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Desperate to be debt-free, but where to start?
Comments
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no council tax? thats' paid by directdebit.. it should be there? ok so this is getting worse already.... what do you classify as an emergency fund ! I've never had one of those in my life...
I've always worked with the theory... I've got £200 left, if an emergency happens/something crops up, I'll use that... if not pay off a bit of the overdraft. The way this is going... I won't have any left to pay my overdraft let alone the credit cards.. Panicing now...0 -
A few questions to start:
Your brother pays just £200 rent including bills? Is that good for your area, could you ask him to contribute to some bills too?
Child maintenance at just £50 per month? That seems very low indeed, is it through the CSA or an independent agreement?
Your insurances all seem high - did you shop around at renewal?
£40 on hairdressers for you and a child is high. Try student hairdressers, or going longer between cuts.
What is Misc Budget: £250? You should separate this, or keep a spending diary to see where your money is really going. And try Martin's demotivator tool - is the latte a day worth staying in debt for a month longer for instance?
You're also spending £175 per month on food for just two of you - this could defo be reduced if you wanted it to be. See old style board for ideas and inspiration.
As you are meeting all the repayments then you obviously don't need to make any of these changes if you don't want, but small changes can make a massive difference to your debt-free date.:A If saving money is wrong, I don't want to be right. William Shatner
CC1 [STRIKE] £9400 [/STRIKE] £9300
CC2 [STRIKE] £800 [/STRIKE] £750
OD [STRIKE] £1350 [/STRIKE] £11500 -
holsinthesun wrote: »no council tax? thats' paid by directdebit.. it should be there? ok so this is getting worse already.... what do you classify as an emergency fund ! I've never had one of those in my life...
I've always worked with the theory... I've got £200 left, if an emergency happens/something crops up, I'll use that... if not pay off a bit of the overdraft. The way this is going... I won't have any left to pay my overdraft let alone the credit cards.. Panicing now...
Don't panic, there are lots of ways you can change the situation. And well done for deciding to deal with your debt :beer:. But to make a decision of what to keep, what to cut and what to pay you really will need a proper handle on what your incomings and outgoings are. Try the SOA here http://www.makesenseofcards.com/soacalc.html as this has boxes to fill in so you don't forget anything.:A If saving money is wrong, I don't want to be right. William Shatner
CC1 [STRIKE] £9400 [/STRIKE] £9300
CC2 [STRIKE] £800 [/STRIKE] £750
OD [STRIKE] £1350 [/STRIKE] £11500 -
so at the moment (hoping I've got nothing else to add to my outgoings) I'm left with £109 a mth... but at least I guess, I do have an emergency fund and my car tax/maintenance covered... what shall I do.... just ride it out til my loans finish and then use the spare cash to pay the cards off?0
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holsinthesun wrote: »so at the moment (hoping I've got nothing else to add to my outgoings) I'm left with £109 a mth... but at least I guess, I do have an emergency fund and my car tax/maintenance covered... what shall I do.... just ride it out til my loans finish and then use the spare cash to pay the cards off?
Its up to you, but when I realised what a staggering amount I owed and how much I was wasting - I opened a new bank account with the Halifax and got £100 for switching:) and then set up a SO to my old bank to pay the OD off. There is something great about having a bank account in credit at the end of the month - £26 this month which I will transfer to the old OD tomorrow when I get paid, and £300 in an online saver for the stuff that needs paying over the year and to build for emergencies.
You need an emergency fund as you don't have £200 left over a motnh and what something big needs replacing - boiler, cooker etc. Also kids generate massive unexpected bills such as school trips etc.
You're not in a bad position but small changes will make a difference and when the loans are paid you can increase payments to the cards. How much is the overdraft?Mama read so much about the dangers of drinking alcohol and eating chocolate that she immediately gave up reading.0 -
A few questions to start:
Your brother pays just £200 rent including bills? Is that good for your area, could you ask him to contribute to some bills too?
Child maintenance at just £50 per month? That seems very low indeed, is it through the CSA or an independent agreement?
Your insurances all seem high - did you shop around at renewal?
£40 on hairdressers for you and a child is high. Try student hairdressers, or going longer between cuts.
What is Misc Budget: £250? You should separate this, or keep a spending diary to see where your money is really going. And try Martin's demotivator tool - is the latte a day worth staying in debt for a month longer for instance?
You're also spending £175 per month on food for just two of you - this could defo be reduced if you wanted it to be. See old style board for ideas and inspiration.
As you are meeting all the repayments then you obviously don't need to make any of these changes if you don't want, but small changes can make a massive difference to your debt-free date.
Well my brother can't really afford any more, I'm doing him a favour you see, nowhere else to go... and his contribution is certainly helping me out.
The Child Maintenance... £50 it's been that for 8yrs since we divorced. He says he can't afford any more and as things aren't exactly tip top I daren't even ask for a penny more. It REALLY wouldn't be worth the hassle... just trust me on that one x
I haven't shopped around for Insurance in a couple of years so I could give that ago... and I know I could reduce by Sky subscription if I really wanted to.
The hairdressers... I could look around, especially one closer to home... it's just hard you know, been going to the same place for 15yrs ! Needs must tho I suppose.
The Misc budget - what I do is I take £250 when I get paid, split it into 4 or 5 envelopes and date them, one per week for the month. Average about £60 a week. I then use that to cover all things like milk, bread, haircuts, new joggers or sweets for my son. The only thing I spend on myself is a couple of packets of cigs and some beer each week (but thats always last, if theres any left). When it goes it goes, and we go without until the next envelope. So I don't necessarily spend £60 on fresh produce, it might be £30, but that just means for example, we can go to the cinema. Does that make sense.
My Asda shop was £80 this month (no washing powder and toilet rolls needed)... but I put the most it ever is £95 just to be on the safe side. I think it might be pricey because my son is a veggie, and I buy all the quorn stuff which is more expensive. I'll check next month and see if I can cut this back a bit tho..
It's scary when you write it all down, and work out how long its going to take to be debt-free it's quite disheartening.
I know I can make some cutbacks looking at all listed tho....
Thanks for everyones replys so far, they have been helpful, but this whole thing is quite upsetting to do, but I know I can't bury my head in the sand....
x0 -
Does your home insurance cover your Xbox? I'm just wondering if there is double cover there. Also, is the bulk of your alcohol and cigarettes money paying for more alcohol, or cigarettes? Could you perhaps cut down there? I know I saved an absolute fortune when I started monitoring my alcohol intake.
Finally, does your Sky bill need to be that high? Do you use all of the channels etc?HSBC Credit Card £608.69, HSBC Overdraft: £4123.67, HSBC Loan: £8,270.69
Lloyds Credit Card: £1418.62, Very Account: £518.99, Barclaycard: £126
Total Debt as of 9th June 2020: £15066.660 -
Its up to you, but when I realised what a staggering amount I owed and how much I was wasting - I opened a new bank account with the Halifax and got £100 for switching:) and then set up a SO to my old bank to pay the OD off. There is something great about having a bank account in credit at the end of the month - £26 this month which I will transfer to the old OD tomorrow when I get paid, and £300 in an online saver for the stuff that needs paying over the year and to build for emergencies.
You need an emergency fund as you don't have £200 left over a motnh and what something big needs replacing - boiler, cooker etc. Also kids generate massive unexpected bills such as school trips etc.
You're not in a bad position but small changes will make a difference and when the loans are paid you can increase payments to the cards. How much is the overdraft?
Thanks gizmo111... I like the bank idea as I hate being overdrawn, what you did sounds so good, I'd love to see a credit at the end of the month..
Oh and my overdraft is expected to be £3100 at the end of this month.0 -
holsinthesun wrote: »Well my brother can't really afford any more, I'm doing him a favour you see, nowhere else to go... and his contribution is certainly helping me out.
Fair enough, was just checking that it wasn't an amount agreed 5 years ago and never really thought of again
The Child Maintenance... £50 it's been that for 8yrs since we divorced. He says he can't afford any more and as things aren't exactly tip top I daren't even ask for a penny more. It REALLY wouldn't be worth the hassle... just trust me on that one x
Again, not knowing the circumstances means it is firmly in your court, but if you went through the CSA you'd defo get more (even if he's only on minimum wage and has lots of other children to support), and it would come straight out of his wages so he'd have to pay it.
I haven't shopped around for Insurance in a couple of years so I could give that ago... and I know I could reduce by Sky subscription if I really wanted to.
It is ALWAYS worth shopping around - you'd be amazed at the "new customer" deals you can get.
The hairdressers... I could look around, especially one closer to home... it's just hard you know, been going to the same place for 15yrs ! Needs must tho I suppose.
The Misc budget - what I do is I take £250 when I get paid, split it into 4 or 5 envelopes and date them, one per week for the month. Average about £60 a week. I then use that to cover all things like milk, bread, haircuts, new joggers or sweets for my son. The only thing I spend on myself is a couple of packets of cigs and some beer each week (but thats always last, if theres any left). When it goes it goes, and we go without until the next envelope. So I don't necessarily spend £60 on fresh produce, it might be £30, but that just means for example, we can go to the cinema. Does that make sense.
That does make sense, but it also seems that you SOA might be a bit more like guess work. The key to any debt-free journey is knowing exactly where your money is going. I suggest a spending diary for every penny!
My Asda shop was £80 this month (no washing powder and toilet rolls needed)... but I put the most it ever is £95 just to be on the safe side. I think it might be pricey because my son is a veggie, and I buy all the quorn stuff which is more expensive. I'll check next month and see if I can cut this back a bit tho..
Usually it is more expensive to eat meat than be veggie, though if you are doing separate meals that might explain some. As I said, check out the old-style board for some really awesome tips.
It's scary when you write it all down, and work out how long its going to take to be debt-free it's quite disheartening.
I know I can make some cutbacks looking at all listed tho....
Thanks for everyones replys so far, they have been helpful, but this whole thing is quite upsetting to do, but I know I can't bury my head in the sand....
x
The most important thing is that you are ready to actually start dealing with this. Try reading some of the debt-free diaries to get an idea of how well people manage in really difficult circumstances, and how proud people are when they have paid things off. It really does provide an inspiration.:A If saving money is wrong, I don't want to be right. William Shatner
CC1 [STRIKE] £9400 [/STRIKE] £9300
CC2 [STRIKE] £800 [/STRIKE] £750
OD [STRIKE] £1350 [/STRIKE] £11500 -
If you do change insurances then make sure you use quidco for some cashback.Mama read so much about the dangers of drinking alcohol and eating chocolate that she immediately gave up reading.0
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