I hope someone can help me....

LaidBackDad

Hi, I am a married 31 year old with 2 cracking kids, a boy and a girl (3 and 6).

I have a good job with good wages, nice 3 bedroom house and a decent car. We've been to florida 3 times, got a nice big 3d telly, nice climbing frame for the kids, yadda yadda yadda.

But I'm miserable. All of the above is a mirage because of all the debt we are in. We couldnt afford any of the above. we should be able to on my wages alone but we live well beyond our means.

There are times I feel sick everytime i think of what we owe, but as my name suggests, a lot of the time I can put it all to the very back of my mind and just carry on regardless without a care in the world. And, my wife is a carbon copy of me!

So, I want to sort it out now. I certainly want to be sorted by the time im 40, but hopefully it will be sooner than that.

I gues, reading other threads, that I should start with an SOA, which will follow shortly.

Thanks for having me!

gargrave50

Welcome laidbackdad, and congratulations on recognising the signs of living outwith your means - that took me years to admit .

Start with an SOA, making short term savings could give you a plan to pay chunks off debts .

southernbelle

Congratulations! It took me years, and a number of false starts before I admitted I couldn't afford to live the way I was. Funny thing is, I would be living much better now if I wasn't in debt!!

Every journey starts with a single step. :money:

LaidBackDad

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 2900
Partners monthly income after tax....... 200
Benefits................................ 150
Other income............................ 0
Total monthly income.................... 3250
Monthly Expense Details
Mortgage................................ 754.8
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 135.06
Electricity............................. 65
Gas..................................... 61
Oil..................................... 0
Water rates............................. 55.5
Telephone (land line)................... 0
Mobile phone............................ 55 (me and wife)
TV Licence.............................. 0
Satellite/Cable TV...................... 87 (tv,phone,internet)
Internet Services....................... 6.99
Groceries etc. ......................... 400
Clothing................................ 50
Petrol/diesel........................... 240
Road tax................................ 165 (yearly)should read 13.75
Car Insurance........................... 13.75
Car maintenance (including MOT)......... 40
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 25
Medical (prescriptions, dentist etc).... 20
Pet insurance/vet bills................. 0
Buildings insurance..................... 25
Contents insurance...................... 0
Life assurance ......................... 40
Other insurance......................... 0
Presents (birthday, christmas etc)...... 100
Haircuts................................ 40
Entertainment........................... 0
Holiday................................. 250
Emergency fund.......................... 0
Total monthly expenses.................. 2629.1

Assets
Cash.................................... 0
House value (Gross)..................... 175000
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 176500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 138000...(754.8)....0
Total secured & HP debts...... 138000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Santander Loan.................18000.....485.......0
Barclaycard....................8000......125.......0
Barclaycard....................900.......5.........0
virgin.........................2089......63........26
Total unsecured debts..........28989.....678.......-

Monthly Budget Summary
Total monthly income.................... 3,250
Expenses (including HP & secured debts). 2,629.1
Available for debt repayments........... 620.9
Monthly UNsecured debt repayments....... 678
Amount short for making debt repayments. -57.1
Personal Balance Sheet Summary
Total assets (things you own)........... 176,500
Total HP & Secured debt................. -138,000
Total Unsecured debt.................... -28,989
Net Assets.............................. 9,511

tallyhoh

the grocery bill certainly jumps out, try the old style money saving boards for tips on cutting down.
Is the holiday booked, thats an awful lot of money per month. Any chance of stopping this.
Any way your wife could increase her income?

LaidBackDad

tallyhoh wrote: »

the grocery bill certainly jumps out, try the old style money saving boards for tips on cutting down.
Is the holiday booked, thats an awful lot of money per month. Any chance of stopping this.
Any way your wife could increase her income?

Yes the holiday is all booked and "paid for" (its on the barclaycard ) We go July 28th. Thinking about it I shouldnt have included it if we dont plan to go next year?

Groceries are the source of a lot of arguments in our house. I may get a bit more involved in the shopping because we do throw a lot of food out i find.

DS4215

The good news is that your total is wrong - it should be ~2477 or so if the Road Tax is 13.75 a month. This gives you a surplus of ~£90 on your SOA. I would guess though that with a couple of kids you do spend on entertainment.

Out of your listed spends, £250 for a holiday and £100 for presents is too much. Cut those down for a few months and throw it towards the smallest debts You should also be able to cut down your grocery bill to nearer half of the £400 you are currently spending without too much difficulty.

PlutoinCapricorn

Good for you for admitting that things can't go on the way they have been and for deciding to do something about it.

There is a lot that you can do: although many people with high running costs think they have little scope for cutting down and that saving a few pence here and there won't make much difference, the saving do add up over the years.

For example, using basic cleaning materials saves a fortune: you don't need all the branded products for windows, bathrooms etc. I get many presents from charity shops - a friend loved the china mug I gave her and is cost me £0.40p! I spent £5 on someone else's children in charity shops and they play with the stuff every day.

Many people have far too much 'stuff'; I never buy anything without a good business case: for example I only got a new TV when the one I had for 25 years died! eBay is a wonderful place for bargains. I am not ashamed but proud of living on a tiny amount as I have no debts at all.

Do spend some time looking for good tips: I learned about white vinegar and Stardrops on MSE.

gargrave50

LaidBackDad wrote: »

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 2900
Partners monthly income after tax....... 200 Any way this could increase?
Benefits................................ 150
Other income............................ 0
Total monthly income.................... 3250
Monthly Expense Details
Mortgage................................ 754.8
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 135.06
Electricity............................. 65 very high for electricity and gas - try a comparison website to see if you can get this cheaper. If you find someone cheaper go via a cashback site for maximum value. (Try Quidco)
Gas..................................... 61
Oil..................................... 0
Water rates............................. 55.5
Telephone (land line)................... 0
Mobile phone............................ 55Not bad considering its for both. If any are coming to the end of their contracts see if you can move down a tarriff. (me and wife)
TV Licence.............................. 0 Really?! Fines are thousands. Hope you have paid the entire year up front, otherwise you have missed a necessary cost.
Satellite/Cable TV...................... 87 I had a similar bill, then decided we don't use the movies, and we don't use the sports in the close season when the football isn't on - it's worth trimming or expanding your package as and when you need to. If you are with Sky they are well known for giving you a deal to keep the full package if you threaten to leave?! (tv,phone,internet)
Internet Services....................... 6.99 If your TV is with Sky you will qualify for their free broadband - its fab I've had it for years.
Groceries etc. ......................... 400 This is a little high, but in reality I expect you actually spend even more than this. Keep a months receipts and get a true idea of what this costs you.
Clothing................................ 50
Petrol/diesel........................... 240 Huge cost - £60 a week - does your work cover any of this? If not might be time to change your car for something more economical.
Road tax................................ 165 (yearly)should read 13.75
Car Insurance........................... 13.75
Car maintenance (including MOT)......... 40
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 25 Could you possibly clarify what these are?
Medical (prescriptions, dentist etc).... 20 Is this prescriptions? If so a pre pay certificate would be cheaper
Pet insurance/vet bills................. 0
Buildings insurance..................... 25 Shop around using comparison sites to see if you can reduce this cost, and go via Quidco or similar once you find who is cheapest.
Contents insurance...................... 0
Life assurance ......................... 40 This is quite high, shop around.
Other insurance......................... 0
Presents (birthday, christmas etc)...... 100 This needs to reduce until you have got your debts down. £1200 a year is a'lot of gifts. I have an idea to help you with gift buying - see below;).
Haircuts................................ 40 Needs to be reduced whilst tackling your debts.
Entertainment........................... 0 I don't think this is true.
Holiday................................. 250 This is contributing to your debt - it won't only be the cost of the holiday, you will have spending associated with this. A year without a holiday if you are saving £250 for 12 months, could be £3k wiped off your debt. SERIOUSLY THINK ABOUT THIS.
Emergency fund.......................... 0
Total monthly expenses.................. 2629.1

Assets
Cash.................................... 0
House value (Gross)..................... 175000
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 176500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 138000...(754.8)....0
Total secured & HP debts...... 138000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Santander Loan.................18000.....485.......0
Barclaycard....................8000......125.......0
Barclaycard....................900.......5.........0
virgin.........................2089......63........26
Total unsecured debts..........28989.....678.......-

Monthly Budget Summary
Total monthly income.................... 3,250
Expenses (including HP & secured debts). 2,629.1
Available for debt repayments........... 620.9
Monthly UNsecured debt repayments....... 678
Amount short for making debt repayments. -57.1
Personal Balance Sheet Summary
Total assets (things you own)........... 176,500
Total HP & Secured debt................. -138,000
Total Unsecured debt.................... -28,989
Net Assets.............................. 9,511

Apologies if you find this harsh, but its a harsh situation and a tongue lashing sorted me out when I was in your position.

You have a monthly shortfall, yet are budgeting £250 a month for a holiday. You are not only living outwith your means, you are increasing your debt month on month.

The life you lead is probably all very glam, but it's going to end up not quite so glam very soon. It's going to take fairly drastic action which might mean disappointing your wife and kids for a holiday this year, but in reality its in their best interest.

Sorry - not what you want to hear. I also suspect you have missed out some important costs. When I kept a months receipts for my shopping I was horrified. I suspect you spend more than £400 a month on groceries.

In terms of your partners income, any chance this could increase?

For gifts - immediately these need to cut down. I manage to contribute heavily towards Christmas and getting wedding gifts etc by doing surveys for vouchers or cash. Try getting your partner (and you) to register for some of the following sites.

GLOBAL TESTMARKET
VALUED OPINIONS
MY SURVEY UK
MAXIMILES
YOUGOV
NEW VISTA LIVE

Also if you are shopping around to reduce utilities and interest, make sure you register for Quidco and Top Cashback for maximum value.

Not only that, (sorry bet you wish I'd stop!) you and your other half must start keeping spending diaries. Cut up the cards - it's terrifying I know. However, if you continue spending on them, things are about to spiral way out of your control. You are on the brink by the looks of it. Start using cash to pay for things - it changes your perspective.

Sorry all very harsh I know, but my feeling is you are about to tip over the edge financially.

Good luck xx

gargrave50

Just noticed the holiday is booked. I'm pretty sure you realised when you booked this that you couldn't afford it:o.

If you are about to tell me you are going to Florida again, then be prepared to add more debt to your credit card. Please tell me its all inclusive instead:rotfl::rotfl::rotfl:.

paulmapp8306

I dont think the Gas/electric is high at all. My Electric alone in a 4 bed is £140 - though I am in NI which is expensive, dont have duel fuel as we have no gas supply (use oil - so cooking is all electric). Id kill for £120/month all in.

You havent listed anything for TV licence though or Entertainment.

Petrol costs £240 - again not high if its for work. I spend £50/week as my commute alone is 17 miles each way per day - sometimes 6 days a week. I can see where that figure may come from.

Even so - and even for those who think your outgoings are too high - you still have £620/month disposable which is pretty good actually.

Make savings where you can - maybe a land line? not mentioned (cable?). Ditch one mobile? or go PAYG. Look at cutting groceries (though £100/week is fine as far as I can tell for a family of 4 - its about what mine is). If the holiday is paid for fine - DONT book another. That will save money longer term.

check your interest rates on your loans - only the Virgin one has a % listed. which ever is highest, pay off using you £600/month desposable. That would clear the Virgin (for instance) in 4 months. Start with the highest % interest rate debts. Paying minimum payemts just means most of your payments are interest and your actual debts dont reduce.

IF you could get interest frozen (or the 0% loans ARE 0%) you could have your debts cleared in 48 months - 4 years paying that spare £600/month. Even with interest, 6 years seems realistic even with no savings on your SOE. If you can make a little extra (partner earns more, cut the holiday, cut back on some little things) then 4 years of hurt will leave you £650+/month better off. Then you can start overpaying your mortgage.

When you say your mortgage interest is high - how high is high?