losing weight, are you a better prospect to the insurance company now?
Other insurance.................................. 0
Presents (birthday, christmas etc)......... 20
Haircuts............................................ 5
Entertainment.................................... 160
Holiday............................................. 20
Emergency fund................................. 50
Massage (For Medical Reasons) ............ 24
Gym/Classes...................................... 45 (Getting Married so desperately trying to lose weight!) Couch to 5k is a great free way to lose weight, but I also like the gym. That said I pay less than £20 a month for almost complete access. Is there no way to bring the cost down by going onto a different membership level or going to a different gym?
Total monthly expenses...................... 1541.81

Assets
Cash......................................... 4527
House value (Gross)..................... 115000
Shares and bonds........................ 0
Car(s)....................................... 3000
Other assets.............................. 3000 (Engagement ring)
Total Assets.............................. 125527

Secured & HP Debts
Description...........................Debt......Monthly...APR
Mortgage........................... 97500.....(468)......3.99
Total secured & HP debts...... 97500.......-..........-
Unsecured Debts
Description...........................Debt......Monthly...APR
Santander Credit Card...........1068.........12........0
MBNA............................... .559.47.......0.........0 - see below
Tesco................................770.7.........0.........0 - see below
Halifax................................9.29..........0.........0 - see below
Total unsecured debts..........2407.46......12........-

Monthly Budget Summary
Total monthly income........................... 1,943
Expenses (including HP & secured debts). 1,541.81
Available for debt repayments.................. 401.19
Monthly UNsecured debt repayments.......... 12
Amount left after debt repayments........... 389.19
Personal Balance Sheet Summary
Total assets (things you own)........... 125,527
Total HP & Secured debt................. -97,500
Total Unsecured debt.................... -2,407.46
Net Assets.................................. 25,619.54

DominicJ_2

The remining credit cards are used for monthly day to day expenditure and paid off the following month (Therefore no interest and I receive the rewards points) (Generally around £400 for petrol & grocericies).

I do the same, I put £1200 a month through my CC, have £1200 a month savings, and I earn £12 a month cashback, plus interest on £1200.
But I do it all on one card. Using three seems a bit of an odd way to go about it.

lazer

Thanks guys for the comments.

To clarify a few points - The contents insurance is included in the buildings insurance

The life insurance I do wonder if it is too high, its is roughly £20 for income protection insurance (which i will probably cancel after I get married, as I will then have a second income to rely on also - but will look into this in detail). The remaining £20 is critical illness/life insurance, which I will keep.
I was told at the time it is cheaper the take these things out when younger rather than waiting to I get married, have children etc, as the cost would then be higher - any views on this anyone?

The Gym/Classes is PAYG basically - its mainly Zumba classes, i do 2 a week at £5 a go, as well as other sessions at the leisure centre - which thnakfully is only £1 a time as the current special offer. I did try and cut down to jsut one Zumba and out running on the 2nd night - but my weight didn't change one week and went up by 1lb the next - so as long as the Zumba keeps working, i'm keeping at it!

I wouldn't generally tend to use the 3 cards, one is for work expenses, the other personal, and the 3rd emergency - I only used it this month as I had left the other cards at home!

The TV is sky, its a package of £32 (6 months internet free), then up to £39 for the next 6. This is landline, internet and TV. The best internet/Landline deal i could have got was £27 a month and they were charging me £120 to put in the phone line whereas sky doen it free, and I got significan cash back too - so it was a well thought out deal (Also I am not in a freeview area and don't have a TV aerial!)

Unfortunatley we don't get a single person discount on the rates in NI!

I think i will review the credit card thing, I want to start buying on the CC and then paying the CC straigh - without waiting for the bill, and will review the current savings to see if I can achieve this for one month without touching the ISA.

I've always had a good handle on money, I'm just feeling a bit of lack of control now after the new house!

Clothing - I'm handy with a sewing machine, and combined with a few Charity shop purchases, have enough to see me through to the next size decrease!

camuk81

Lazer, any chance of a spending diary or spreadsheet. I found with this method I tend to keep my main account as paying money out of monitoring my credit card spending then forcing the limit down to stop over spending.

camuk81

Just to clarify you have £160 on entertainment can this be cut back anywhere else. Make it £100.00 instead?

anna_d_2

As regards insurance, if that includes income protection I would say, yes it is a good deal. And £20 for Life and CIC is quite good - definitely a better idea to get it while young (and keep it!) because you are a homeowner with mortgage.

lazer

camuk81 wrote: »

Just to clarify you have £160 on entertainment can this be cut back anywhere else. Make it £100.00 instead?

Thanks - Although i doubt i would manage this! I find it hard enough to keep to £40 a week!

I only see my fiance at weekends, so we tend to try and do fun stuff. We do try to save money, having a nice dinner, DVD and a night in, but both of us generally want to go out on a Saturday night for a bit of a laugh, and meet up with friends.
I also generally meet my friends during the week for a night, and aas we all love in different places, it limits the amount of times we can simply go to someones house.

I think i am jsut panicking as the savings haven't been increasing by the proposed £400 a month, and don't look likely to be anytime soon.

I have now sent up a spending diary in excel and gone back over old statements, and it does seem as if most of the overspend has been in relation to the house. Its easy to forget the £10 spent buying mops & brushes in £strecther, the £20 on lampshades etc, but they all mount up. So hopefully it can all be back on track from this month - no furniture or home stuff to be bought this month! I must try and restrain the urge to sort the garden out - or else decide to spend £30 on the garden and not go out at the weekend - I can't have it all, and the wedding I want too!

Tixy

The thing you are most worried about is the missing surplus? I don't think your SoA is too bad apart from this issue (yes there are some areas you could reduce but if you had the surplus you should have then you don't 'need' to cut back anywhere).

Given its only been 2 months I think the problem is just all the bits of one off costs and extras that you've been paying out and that hopefully you'll find you do have that surplus moving forward.

In terms of your stoozed santander card - do you intend to repay in August?

With the other cards - I don't see anything wrong in using cards and paying off in full the following month, in fact if you can make it work its a good idea.
But if you are paying off in full then you have spent a lot (£1338) on the cards last month - does that spend agree to items in your SoA? I guess £200 on groceries and £200 on petrol are the obvious items - what else have you put on your card that either is or isnt on the SoA?

The problem you have this month is you have £1138 to clear and perhaps only £400 to put on the card for paying off next month - so this month you will again not have a surplus - and in fact could have a shortfall.

I would perhaps consider limiting the card use to just petrol and groceries in future, rather than try to stop using it altogether - that way the balance will only ever be around the £400 mark and you'll know you've got it covered from your budget the following month and you still earn a bit of cashback on the cards.