I can't see how we'll ever be debt free & SOA

cats2012

Hi,

Just a few small ideas...
- Entertainment is too high I'm afraid
- Groceries is also high, try the old style board for great bargain and batch cooking ideas
- Do you need both cars? You're only spending £50 a month on petrol which implies they're doing relatively low mileage. When we got rid of our second one I was so shocked by how much we saved

More people will have better ideas too

megan01

clothbum-mum wrote: »

Here's the proper SOA. I think it's correct. I've had to group a few things together and put them under entertainment. I've also taken off the holiday.

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.................... 2

Monthly Income Details
Monthly income after tax................ 1000
Partners monthly income after tax....... 1800
Benefits................................ 134.8
Other income............................ 0
Total monthly income.................... 2934.8

Monthly Expense Details
Mortgage................................ 728.5
Secured/HP loan repayments.............. 124
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 80
Electricity............................. 40
Gas..................................... 60
Oil..................................... 0
Water rates............................. 35
Telephone (land line)................... 10
Mobile phone............................ 113
TV Licence.............................. 12.12
Satellite/Cable TV...................... 30
Internet Services....................... 10
Groceries etc. ......................... 360
Clothing................................ 20
Petrol/diesel........................... 50
Road tax................................ 18.66
Car Insurance........................... 77
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 268
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 10
Contents insurance...................... 8.68
Life assurance ......................... 47.99
Other insurance......................... 0
Presents (birthday, christmas etc)...... 43
Haircuts................................ 13
Entertainment........................... 200
Holiday................................. 0
Emergency fund.......................... 0
credit expert........................... 14.99
professional reistration................ 12.66
Total monthly expenses.................. 2386.6


Assets
Cash.................................... 0
House value (Gross)..................... 160000
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 161500


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 119000...(728.5)....3
Hire Purchase (HP) debt ...... 992......(124)......0
Total secured & HP debts...... 119992....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Visa card......................6300......186.8.....0
visa card......................200.......10........19.94
next directory.................550.......62........25.99
Argos card.....................600.......30........29.9
Total unsecured debts..........7650......288.8.....-


Monthly Budget Summary
Total monthly income.................... 2,934.8
Expenses (including HP & secured debts). 2,386.6
Available for debt repayments........... 548.2
Monthly UNsecured debt repayments....... 288.8
Amount left after debt repayments....... 259.4

Personal Balance Sheet Summary
Total assets (things you own)........... 161,500
Total HP & Secured debt................. -119,992
Total Unsecured debt.................... -7,650
Net Assets.............................. 33,858

Hi This might come across as horrible, but it's the only way I can put this. Your alcohol consumption takes up over 1/8th of your monthly budget. You need to change your entertaining habits into perhaps buying ingredients to make food , renting cheap DVD's, which add up to far cheaper than that amount you spend on alcohol Your body will feel better for it .

kazwookie

Mobile phone seems high, how many phone is this for and what type of contracts etc are they on?

thecornflake

Hi,

Sorry if this post doesn't read too well - I've gone back and edited bits a couple of times so it might jump around a bit and\or repeat things.

I took an interest in your post because our situation is similar to yours in terms of family and income. We have 2 kids, only I work but my earnings are pretty much the same as yours combined, i.e. 2800 and my wife gets 133 (I think) child benefit. Our rent is 900. We only run one car but the costs seem to be around the same as yours - probably different tax and petrol costs. However our council tax is higher at £160\month and our gas and electric is £115.

I joined here back around 2006 I think it was because we were in a very bad financial state, we owned a flat and had a mortgage plus 2 secured loans, tons of debt in credit cards and other loans, and didn't have a clue about how it all worked.

After a lot of work and a couple of really tough years at the beginning we're now in the situation where a lot of the debt has been paid off (although there's still quite a bit left yet), we don't struggle each month to pay the bills and I'm putting away at least 50\month into savings for unexpected costs. After that we still usually have around £500 free each month. Our debt repayments are around £450, all unsecured - we were very lucky to sell our flat just before the market crashed and have rented since then.

I still keep a monthly budget spreadsheet so I've compared it to yours to see what the differences are.

Our combined mobile phone bill is less, but then we only really pay the set contract cost, the contracts include large amounts of free texts and calls, and unlimited data. I don't know if the reason for yours being higher is call\text costs or if the contracts are just more expensive. I would check when your contract ends and see if you can get onto a better tariff then, also if this means changing providers use a cashback site. Also check for cashback if you stay and upgrade the phone - I got £100 via Quidco for staying with mine and upgrading when I was eligible to.

Your food bill is around £60 higher than ours and we don't hugely scrimp on food i.e. buy all own brand stuff, we do cook sensibly and make good use of leftovers though. We do a deal from the local butchers each month which is a big combination of joints, mince etc and freeze most of it.

We don't pay out for life assurance because I get it for both of us from my work benefits. I don;t know if you're paying over the odds, probably are if it came from your mortgage provider. Might be worth shopping around for that one.

Entertainment is a lot at £200 but I don't know what that covers, e.g. is it movie rentals, going out etc? It does sound like a potential area for cutbacks. I know what you mean about having to have some sort of "luxury" but you might have to adjust your views on that until you get yourself into a better position. Having been almost at the point of bankruptcy before, just being able to afford to spend a couple of quid on a Kindle book is a good thing for me

Other child related costs - if this is child support payments I guess there isn't a lot you can do about it.

With only around £200\month left over although it can sound a lot I know from experience that you only need a couple of unexpected things to come up and it goes easily. I think if you could manage to drop your outgoings by another £200 or so you'd give yourself enough breathing space to avoid missed payment charges and get on the way to paying off the debts. A lot of your debts look like ones where you can pay extra if you are able to so I'd recommend looking into the snowball method which I've found to be very good for getting debts paid off a lot quicker than just making minimum payments.

I also agree with what someone else said about spending journals - Although you've covered quite a lot that people often miss I suspect you've got little bits here and there that you wouldn't think of that soon add up. If I add non-monthly expenses e.g. car tax etc to my budget it's not that far off what you have so I think if you're really struggling then it could be you're spending more on the little incidental things than you think.

And keep working on your husband to cancel that credit check payment

I hope some of that helps.

FatVonD

clothbum-mum wrote: »

Yes, I thought of a third account for the bills but because we're up to eyes in it I don't know how to sort one out so that the bills are paid on time while my husbands contribution builds up, if you get what I mean?

If you pay your council tax over 10 months there will be no payment due in February and March so now is probably the best time to do it, then contact your council and ask to pay over 12 months next year (as per the new scheme) which will reduce the payments slightly thereafter.

What date to you pay your mortgage? I ask because I recently changed my date from 10th (which was roughly when I got paid when I was freelancing) to the end of the month which is when I get paid now I have a job. Because I called them mid month the next payment was the month after (so effectively 6 or 7 weeks after the last one.) It was for a larger amount for that one month (to take into account the extra days interest) but it might buy you a bit of time to get enough in a separate account to cover all your bills if you paid your wages in there too?

thecornflake

P.S. If you know a direct debit will definitely fail and you have time then just cancel it. You'll get a letter from the company asking you to re-set it up but you can pay the bill that month manually by debit card\cheque\payment slip, you were going to get a late payment charge anyway, but you'll avoid unpaid DD charges. And you can just set it back up for the next month.
The only time not to do this is if the company who the debt is with have it as a condition that you have one set up at all times (I can't remember who used to have this rule but they fined me once because they happened to check when I was in the process of changing bank accounts).

rising_from_the_ashes

Brilliant!

clothbum-mum 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.................... 2

Monthly Income Details
Monthly income after tax................ 1000
Partners monthly income after tax....... 1800
Benefits................................ 134.8
Other income............................ 0
Total monthly income.................... 2934.8

Monthly Expense Details
Mortgage................................ 728.5
Secured/HP loan repayments.............. 124
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 80
Electricity............................. 40
Gas..................................... 60
Oil..................................... 0
Water rates............................. 35
Telephone (land line)................... 10
Mobile phone............................ 113 Try phoning & asking if you can drop a tariff - nothing to lose! Switch to PAYG as soon as poss
TV Licence.............................. 12.12
Satellite/Cable TV...................... 30 Sorry not essential - switch to Freeview or Freesat
Internet Services....................... 10
Groceries etc. ......................... 360 You should be able to get £100 - £130 off this with some batch cooking / meal planning etc. Try the Grocery Challenge on the Old Style board - great friendly bunch, loads of tips & recipes (and families of 4 can manage on £200/month)
Clothing................................ 20
Petrol/diesel........................... 50
Road tax................................ 18.66
Car Insurance........................... 77
Car maintenance (including MOT)......... 0 Still need to incl a cost for parts - new tyres, exhaust, brake pads etc etc
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 268
Medical (prescriptions, dentist etc).... 0 Need figure in here
Pet insurance/vet bills................. 0
Buildings insurance..................... 10
Contents insurance...................... 8.68
Life assurance ......................... 47.99
Other insurance......................... 0
Presents (birthday, christmas etc)...... 43 Too high - cut to £25
Haircuts................................ 13
Entertainment........................... 200 Sorry this is way too high - cut to £50
Holiday................................. 0
Emergency fund.......................... 0 Need figure in here to avoid more debt if something breaks & needs replaced - suggest £50 until a reasonable sum is built up
credit expert........................... 14.99 Sit your DH down in front of the phone & get him to cancel this ... what a waste of money!
professional reistration................ 12.66
Total monthly expenses.................. 2386.6


Assets
Cash.................................... 0
House value (Gross)..................... 160000
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 161500


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 119000...(728.5)....3
Hire Purchase (HP) debt ...... 992......(124)......0
Total secured & HP debts...... 119992....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Visa card......................6300......186.8.....0 No 4
visa card......................200.......10........19.94 No 3
next directory.................550.......62........25.99 No 2
Argos card.....................600.......30........29.9 No 1
Total unsecured debts..........7650......288.8.....-


Monthly Budget Summary
Total monthly income.................... 2,934.8
Expenses (including HP & secured debts). 2,386.6
Available for debt repayments........... 548.2
Monthly UNsecured debt repayments....... 288.8
Amount left after debt repayments....... 259.4

Personal Balance Sheet Summary
Total assets (things you own)........... 161,500
Total HP & Secured debt................. -119,992
Total Unsecured debt.................... -7,650
Net Assets.............................. 33,858

Well the good news is that you should have a surplus - as others have suggested try a spending diary to see where the little bits disappear to (I will also say it's a total eye opener!)

There is room for some cuts so really this could go to the debts too - if you could put £500 towards the debts a month, you'd be clear of them in just over a year :T

datlex

Can I suggest two things?

1. set up a bank account for bills, including loan payments.

2. don't trust your bank statement!! Instead use a spreadsheet to track every time you either withdraw cash from your account or spend on your debit card or write a cheque. Making sure you start with a non allocated amount and deduct each amount from this. Make sure you fill this out everyday. You could keep it on google drive and update it on the go too, depending on how easily you can access the internet away from home.

[Deleted User]

clothbum-mum wrote: »

Mobile phones . . 113.00

How much? :eek:

That's got to be the highest Mobile phone charges, I've ever seen in an SOA.

I don't spend that on electricity, gas and water, combined.

Betty_Crumble

it is so doable, keep your chin up and make the cuts needed, you'll be there in no time

good luck