It may not be a lot for some, but for me...!!

gilbertliddell

Hi,

I'm new to the MSE website and have been reading through the web site. I have always considered myself to be "bad" at handling my money and have realised it's time to get better at it. I downloaded the Money Diet Monthly Calorie Counter and I've included it below.

Recently I tried to change credit cards to a 0% deal but no-one will allow me to move to them. I currently rent a flat and have a mortgage of my own (I rent my flat out to someone).

I have 2 credit cards, one with Abbey (£4,000) and another with egg (£1200). I realise to some people this may not be much but it has been steadily increasing over the past few years and I don't want it to continue.

I'm looking for advice on how to lower my expenditure and get rid of these credit cards once and for all. Is remorgage an option (i may sell my flat which would solve the problem). I have no savings and constantly live in my overdraft..!!

Appreciated, G.



HOME
Monthly
Total
Mortgage / Rent £570.00
Buildings & Contents Insurance £11.00
Council Tax £75.00
Gas Bill £10.00
Electricity Bill £10.00
Home Phone Bill £4.00
Internet Bill £5.00
Mobile Phone Bill(s) £45.00
_______________________________________________
HOME TOTAL £730.00
_______________________________________________

INSURANCE
Monthly
Total
Mortgage Payment Insurance
Mortgage Term Assurance £20.00
_______________________________________________
INSURANCE TOTAL £20.00
_______________________________________________

EATS, DRINKS & SMOKES
Monthly Total
Food & Household Shopping £160.00
Eating Out £30.00
Drinking Out £50.00
_______________________________________________
EATS TOTAL £240.00 £240.00
_______________________________________________

TRANSPORT & TRAVEL
Monthly Total
Rail / Bus / Coach / Taxi £100.00
Car Insurance £42.00
Car Tax £13.33
Petrol / Diesel / Gas £40.00
_______________________________________________
TRANSPORT TOTAL £195.33
_______________________________________________

DEBT REPAYMENTS
Monthly Total
Credit Card Repayments £200.00
_______________________________________________
REPAYMENTS TOTAL £200.00
_______________________________________________

FUN & FROLICS
Monthly Total
Fitness / Sports / Gym £20.00
Cinema / Theatre Trips £20.00
TV Licence £3.33
_______________________________________________
FUN TOTAL £43.33
_______________________________________________

BIG ONE OFFS
Monthly Total
Cost of Christmas £8.33
Cost of Winter Holiday £75.00
Cost of Birthdays £8.33
_______________________________________________
BIG ONE OFF TOTAL £91.67
_______________________________________________

CLOTHES
Monthly Total
New Clothes £30.00
_______________________________________________
CLOTHES TOTAL £30.00
_______________________________________________

EDUCATION & COURSES
Monthly Total
Other Education Costs £80.00_______________________________________________
EDUCATION TOTAL £80.00
_______________________________________________

ODDS & SODS
Monthly Total
Haircuts £10.00
_______________________________________________
ODDS TOTAL £10.00 £10.00
_______________________________________________


Income
Monthly Total
Average Income From Employment £1,600.00
Other Income £270.00
_________________________________________________
MONTHLY INCOME TOTAL £1,870.00
_________________________________________________


TOTAL MONTHLY EXPENDITURE £1,640.33
TOTAL MONTHLY INCOME £1,870.00
_________________________________________________
DIFFERENCE £229.67
_________________________________________________

oops_a_daisy

Hi there Gilbert and welcome to DFW

well the good thing is that you have more money left at the end of the month to throw at your debts - I wouldnt recommend re mortgaging as you are securing more debt on your flat and will end up paying back more in the long run. If you are finding that you are overspending your budget start up a spending diary to show exactly where your money is going every month.

just a couple of things to look at - please can you check what your APR's are on your credit cards and add it to your SOA and also what is your overdraft and the interest charge on that ?

if you have an egg card can you get a 0% balance transfer onto that ?

you need to pay off the highest interest debts first whilst still paying off the minimums on your other debts then when the highest interest debts is paid off you then go onto the next highest and over pay that one and so on and son on... Check out this site to work out how long it will take to pay off your debts by using this 'snowball' method ( you will need your APR's for this )

some savings may be made on your expenditure - have a look at Money Saving Oldstyle for tips on budgetting and reducing your ourgoings on food.
Always shop around for insurances using links from this site and try to go through Quidco for cashback.

Just a few thoughts....Im sure others will be along soon with more advice

All the best and good luck - OOPS

helping_hubby

Well according to your sums you should have £229.67 left every month and so shouldn't be slowly getting into worse debt.

So you must be spending that £229.67 on things you don't realise. So how about keeping a very strict spending diary? For this to work you have to put every penny down, even a 35p newspaper, a 45p chocolate bar...

Your food shop? How many people is that for?

There are plenty of ways you can cut your expenditure...do you really need to eat out? Drink out? Can you invite friends to your for cheaper nights in?

Whats the reason for spending £100 on public travel? Seems a lot when you already have a car.

Can you give the gym up? You can run for free. Or invest in some home equipment. look on freecycle for exercise bikes. A trampette is great and costs just £15.

Cinema trips could potentially be free...are you signed up to pigsback? For 650 points you can get 1 odeon cinema ticket.

Hope that gives you some ideas.

immoral_angeluk

Hi and welcome to MSE. All though you may not feel like you have a lot of debt compared to some it's all relative to how much money you have coming in. We're in the same boat.. not massive amounts of debt but not a lot of money coming in either. Have had a quick look see over your SOA and these are the things that caught my eye...

HOME
Monthly
Total
Mortgage / Rent £570.00
Buildings & Contents Insurance £11.00 Is this the cheapest you could find? We pay £4.47 for our contents insurance..
Council Tax £75.00
Gas Bill £10.00
Electricity Bill £10.00 This is very cheap are you really only paying this much a month of gas and electric? If so what's your secret!
Home Phone Bill £4.00 What about line rental?
Internet Bill £5.00
Mobile Phone Bill(s) £45.00 This is a lot.. can you cut this down or go Pay and go so you can't use it as much?
_______________________________________________
HOME TOTAL £730.00
_______________________________________________

INSURANCE
Monthly
Total
Mortgage Payment Insurance
Mortgage Term Assurance £20.00 again is this the cheapest you could find? _______________________________________________
INSURANCE TOTAL £20.00
_______________________________________________

EATS, DRINKS & SMOKES
Monthly Total
Food & Household Shopping £160.00 For how many people? Check out the moneysaving old style board for ideas how to cut this down.
Eating Out £30.00
Drinking Out £50.00 Could you not get your friends round your house instead? Drinking in the house is cheaper.
_______________________________________________
EATS TOTAL £240.00 £240.00
_______________________________________________

TRANSPORT & TRAVEL
Monthly Total
Rail / Bus / Coach / Taxi £100.00 Would is be cheaper to buy a monthly/weekly pass?
Car Insurance £42.00 This seems high, is this the cheapest you could get? How much is your car worth? If it's under 1k it's better to just have TPFT cover.
Car Tax £13.33
Petrol / Diesel / Gas £40.00 If you do most of your travelling by public tranpsport could you get rid of the car? Would save you a lot of money every month.
_______________________________________________
TRANSPORT TOTAL £195.33
_______________________________________________

DEBT REPAYMENTS
Monthly Total
Credit Card Repayments £200.00 Can you break these down into balances, limits, minimum payments and APRs?
_______________________________________________
REPAYMENTS TOTAL £200.00
_______________________________________________

FUN & FROLICS
Monthly Total
Fitness / Sports / Gym £20.00 Personally I'd get rid of this. How often do you go? Is there a minimum term?
Cinema / Theatre Trips £20.00 Could you rent from blockbuster or something instead?
TV Licence £3.33
_______________________________________________
FUN TOTAL £43.33
_______________________________________________

BIG ONE OFFS
Monthly Total
Cost of Christmas £8.33
Cost of Winter Holiday £75.00 Do you really need a holiday every year? If so have you looked at cheaper options?
Cost of Birthdays £8.33
_______________________________________________
BIG ONE OFF TOTAL £91.67
_______________________________________________

CLOTHES
Monthly Total
New Clothes £30.00 Do you NEED new clothes every month? If so shop smart... don't dismiss charity shops or places like primark and tkmaxx...
_______________________________________________
CLOTHES TOTAL £30.00
_______________________________________________

EDUCATION & COURSES
Monthly Total
Other Education Costs £80.00_______________________________________________
EDUCATION TOTAL £80.00
_______________________________________________

ODDS & SODS
Monthly Total
Haircuts £10.00 Have you got a friend that could do your hair for you?
_______________________________________________
ODDS TOTAL £10.00 £10.00
_______________________________________________


Income
Monthly Total
Average Income From Employment £1,600.00 Any chance of increasing this with over time or a 2nd job?
Other Income £270.00
_________________________________________________
MONTHLY INCOME TOTAL £1,870.00
_________________________________________________


TOTAL MONTHLY EXPENDITURE £1,640.33
TOTAL MONTHLY INCOME £1,870.00
_________________________________________________
DIFFERENCE £229.67

lynnemcf

TV Licence £3.33. Why is this so cheap? I pay £11.37 a month.

gilbertliddell

Hi, thanks for the advice.

Firstly, your right, I never have that £229.67 at the end of every month so i'm obviously spending it on rubbish. Everything I listed on my expenditure sheet has been rounded up or is the exact amount (to avoid under estimating).

To answer your questions -

Your food shop? - Just me.

Eat out? - Is 2 or 3 meals out per month excessive?

Drink out? - I'm single so i'm out a fair bit.

Can you invite friends to your for cheaper nights in? I already do this.

Whats the reason for spending £100 on public travel? I take the train to work, it's the only way. I had thought of selling my car but I need it to get to the odd meeting, to 5 a side football and my snowboard club or do i need to be a bit more hard with myself?.

Can you give the gym up? - I'm not a member of a gym, the £20 is for 5 a side football and my snowboarding membership.

Cinema trips could potentially be free...are you signed up to pigsback? For 650 points you can get 1 odeon cinema ticket. - I've just subscribed to Orange wednesdays 2 for 1 tickets which will cut the cinema costs

I've never kept a diary of all my spends, i'm not a very organised person but i'll give it a try. One of my friends suggested using £200 of the £229.67 I should have left over onto my credit cards at the begining of the month, so paying £400 to my credit cards. He said if i've not got it, i'll not spend it on rubbish (cut the credit cards to ensure i don't use them)..??

Is this a good suggestion??

PS, thanks again for the quick replies.

helping_hubby

gilbertliddell wrote: »

Hi, thanks for the advice.

Firstly, your right, I never have that £229.67 at the end of every month so i'm obviously spending it on rubbish. Everything I listed on my expenditure sheet has been rounded up or is the exact amount (to avoid under estimating).

To answer your questions -

Your food shop? - Just me.
Approx £40 a week is quite a lot for one person. We're spending £23 a week for 2 people.

Eat out? - Is 2 or 3 meals out per month excessive?
No, not really. But you've admitted you're debts are slowly increasing and you asked for ideas.

Drink out? - I'm single so i'm out a fair bit.
Can you perhaps cut the drink down? Take cash with you and when it runs out it runs out?

Can you invite friends to your for cheaper nights in? I already do this.

Whats the reason for spending £100 on public travel? I take the train to work, it's the only way. I had thought of selling my car but I need it to get to the odd meeting, to 5 a side football and my snowboard club or do i need to be a bit more hard with myself?.
It's up to you. I don't think you've quite had your lightbulb moment. As you said your debts aren't as big as other peoples, but it won't be long before you're £20k, £30k, £40k in debt. It's great that you've realised now and it seems like you want to nip it in the bud, but you're not quite willing to cut down your lifestyle.

Can you give the gym up? - I'm not a member of a gym, the £20 is for 5 a side football and my snowboarding membership.

Cinema trips could potentially be free...are you signed up to pigsback? For 650 points you can get 1 odeon cinema ticket. - I've just subscribed to Orange wednesdays 2 for 1 tickets which will cut the cinema costs

I've never kept a diary of all my spends, i'm not a very organised person but i'll give it a try. One of my friends suggested using £200 of the £229.67 I should have left over onto my credit cards at the begining of the month, so paying £400 to my credit cards. He said if i've not got it, i'll not spend it on rubbish (cut the credit cards to ensure i don't use them)..??

Is this a good suggestion??

PS, thanks again for the quick replies.

I also wonder if you are under estimating some of your outgoings. I still say keep a diary or excel spreadsheet for a few months. This is the only way you're going to realise where the money is going.

Yes, putting that £200 straight on the cards when you get it is a good idea, but if you're not prepared to give up/cut back on things I think you run the risk of still spending this £200 and where will the money come from? A credit card or your overdraft?

gilbertliddell

Hi again, i'll explain in more detail


HOME
Monthly
Total
Mortgage / Rent £570.00
Buildings & Contents Insurance £11.00 Is this the cheapest you could find? We pay £4.47 for our contents insurance.. (I'll have a look into finding cheaper)
Council Tax £75.00
Gas Bill £10.00
Electricity Bill £10.00 This is very cheap are you really only paying this much a month of gas and electric? If so what's your secret! (I share a flat with 3 people)
Home Phone Bill £4.00 What about line rental? (thats my line rental split between 3)
Internet Bill £5.00 (this is actually £1.66, agin split 3 ways)
Mobile Phone Bill(s) £45.00 This is a lot.. can you cut this down or go Pay and go so you can't use it as much? (my internet deal is tied into my mobile phone deal, my contract is £35 but I usually spend about £45. The internet deal gives me free calls from my landline so the idea is to use that more and reduce my contract)
_______________________________________________
HOME TOTAL £730.00
_______________________________________________

INSURANCE
Monthly
Total
Mortgage Payment Insurance
Mortgage Term Assurance £20.00 again is this the cheapest you could find? (I didn't shop around, but I will now)_______________________________________________
INSURANCE TOTAL £20.00
_______________________________________________

EATS, DRINKS & SMOKES
Monthly Total
Food & Household Shopping £160.00 For how many people? Check out the moneysaving old style board for ideas how to cut this down. (this is just for me, should I limit to about £25 per week?)
Eating Out £30.00
Drinking Out £50.00 Could you not get your friends round your house instead? Drinking in the house is cheaper.
_______________________________________________
EATS TOTAL £240.00 £240.00
_______________________________________________

TRANSPORT & TRAVEL
Monthly Total
Rail / Bus / Coach / Taxi £100.00 Would is be cheaper to buy a monthly/weekly pass? (that is a monthly ticket)
Car Insurance £42.00 This seems high, is this the cheapest you could get? (yes, I have points on my licence) How much is your car worth? (about £4500) If it's under 1k it's better to just have TPFT cover.
Car Tax £13.33
Petrol / Diesel / Gas £40.00 If you do most of your travelling by public tranpsport could you get rid of the car? Would save you a lot of money every month. (this has crossed my mind but I have meeting to go to at work, 90% of the time I can go by train. I also snowboard and play 5 a side football and they are hard to get to on public transport and go through some rough areas)
_______________________________________________
TRANSPORT TOTAL £195.33
_______________________________________________

DEBT REPAYMENTS
Monthly Total
Credit Card Repayments £200.00 Can you break these down into balances, limits, minimum payments and APRs? (i'll find out and post back here)
_______________________________________________
REPAYMENTS TOTAL £200.00
_______________________________________________

FUN & FROLICS
Monthly Total
Fitness / Sports / Gym £20.00 Personally I'd get rid of this. How often do you go? Is there a minimum term? (football and snowboarding)
Cinema / Theatre Trips £20.00 Could you rent from blockbuster or something instead? (I will reduce or eliminate this cost)
TV Licence £3.33
_______________________________________________
FUN TOTAL £43.33
_______________________________________________

BIG ONE OFFS
Monthly Total
Cost of Christmas £8.33
Cost of Winter Holiday £75.00 Do you really need a holiday every year? If so have you looked at cheaper options?
Cost of Birthdays £8.33
_______________________________________________
BIG ONE OFF TOTAL £91.67
_______________________________________________

CLOTHES
Monthly Total
New Clothes £30.00 Do you NEED new clothes every month? If so shop smart... don't dismiss charity shops or places like primark and tkmaxx...
(I already shop at tk maxx etc but again, this is maybe excessive)
_______________________________________________
CLOTHES TOTAL £30.00
_______________________________________________

EDUCATION & COURSES
Monthly Total
Other Education Costs £80.00____________________________________________ ___
EDUCATION TOTAL £80.00
_______________________________________________

ODDS & SODS
Monthly Total
Haircuts £10.00 Have you got a friend that could do your hair for you? (I wish I had)
_______________________________________________
ODDS TOTAL £10.00 £10.00
_______________________________________________


Income
Monthly Total
Average Income From Employment £1,600.00 Any chance of increasing this with over time or a 2nd job? (my current plan is to sit my snowboarding instructor qualifications later this year and start teaching at my local club, I won't have to pay membership then and i'll get paid to teach, I used to work in a pub and could do that again however, I did find it hard working two jobs)
Other Income £270.00
_________________________________________________
MONTHLY INCOME TOTAL £1,870.00
_________________________________________________


TOTAL MONTHLY EXPENDITURE £1,640.33
TOTAL MONTHLY INCOME £1,870.00
_________________________________________________
DIFFERENCE £229.67


Thanks again for the advice........

mocolo

Hi there,

you do need to know where your money is going to get an accurate picture- eg. if you are using the remaining sum for bits of food , drink etc, then that takes your money food etc budget up a good deal. So the spending diary is a must first off. I would suggest that you might be surprised at the reality of your spends-not what you think they are. Well I was....
Of course you need a life and goingn out etc. is all part of it. But if you want to reduce your debt then you have to make decisions about priorities. You can still do what you want in essence like go out etc but there has to be some compromise, if you want to achieve your goal.
How do you access your money- do you take out what you need per week or as and when? For me, some degree of organisation is essential for me to keep on track. It is so easy to flick a fiver over for something without thinking about it.

For me your main area of potential easy saves is around food etc. but a spending diary is the first step....

good luck.

immoral_angeluk

To give you an idea for the food shopping, our family has 2 adults, a 2 yr old in nappies and a new baby on formula milk and we spend £180 a month on food/toiletries. I promise you you can cut down your food shopping. Try meal planning and only buying what you need to make meals instead of loads of impulse buys. Also don't be afraid of value food. Most of it is made by the same manufacturers of brand names but is just in less fancy packaging to keep costs down.

gilbertliddell

Thanks,

I will keep a spending diary as of today and look into where the small spends that add up are going.

I'll post back when I have a better picture of whats going on. Thanks.