Converting MoneySPENDINGExpert to MoneySAVINGExpert! Debt-busting mission (Take II)!

MoneySpendingExpert2011

Hi all,

Some may remember me from a little while ago.Was making good progress then fell off the wagon and went back to gambling, the rest is history. (I know I have been really stupid and wasted away hard earned money on gambling so please don't remind me about it).

I am going to try and get back on track, lets see where it takes me.

Thanks a lot!

Spending Expert!

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household.........
Number of cars owned....................

Monthly Income Details
Monthly income after tax................ 2400
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2400

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 650 (my rent is all inclusive)
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 15 (on PAYG, normally top up once every 6 weeks)
TV Licence.............................. 0 (included in the rent)
Satellite/Cable TV...................... 0
Internet Services....................... 0 (included in the rent)
Groceries etc. ......................... 125
Clothing................................ 15 (estimated for things like shoes etc)
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0 (travelcard, live in London zone 8 and work in Zone 1 - see below)
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 25 (asthmatic, wear glasses and terrible teeth)
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20 (guesstimate)
Haircuts................................ 10 (prolong it as much as I can)
Entertainment........................... 85 (try to keep it to a minimum)
Holiday................................. 0
Emergency fund.......................... 0
Charity........................... 50 (regular commitment, not something that I am going to reduce so please don't suggest it)
Misc........................... 10 (irregular expenses like personal care, postage etc)
Interest expense.......................... 125
Total monthly expenses.................. 1131


Assets
Cash.................................... 150
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 150

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
MBNA (0% BT)...............4700......50........0 (till oct)
Natwest (0% BT)............1925......30........0 (till aug)
Natwest loan....................6100......375.......17.8
Family Loan....................13770......0.........0 (need to start paying this off soon)
Natwest CC.....................700.......25........19.9(till oct)
Barclaycard....................2350.......50........26.9
Amex....................2825.......500........6.9
Overdrafts....................430.......0........16.9
Season ticket loan....................1700.......275........0
Total unsecured debts..........34500.....1305.......-


Monthly Budget Summary
Total monthly income.................... 2,400
Expenses (including HP & secured debts). 1,131
Available for debt repayments........... 1,269
Monthly UNsecured debt repayments....... 1305
Amount left after debt repayments....... -36

Personal Balance Sheet Summary
Total assets (things you own)........... 150
Total HP & Secured debt................. -0
Total Unsecured debt.................... -34,500
Net Assets.............................. -34,350

Tixy

Hi

Well there does not seem to be much you can reduce from your list of outgoings if you don't want to reduce the charity giving and can't reduce the entertainment further. I guess you might shave £25 off groceries and £10 off presents etc but these alone will not be sufficent to allow you to start repaying family.

I guess the £650 is fairly competitive for London?

Is the season ticket loan the travelcard? so would be an ongoing cost every year? Is the loan provided by your employer? and will they be happy to do the same in future?

Whilst it looks like you are almost meeting your reayment commitment, obviously when the 0% deals finish and if you need to start repaying you family you will be unable to do so.

MoneySpendingExpert2011 wrote: »

Unsecured Debts
Description....................Debt......Monthly...APR
MBNA (0% BT)...............4700......50........0 (till oct) have you worked out what the minimum will be from Oct?
Natwest (0% BT)............1925......30........0 (till aug) have you checked if the minimum will after aug go up and by how much?
Natwest loan....................6100......375.......17.8
Family Loan....................13770......0.........0 (need to start paying this off soon)
Natwest CC.....................700.......25........19.9(till oct)
Barclaycard....................2350.......50........26.9
Amex....................2825.......500........6.9 this seems a high payment?
Overdrafts....................430.......0........16.9 what is the limit of this? is the low point increasing each month?
Season ticket loan....................1700.......275........0
Total unsecured debts..........34500.....1305.......-

Is there a reason you are paying the Amex debt such a lot? is this really the minimum payment on that? It looks high, especially given the low APR.

Is there anyway you can increase your income?
Aside from that I think I would consider talking to a debt charity and discussing a DMP with them - although obviously this will have an impact on the family who you owe money to. And on the charity donations.

One potentially good thing about being on a DMP - is that you wouldn't have access to any more credit and so perhaps that might help you stay on the wagon?

edgex

MoneySpendingExpert2011 wrote: »

Groceries etc. ......................... 125
Clothing................................ 15 (estimated for things like shoes etc)
Medical (prescriptions, dentist etc).... 25 (asthmatic, wear glasses and terrible teeth)
Presents (birthday, christmas etc)...... 20 (guesstimate)
Haircuts................................ 10 (prolong it as much as I can)
Entertainment........................... 85 (try to keep it to a minimum)
Charity........................... 50 (regular commitment, not something that I am going to reduce so please don't suggest it)
Misc........................... 10 (irregular expenses like personal care, postage etc)
Interest expense.......................... 125
Total monthly expenses.................. 1131


Unsecured Debts
Description....................Debt......Monthly...APR
MBNA (0% BT)...............4700......50........0 (till oct)
Natwest (0% BT)............1925......30........0 (till aug)
Natwest loan....................6100......375.......17.8
Family Loan....................13770......0.........0 (need to start paying this off soon)
Natwest CC.....................700.......25........19.9(till oct)
Barclaycard....................2350.......50........26.9
Amex....................2825.......500........6.9
Overdrafts....................430.......0........16.9
Season ticket loan....................1700.......275........0
Total unsecured debts..........34500.....1305.......-


Monthly Budget Summary
Total monthly income.................... 2,400
Expenses (including HP & secured debts). 1,131
Available for debt repayments........... 1,269
Monthly UNsecured debt repayments....... 1305
Amount left after debt repayments....... -36

Personal Balance Sheet Summary
Total assets (things you own)........... 150
Total HP & Secured debt................. -0
Total Unsecured debt.................... -34,500
Net Assets.............................. -34,350

As already said,
£25 off groceries
£10 off presents
£50 off charity (you cannot afford it!)
£35 off entertainment

thats £120 per month


has the amex got insurance charges on it each month?
are you sure its only 6.9% apr?

MoneySpendingExpert2011

Thanks for the response Tixy!

Tixy wrote: »

Hi

Well there does not seem to be much you can reduce from your list of outgoings if you don't want to reduce the charity giving and can't reduce the entertainment further. I guess you might shave £25 off groceries and £10 off presents etc but these alone will not be sufficent to allow you to start repaying family.

You are right, reducing charity is a no-no... I already feel guilty that it is not higher but that's another story...

I think I might be able to shave off a few pounds from entertainment and like you suggested groceries and presents.

Tixy wrote: »

I guess the £650 is fairly competitive for London?

I live outside London and commute in, hence the extortionate travel card costs.

Tixy wrote: »

Is the season ticket loan the travelcard? so would be an ongoing cost every year? Is the loan provided by your employer? and will they be happy to do the same in future?

You are right the season ticket loan is for the travelcard and will be ongoing. The loan is indeed from the employer, the scheme has been in place for years and there is no indication that it is going to stop

Tixy wrote: »

Whilst it looks like you are almost meeting your reayment commitment, obviously when the 0% deals finish and if you need to start repaying you family you will be unable to do so.

That to an extent is a worry, I am hoping by that time I will have freed up the monies from AMEX and be paying that first towards the Natwest card and then MBNA.

Tixy wrote: »

Is there a reason you are paying the Amex debt such a lot? is this really the minimum payment on that? It looks high, especially given the low APR.

This actually is a charge card, repayable in full at the end of every month. I have been naughty and have found a way to keep shuffling the debt to keep the repayment to whatever I can afford that month. Hence the rush to get it paid off asap

Tixy wrote: »

Is there anyway you can increase your income?

I am considering ways of increasing my income, I have started ebaying, amazon, cashbacks, waiting to hear back on mystery shopping on weekends etc

Tixy wrote: »

Aside from that I think I would consider talking to a debt charity and discussing a DMP with them - although obviously this will have an impact on the family who you owe money to. And on the charity donations.

One potentially good thing about being on a DMP - is that you wouldn't have access to any more credit and so perhaps that might help you stay on the wagon?

I think DMP would be premature, wouldn't you say so? My reasoning is that I have 1250 - 1300 (net) to pay off the debts so about £15 - £16k per year. I should hopefully manage it all off in 2 years.

Thanks once again for the helpful tips

MoneySpendingExpert2011

Thanks edgex

edgex wrote: »

£25 off groceries
£10 off presents

Agreed

edgex wrote: »

£50 off charity (you cannot afford it!)

I take on board what you are saying, and you might be right but £600 per year is hardly going to make a dent to £35k debt. The figure is significantly less than what it should be!

edgex wrote: »

£35 off entertainment

Agreed, will be trying to reduce this further

edgex wrote: »

has the amex got insurance charges on it each month?
are you sure its only 6.9% apr?

This actually is a charge card, repayable in full at the end of every month. I have been naughty and have found a way to keep shuffling the debt to keep the repayment to whatever I can afford that month. Hence the rush to get it paid off asap

Tixy

MoneySpendingExpert2011 wrote: »

I think DMP would be premature, wouldn't you say so? My reasoning is that I have 1250 - 1300 (net) to pay off the debts so about £15 - £16k per year. I should hopefully manage it all off in 2 years.

Thanks once again for the helpful tips

I'd guess it will take about 3years to pay off.
I'd suggest if the £275 for travel costs is ongoing that you need to put that in your outgoings and reduce your debt accordingly - otherwise you won't be taking into account that you need to carry on paying it longer than 6months.

So you would seem to have £1269 - 275 = £994 for debt repayments.
Obviously it will depend on what the APRs jump to after the 0% and how little your family are prepared to accept a month - but making some estimates in a snowball calculator would give you around 36months repayment.

So it is quite a short time for a DMP - but if you cannot actually afford the repayments some months then you need to think about what options you have - as just keeping reusing credit to meet your commitments will definitely increase that 3year timescale.

MoneySpendingExpert2011

Thanks Tixy

Tixy wrote: »

I'd guess it will take about 3years to pay off.
I'd suggest if the £275 for travel costs is ongoing that you need to put that in your outgoings and reduce your debt accordingly - otherwise you won't be taking into account that you need to carry on paying it longer than 6months.

That is actually a good way of looking at it.

Tixy wrote: »

So you would seem to have £1269 - 275 = £994 for debt repayments.

I think I may need to redo my SAO, cause the last couple of months I have paid off £1,200 - £1,300 in capital each month.

Maybe I need to exclude the £125 i have estimated for interest costs

Tixy wrote: »

Obviously it will depend on what the APRs jump to after the 0% and how little your family are prepared to accept a month - but making some estimates in a snowball calculator would give you around 36months repayment.

15.9% and 16.9%, hoping for another 0% deal but am not overly optimistic

Tixy wrote: »

So it is quite a short time for a DMP - but if you cannot actually afford the repayments some months then you need to think about what options you have - as just keeping reusing credit to meet your commitments will definitely increase that 3year timescale.

Touchwood, I am able to make all the repayments on a monthly basis. I only keep shuffling the AMEX as it doesn't cost me anything and I don't want to increase the overdraft (it currently fluctuates between 0 and 500 every month). But I will keep the DMP in mind in case I need it

MoneySpendingExpert2011

As suggested I have now reclassified season ticket loan as being an expense rather than a debt repayment.

I have also monitored my cost for the month and reflected the spends in my SOA, I will try to make this a working budget - comments are welcome!

I have also made progress on the debt front - seems like debt free day is a long, long way away:o but I am making slowly but steadily! 1 month down, 26 to go!

PS: Comments I made about various categories (for example my rent being all inclusive etc) still apply

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household.........
Number of cars owned....................

Monthly Income Details
Monthly income after tax................ 2400
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2400

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 650
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 15
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 100
Clothing................................ 15
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 275
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 25
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 10
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0
Misc.................................... 10
Charity................................. 50
Total monthly expenses.................. 1220


Assets
Cash.................................... 180
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 180

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
MBNA (0% BT)...................4650......50........17.9
Natwest (0% BT)................1925......25........16.9
Natwest loan...................5830......375.......17.8
Amex...........................2325......600.......0
Barclaycard....................2250......100.......26.9
Natwest CC.....................675.......25........19.9
Family Loan....................13770.....0.........0
Total unsecured debts..........31425.....1175......-


Monthly Budget Summary
Total monthly income.................... 2,400
Expenses (including HP & secured debts). 1,220
Available for debt repayments........... 1,180
Monthly UNsecured debt repayments....... 1,175
Amount left after debt repayments....... 5

Personal Balance Sheet Summary
Total assets (things you own)........... 180
Total HP & Secured debt................. -0
Total Unsecured debt.................... -31,425
Net Assets.............................. -31,245

Confused_Assurance

Just a thought on the charity amount, and I do understand why you want to cotninue paying this. Have you thought about postponing this, to save the charity interest?

At the moment, you're facing a high interest rate on your loans. Which would the charity prefer:

£50 every month for 6 years or
£0 a month for three years, + £100 a month for 3 years + the interest you've saved?

Just a thought...

MoneySpendingExpert2011

Confused_Assurance wrote: »

Just a thought on the charity amount, and I do understand why you want to cotninue paying this. Have you thought about postponing this, to save the charity interest?

At the moment, you're facing a high interest rate on your loans. Which would the charity prefer:

£50 every month for 6 years or
£0 a month for three years, + £100 a month for 3 years + the interest you've saved?

Just a thought...

I totally appreciate what you are saying but then there is the following to think about:

would the needy who depend on the support prefer to have things like clean water and eye sight for their children now or in 3 years? bearing in mind the children could potentially be dead as a result of preventable diseases due to drink contaminated water?