I need to get a hold of this..!

fyggy

Hello all,

My husband and I are in some financial difficulties. As it stands we have two properties, one (mine) that we live in, but have outgrown and need to move out of and are being killed by management fees (£2800 pa now, from 1100 five years ago and we're unable to oust them...).

Our 2nd property is in his hometown of Bangor, N.Ireland which unfortunately has his useless brother on the deed/mortgage despite him NEVER paying a penny in the 9 years he's had it- whole different battle and my hubby is a soft touch. His little sister and bro in law rent it and that just about breaks even as in NI it's the landlord who is responsible for the rates (council tax). His house needs a fair bit of work but he havemt had the money to do this and so i dont know if it would rent on the open market. Ideally we want his sis & BIL to buy it from us and to break even would be fine. Other important thing to mention is that his house is on an INTEREST ONLY mortgage so nothing has been paid off and it's prob in a bit of negative equity. The mortgage has moved off the deal onto a standard variable rate and we wanted to try and get a better deal but it needs his brother to sign the deal too and he wants to do nothing, he has crazy ideas that there's 10k in it for him. Don't get me started.

My flat has lost a LOT. I bought it for £132,500 with a deposit of 50k and last check they are selling for 100k if lucky

Aside from our property issues. Our spending is so up and down. I got a real hold on it a few years ago but things have really slid in the last 12-24monts. We got married in Sept last year and took out a £11k loan to help fund this, but it didn't cover everything and come January this year we found we were maxed out on our overdrafts and credit cards with no 0% deals and massive charges & fees, so we did a consolidation loan of 13k.

At the moment, we have two loans and 3 credit cards with balances in them. I am making my final student loan payment this month so we will be £114 better off (not included on the SOA) and we have another 2 payments on our diving holiday to pay- until the end of August that takes us.

Work wise, we do earn good salaries, work full time shifts, we're both nurses. My husband got a promotion to Charge Nurse earlier this year, but it has actually meant we are 200-300 PCM worse off as he no longer works nights or weekends. I am a shop floor nurse and earn more than him, go figure. To try and make up for this I have increased the amount of night shifts I do from 5 to 7 per 4 week rota.

I do the finances and I know there is room for movement and to get rid of things:
-we hired a cleaner the month before the wedding as I was so busy so I couldn't keep on top of the housework. And now it's a luxury having her every week.
-We are both very focused on our health and fitness and do a lot of running, 5ks, lifting, muscle building, toning etc etc. I have lost 11kg (22lbs) & 50cms in the last 12 months in part due to my personal trainer, which we used to share, but now I just have him on my own and I also do pole fitness twice a week. I pay ,y PT £150 a month and have 2x a week and pole is £40 PCM for an unlimited pass - I go 2x p week. I just don't go to the gym on my own unless I have my PT, and my hubby's not keen to 'train' me nor do our shifts marry up to allow this. He's not made as much progress both in weight loss and strength/fitness as I have, so focused on himself.
-other smaller items are our wine club. We pay in 25 PCM which gives us 30 credit and we save it up generally until we've enough for a case of champagne.
-our leccy bill is high. Always has been. The developers put a strange system in these flats. I have switched supplier 4x and changed from economy 7 to 10 to a normal meter. My monthly dd has just increased from £87 to £123 and I rang to get that down £15. I'm on a good fixed deal Martin recommended last year. No gas. No oil.

Other strange figures are the fees we pay - we need indemnity insurance and have to each pay £100 pa to renew our registration. We both pay into the nhs pension which is in the process of going up and changing. It's increased 1% this April in line with our 1% pay increase- first in 3 years.

Anyway, I've rambled on long enough, below is my SOA. We have outrageously high outgoings.


Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 1980
Partners monthly income after tax....... 1550
Benefits................................ 0
Other income............................ 330
Total monthly income.................... 3860

Monthly Expense Details
Mortgage................................ 454.5
Secured/HP loan repayments.............. 391.29999999999995
Rent.................................... 0
Management charge (leasehold property).. 200
Council tax............................. 89 (12 month installments)
Electricity............................. 123
Gas..................................... 0
Oil..................................... 0
Water rates............................. 28
Telephone (land line)................... 20.82
Mobile phone............................ 80 (my contract til Dec 25th, Hubby's til Mar, already downgraded both)
TV Licence.............................. 12.12
Satellite/Cable TV...................... 52.75 (downgraded to get rid of Sports & 3D)
Internet Services....................... 28 (Home broadband plus 3G data browsing on each of our iPads)
Groceries etc. ......................... 200 (Switched to Lidl weekly shops plus bi monthly protein powder orders)
Clothing................................ 0
Petrol/diesel........................... 120 (Hubby's car more efficient, I use his as much as poss- diesel)
Road tax................................ 28
Car Insurance........................... 77.46
Car maintenance (including MOT)......... 10
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10.4
Pet insurance/vet bills................. 12.69 (Cat insurance)
Buildings insurance..................... 0 (Covered in service charge)
Contents insurance...................... 16.23
Life assurance ......................... 22.68
Other insurance......................... 16.67 (Yearly registration fees)
Presents (birthday, christmas etc)...... 40
Haircuts................................ 110 (High maintence and ever changing hair colour for me )
Entertainment........................... 200 (£25 each p week)
Holiday................................. 100
Emergency fund.......................... 4
Health & fitness........................ 190
Wine club............................... 25
Gadget insurance........................ 7.87
Hubby's subscriptions................... 31
Cleaner/household products.............. 100
2nd property rates (c.tax).............. 92.72
Professional Idemnity fees.............. 32.48
Total monthly expenses.................. 2926.69


Assets
Cash.................................... 0
House value (Gross)..................... 145000
Shares and bonds........................ 0
Car(s).................................. 8000
Other assets............................ 0
Total Assets............................ 153000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 70000....(454.5)....4.1
Hire Purchase (HP) debt ...... 1395.....(155)......0<(9 payments)
Hubby's house-rented...........59870....(236.3)....4.5
Total secured & HP debts...... 131265....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Santander CC...................861.5.....20........0 (til March 2014)
AA CC..........................3645.58...25........0 (1.5k til March 2014, rest til July 2014)
Capital One CC.................256.81....15........0
Diving holiday.................800.......400.......0
Yorkshire Bank Loan............12000.....352.4.....6.8
Nationwide BS Loan.............10000.....269.5.....5.1
Total unsecured debts..........27563.89..1081.9....-


Monthly Budget Summary
Total monthly income.................... 3,860
Expenses (including HP & secured debts). 2,926.69
Available for debt repayments........... 933.31
Monthly UNsecured debt repayments....... 1,081.9
Amount short for making debt repayments. -148.59

Personal Balance Sheet Summary
Total assets (things you own)........... 153,000
Total HP & Secured debt................. -131,265
Total Unsecured debt.................... -27,563.89
Net Assets.............................. -5,828.89

Created using the SOA calculator at https://www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using Firefox browser.

I know I have a long way to go and changes to make. I hope to sort this out!

R_P_W

Don't want this to sound harsh, but think it will. You are living well beyond what your incomes can support! Even assuming you have captured everything you spend (which probably haven't because we all miss stuff unless your tracking every penny) and paying minimums on the credit cards your spend 150 more than you earn every month!

Positive is you have stuff you can cut easy!

Cleaner 100 - sorry but lots of people have very busy lives and live without such a luxury - especially as it sounds like you live in a small flat?

Personal trainer 150 - you can't afford this

Haircuts 110 - cut this in half

Subscriptions 31 - magazines? If so cancel

Wine club - cancel

Sky - cancel

That's 370 a month saved to out towards debt!

miketaff1408

Protein shakes - cancel. Complete waste of money for the average person. Makes me shake my head when you walk into a gym and see all these people with their shakers mixing one up after their session!
For the average Joe they will do very little. Professional athletes - yes, but going to the gym twice a week? No need. Just adjust your diet with more eggs, chicken etc instead of carbs.

Entertainment budget could be trimmed as well if you really wanted to knuckle down.

And unitl you get your finances under control, holidays are a luxury you cannot afford.

John1993_2

Others will have specific examples for you (and I'll try to chip some in too), but I think that you need to take a look at the overall picture that your situation paints, too. You seem to want the accoutrements of a life that a couple on your income simply cannot have, without severe problems building up (as you've seen).

An important point is that you are NOT on particularly high salaries, you are both on reasonable ones, but they are not enough to support the life that you are trying to live. You are going to have to accept, I think, that the life that you want to live is just not available to people on your level of income. You'll need to find a way to get a far better wage if you want to live like a couple on £100k pa.

Anyway, specifics...

Don't believe the marketing in fitness magazines, read the actual research about how much protein you need per day on your regime, and in the (unlikely) case that you don't get it from your normal diet then find a cheaper way to get extra. Don't blow money on supplements that have no science behind them.

Drop the haircuts, you can get good haircuts for far less than that.

Cancel Sky, cancel the wine club, drop the personal trainer.

You are earning enough that if you cut your expenses back to sensible amounts you'll have enough left over to start clearing your debts, so please don't feel that it's hopeless. Live like a couple on £30k, not £100k, and progress is inevitable.

fyggy

Thanks for your replies. I expected harshness/brutal truth so it's all good thanks.

In reply to your suggestions-

Haircuts- Realised I put this in wrong, it should be half of that as I've cut back to every 8 weeks

Wine club- agreed, cancelled it before I've replied

Cleaner- I think we will drop her, but I'm such a soft touch I feel bad for her as we've got to know her pretty well over this last near year. Need to agree this cut with my husband.

Holiday- nearly paid off now, one month to go and then 400 better off a month- his sisters rent will actually be ours. We've been paying for it since last Dec.

Hubby's subs- these consist of 6 Netflix, 7 equifax, 8 World of Warcraft and the rest is equivalent of his two monthly magazines. I've cancelled mine. He has very little things and doesnt ask for much/spend much, so I don't want to deny him those.

Protein- Ive added this in as I was still losing weight beyond my goal weight and working out lots. Yes I do twice with PT in the gym, but I also run 3-4x a week, pole x2 a week, yoga. I'm doing a Tough Mudder in Sept, we both are, and I've seen improvements in my strength and muscle mass since upping my protein intake. I got 2.5kgs for £20 and it'll last me I think 2months. It makes for a good "meal" when needed as I work 13hr shifts so its easy to grab and throw down my neck. I eat a clean diet. I'm also veggie not that it's very relevant. I do 5 meals a day. I have switched to a cheaper brand, last one was £45 for 2kgs so Ive saved there. I think I'll keep the protein for now.

-PT is again something I'm not wanting to budge on. He has done amazing things with me. I don't think you can put a price on health but yes I realise our finances aren't that great to support this. I may consider reducing to once a week but only if hubby will train me, which he's not wanted to in the past but he also wants me to cut PT.

Sky- I think I'd be happy to cut this even more, but I shall set hubby on it and see what deal he can haggle. He does this every 6 months. I think Movies can deffo go next. Tho I don't think hubby will be happy about this, but then he's got Netflix so plenty movies on there.

Re the credit cards- this is after a shuffle around. I moved a few balances across to 0% deals on the two cards. The outstanding balance is from visiting our best friend last month in Guernsey. So that is the priority. Prior to the move around I was paying £100 off the Sanatander, which has come down nicely from 1200. I think I'd like to put 100 min against each card (AA & Santander).

The loans are due to finish Jan 2016 (this is the 352 one) and March 2017 (269 one). Ages.

I should be getting £2.5k from my Great Uncle in the next few months. Where do you think I should put it?

Again, thanks for the replies.

[Deleted User]

I'm not going to comment on the details in your SOA, as others have done so already, but I will emphasise that you need to reduce your spending to AT LEAST break even every month - at the moment your SOA suggests that you are getting into debt further (by £150) every month. This should be your priority, and I'd suggest that you address it fairly urgently!

Stop spending on Credit (CC's loans, O/D's etc).

As for the £2,500 coming your way soon. The general rule it to put any debt overpayment (ie above minimum payment) towards the debt that is costing you the most in interest every month. As things currently stand, it's likely to be one of the loans (but when paying extra off loans make sure that there's not any additional charge, Early repayment charge, or administration fee that would make this less worthwhile). But, given that you also have CC debt, it might be worthwhile over paying on this before tackling the loans as if/when they start charging interest it is highly unlikely to be anything as attractive as the lower interest rates charged on loans. So personally I would completely repay your Capitol One and Santander CC's (and cancel them), and then put the rest towards the AA CC along with what you were previously paying as minimum to Capitol one and Santander - so effectively snowballing them.

Also, take a look at the snowball calculator on the website where you filled in the SOA.

HTH,

D9

John1993_2

fyggy wrote: »

-PT is again something I'm not wanting to budge on. He has done amazing things with me. I don't think you can put a price on health.

No, but you can put a price on a personal trainer. I spend a lot on gym memberships (£280/month, one near the office, one near home), but would not do so if I was not earning enough to easily afford it. You know what your trainer gets you to do, so do it without him or her.

Health is also not the same as muscle definition. Have a waist half your height or less, do a decent amount of CV work, and eat a healthy mixed diiet, and that's you sorted in terms of actual health outcomes that you can affect.

It's your money, and going to be your choices, but you aren't living a little bit beyond your means, you are living a very long way beyond them, and you are going to need to make some major changes.

cats2012

I'm sorry but it really doesn't sound like you're very willing to tackle this.

There are some really obvious things to reduce, even if you don't cut. How about cleaner once a month or once a fortnight, PT once a week or once a fortnight and protein intake down by half? That's loads saved already!!

wannabee_in_credit

I remember the first time I posted my SOA up here. I felt like people were slating me, and I felt like I needed to make excuses for everything that I had on there. Fact is, people were being honest, and once I realised that then I knew I'd had my true lbm and started seriously trying to clear my debts.

I don't think that you've had your real lbm yet. You remind me of me... 'Oh, but I have to have the full Sky package because I have nothing else in my life' etc etc.

Simple fact is, that you can't afford a lot of the stuff you're paying for. I would love a cleaner - in fact it's high on my list of things I will do when I am debt free, but I ran up debts over £25k - spending other people's money thinking I'd pay it back 'later'. And now here I am, paying back and not able to afford the luxuries I thought I needed. Sorry, I know it's hard but you don't need subscriptions, movies, personal trainer, protein powder, cleaner etc.

You'll know when your lbm truly hits - and I wish you luck for it. It's a really good feeling paying for things because you've saved up for it rather than putting it on credit (we got married last year for just less than £6k, without resorting to credit at all). Meantime, you need to make cutbacks and break even otherwise your debts will only continue to get worse.

Good luck - I know I probably sound hard but it's just honest.

neverdespairgirl

fyggy wrote: »

Secured/HP loan repayments.............. 391.29999999999995
Telephone (land line)................... 20.82
Mobile phone............................ 80 (my contract til Dec 25th, Hubby's til Mar, already downgraded both)
Satellite/Cable TV...................... 52.75 (downgraded to get rid of Sports & 3D)
Internet Services....................... 28 (Home broadband plus 3G data browsing on each of our iPads)
Groceries etc. ......................... 200 (Switched to Lidl weekly shops plus bi monthly protein powder orders)
Clothing................................ 0
Petrol/diesel........................... 120 (Hubby's car more efficient, I use his as much as poss- diesel)

Presents (birthday, christmas etc)...... 40
Haircuts................................ 110 (High maintence and ever changing hair colour for me )
Entertainment........................... 200 (£25 each p week)
Holiday................................. 100
Health & fitness........................ 190
Wine club............................... 25
Gadget insurance........................ 7.87
Hubby's subscriptions................... 31
Cleaner/household products.............. 100

I know I have a long way to go and changes to make. I hope to sort this out!

When you are earning a decent salary, it's natural to want some treats, do things you enjoy, buy things you want.

But you need to decide what is a priority - and the above shows a huge number of over-spends on luxuries, to my mind. I'm sure your SOA isn't complete, either - £0 for clothes - really? No new clothes / shoes / etc at all? No shampoo, make up, all that sort of thing?

You're spending £180-odd a month just on phones and TV, a vast amount on hair care, huge sums on personal fitness, £25 a month on wine, £100 on a cleaner, nearly £400 a month on holidays / presents / going-out / entertainment, and you clearly also spend large sums on particular items - both have i-pads, and expensive cars.

You just don't need a cleaner - two adults, one small flat, both working full-time, doesn't mean a cleaner.

You're living as if you're earning £75k each, I reckon. You say the flat's getting too small for you, but there's absolutely no chance of moving unless you seriously, seriously cut down.

My parents live on 15 times your joint income or more, and there's no way my mother would ever spend that amount on phones, or hair care!

I'd say you need to give each of you a budget - say £100 a month each - and that pays for the spending choices each of you wants to make - so you can have high-maintenance hair-cuts, or personal trainer, or entertainment funds, or presents / holidays, but not all of the above.

fyggy

Domino9 wrote: »

As for the £2,500 coming your way soon. The general rule it to put any debt overpayment (ie above minimum payment) towards the debt that is costing you the most in interest every month. As things currently stand, it's likely to be one of the loans (but when paying extra off loans make sure that there's not any additional charge, Early repayment charge, or administration fee that would make this less worthwhile). But, given that you also have CC debt, it might be worthwhile over paying on this before tackling the loans as if/when they start charging interest it is highly unlikely to be anything as attractive as the lower interest rates charged on loans. So personally I would completely repay your Capitol One and Santander CC's (and cancel them), and then put the rest towards the AA CC along with what you were previously paying as minimum to Capitol one and Santander - so effectively snowballing them.

Also, take a look at the snowball calculator on the website where you filled in the SOA.
D9

Thanks for this. I'll have a look at if there are any charges for overpaying the loans as this was my first thought but I agree it's unlikely we'll pay off all of the CC's before each of the 0% deals end so perhaps that might be a better option.

Thanks for all the other comments. I know we're overspending and I know changes need to be made. From Sept we will be £400 better off, added to £114 from next month as my final student loan payment comes out tomorrow.

Re the gym. Having two gyms would be a dream, haha. Currently we don't pay for a gym membership. Our building has a gym, pool, jacuzzi & sauna on the ground floor, hence the large service charge. PT spends have been cut already from £250 to £150.

Re clothes and toiletries. They come out of either our weekly pocket money and approx £4 a week in the groceries. Sometimes it is more than that as I'll stock up if they're on offer. The majority of my time is spent in uniform or gym gear tbh! But yeah I suppose they'll be clothes to add into the SOA, it just wasn't something I'd thought about as a monthly amount- something I will have a think on.

I managed to first negotiate down our joint AA car breakdown renewal and then used points I'd accrued on my CC to cover it, to the tune of £150 this month. Small victory. Our cars are finance free and not expensive as suggested by someone.. Mine is 12years old and very low insurance now I'm old and nearly in double digits for NCB. Hubby's insurance is a little more as he's not been driving as long. But he changed his car to a more efficient one both fuel wise and tax group wise 2 years ago and bought it from a friend when it was 3years old. Straight through MoT this year Car insurance is something I need to plan in advance for as normally I pay in full, to monthly, it didn't have the cash to this year so ended up paying about £100 in interest on top of the price. Being able to pay them in full next year definitely would be a goal for next year.

I am going to cancel one of the credit cards, it's a cash back one that we were using and paying off in full up until earlier this year, but now I think we're better dealing with cash only until we're got a hold on our spending. There's an annual fee (£24) so that's why I'm cancelling rather than just cutting up.

Thanks for the replies guys. I appreciate them