How to become debt-free?

FireWyrm

Sammywr wrote: »

Our Pet insurance is the least we can pay - it also includes £9.99 we pay to the vets a month which means we do not pay any consultancy fees or for yearly vaccinations. This was vital this year as we had to make several visits - what we have paid in the monthly fees so far still doesn't cover what we would have had to spend had we not had it.

Observation, pets don't need vaccinations every year beyond their initial set unless you kennel them for the holidays. It's a scam to extract money unessesarily. I suggest you rethink this. If your pets need to see a vet on a regular basis, perhaps you should reassess it's quality of life. Animals either live or die, they arnt like humans and we should not strive officiously to preserve them beyond what nature would have allowed.

Life insurance WAS a condition of your mortgage and until about 1990 was a condition of all mortgages. However, it is no longer a legal requirement. I suggest though that you sacrifice pet insurance in favour of life insurance in all cases.

NinjaSavingKat

FireWyrm wrote: »

£120 - £150 a month, I'm not kidding. It would solve allot of the OPs problems

Sorry, I've got to disagree with you here. They have a mortgage, this is money well spent to cover that in the event of a death. Dont get rid of this unless you absolutely have to. I know it doesnt look necessary now, but if you havnt got it....

With groceries I was very being kind. If they are new to this a reduction to £150 per month would be very hard. You can't simply stop eating to save, there are lessons to be learned about cooking wisely and hunting for bargains etc / Using AP instead of Tesco's / down shifting / freezing batches etc.. not everyone's cup of tea. And food is always the difficult one for people as its the one reduction / changes a person will notice the most...

Fair dos about the life insurance for mortgage... but so many insurance companies have "loop holes" in which not to pay out .. is your husband covered for work mishaps etc since you said you want it in case anything happens to him?

FireWyrm

NinjaSavingKat wrote: »

With groceries I was very being kind. If they are new to this a reduction to £150 per month would be very hard. You can't simply stop eating to save, there are lessons to be learned about cooking wisely and hunting for bargains etc / Using AP instead of Tesco's / down shifting / freezing batches etc.. not everyone's cup of tea. And food is always the difficult one for people as its the one reduction / changes a person will notice the most...

I wasn't suggesting they stop eating, honest. We eat, very well on it and extremely well on £200. It's not rocket science to reduce this. You just have to stop going to the big 5 supermarkets, I guarantee they can halve that £600 bill. More to the point, I don't believe that figure is even accurate. The OP should pay very close attention to the food bill over the next few months for a true figure. I'm almost certain their bill is much higher than they think adding to their woes.

sistafromanothermista

With every pet insurance policy i've ever had they ask whether they are upto date with all vaccinations.....

NinjaSavingKat

FireWyrm wrote: »

I wasn't suggesting they stop eating...

I guarantee they can halve that £600 bill..

More to the point, I don't believe that figure is even accurate.

I'm almost certain their bill is much higher than they think adding to their woes.

I know you weren't. I am just saying hitting it that hard when they are just starting out will be difficult. There is a little learning to be done along the way.

Halving it was what I was suggesting is the best place to start in my original post bar £50...

I think your last two comments are unnecessary. Sammy is new and getting to grips with things. Once she has caught the MSE bug the figures will be cleaned up ....that's if they need to be..

Onwards and Upwards Sammy... well done on your post and asking for help. That's the first big hurdle complete!

FireWyrm

NinjaSavingKat wrote: »

I know you weren't. I am just saying hitting it that hard when they are just starting out will be difficult. There is a little learning to be done along the way.

Halving it was what I was suggesting is the best place to start in my original post bar £50...

I think your last two comments are unnecessary. Sammy is new and getting to grips with things. Once she has caught the MSE bug the figures will be cleaned up ....that's if they need to be..

Onwards and Upwards Sammy... well done on your post and asking for help. That's the first big hurdle complete!

Sorry if those last bits sounded unfair, but it's the truth. Often new people simply don't realise how much 'incidental' spending is going on. The figure they have offered on the SOA is at best a ball park guess and I'd bet most of that money, it's actually way off the mark if they kept a spending diary. I consider myself to be pretty good at running a house, but in February last year I had £800 of 'unaccounted for' spending in one month alone...god alone knows how long I'd been doing THAT for. People lie to themselves when they use plastic (me included). Most of what it means to be a DFW is about changing mindset, I promise the rest will naturally follow.

NinjaSavingKat

FireWyrm wrote: »

but in February last year I had £800 of 'unaccounted for' spending in one month alone...

People lie to themselves when they use plastic (me included).

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I had £350 in October and am shocked....:mad:. You are right about the card. Cash should be alloted each week, withdrawn and stuck to. Handing over cash is a little more frightening as you see it deplete than using plastic. I have stopped altogether apart from petrol but even then its in a separate account and for ease as I am on a motorbike! ..

happycamel_2

Hi Sammy, I hate to say it but you seem to be finding excuses a bit. It's understandable but when you hit the limit on your borrowing your mortgage company won't listen to "but I needed it" excuses.

Talk to your phone company, tell them you are in financial difficulty and see if they will lower the tariff on the non work phone. Are you registered self employed, does the other phone go through as a tax deductible expense? Can you reduce your internet cost by using your phone provider?

You can't afford nursery unless you are earning more than you are spending in that time. So if it costs you £60 a month but you'd sacrifice £100 of after tax income then it's worth it, but if not you can't afford it.

My total water bill for two adults and two kids under two (so loads of washing) including sewerage is £80 a quarter. I believe meters can be installed for free. Talk to your water company and ask if they have a way of reducing your bill.

Your grocery bill is the big area to tackle and other than that keep a spending diary and write done absolutely everything you spend (cash, direct debit, credit card, the lot) and you'll soon find areas where you can trade down or cut back.

It isn't fun or easy, at least initially, but you'll have a huge sense of achievement and a greater feeling of security as you get on top of your spending and see your debts start to fall.

YORKSHIRELASS

Hi and welcome. It takes some guts to post your SOA on here so thats a good start! To go back to the title of your thread there is only one way to get out of debt for the vast majority of us and that is by making some major lifestyle changes.

There is a little room in your SOA to cut back. You could knock the £160 shortfall off your grocery bill for a start and that would put you in the black every month at least.

There do seem to be some gaps in your SOA though. Do you never buy presents for your kids? What about activities or clubs (depends on how old they are I guess). Do you not set aside anything for clothes, likewise the car MOT/service?

The first thing I would do is start keeping a spending diary, make sure you are checking your online banking every day and start some spreadsheets analysing your spending. You cant plan debt repayments going forward if you dont really know where you are now. Also seeing it honestly in black and white makes it real (well it does for me!).

If you have got a good credit rating then you should be able to get at least some of the debt on 0% deals. Then at least you can start reducing the balances instead of just covering the interest.

There is loads of good advice on here but it takes a while for it all to sink in and you need to get everyone in the family on board. It really is a question of making every penny matter and accepting that it might be a hard slog but it will be worth it one day.

Sammywr

My son isn't in a nursery but a pre-school. I get that is seems I am rejecting things, but I will not cancel my pet insurance - My pet is part of the family and I will not have him put down unnecessarily!!!! I find that completely barbaric that someone would suggest that and question your morals, therefore I will not follow 'advice' from someone I have no trust in! How can you even suggest that I have my pet 'put down'!!!!?

I realise most of our spending is in our monthly shopping bill, which I really need to reduce. This was the reason I came on here. How can I reduce it? My children are constantly asking for food, thankfully they eat really healthily and are incredibly skinny, but the healthy stuff is where the expense seems to lie - fruit & vegetables are way more expensive than junk. We can fill our fruit bowl one day and it will be completely empty the next, for example. Where can we buy cheaper products that aren't going to compromise our/our childrens health/wellbeing?

As for the PPs questions. No, there is no money set aside for presents/car MOT etc. Hence the massive credit card debt. The £600 is right, but we know that we have been flippant and it is this we have to reduce. I am trying to walk more to reduce diesel costs, though living in the countryside makes it much harder, and none of our family/friends live in the same county. We buy food as we need it rather than doing a weekly shop. Does it work out cheaper to do weekly meal plans - we tend to plan around what we have in. Laundry stuff we tend to buy in bulk when its on offer - in fact most cleaning products/toiletries are bought this way or we just use the cheapest products. We are trying to buy the supermarket economy products when we can too. My children have packed lunches at school also - how can we provide them a healthy packed lunch but keep costs down.

I dont understand how to reduce the water/sewage bills. A meter in our area has been proven to cost way, way more than the prices we pay. I'm not aware there are any tariffs that will reduce it - we are with Southern Water and South East Water. As far as I know we are on the cheapest tariff and there are no other companies we can change to - if someone knows any different then please share.

Please don't take all my answers to things as rejections to all your suggestions. Believe me I am taking everything on board, but my questions are really aimed at trying to do everything the best way we can.