Mr and Mrs K's New Journey to a Debt Free Life.

chevalier

Alex
Becoming debt free is rather like losing weight.
You can either become a yo yo dieter, whereby you are exceptionally 'good' for a while, lose some weight and then bounce back when you go back to your original diet. You then put the weight back on and often more.

Or you can change not just how much you eat, but also what you eat, add exercise into the mix etc, and lose the weight slowly. But when you do it this way, the weight stays off.

If you apply this to debt busting, which is the better approach?

Regards Mrs K - oh dear. All you can do is pay YOUR debts off. When (note I don't say if) you have paid them off, then you can talk to her again about getting hers sorted too. However I think in the end you may just have to have separate finances if your philosophies about finance don't start to come together more.

Well done on the ebay items. That is a positive.

As for the school thing, from over here, it seems to me that the more reasons people give for not going down the private route, the more entrenched you become that private is the only way. You are adding to your stress by worrying about how to pay for something. Your stress is already incapacitating your ability to do things that will help you (like more lovely pen listing). So let it go for now. Little K seems to be a bright spark, and they do well ANYWHERE. Especially with parents who want to be involved and are supportive of a good education.

You mentioned earlier about your thoughts of getting debt free, and then getting into the BTL game, and how impossible this seems now. Well I don't know what private primary school costs, but say 10k a year? More? So over 40k for 4 years. That is a good deposit for a BTL isn't it?

I wish you well Alex, people in your life aren't being very fair to you and that can't be any fun either.

chev

AlexLK

Hi Chev,

Thank you for your response. I am fortunately not quite so low today, perhaps it's just that acceptance of my situation is sinking in?

I can fully understand the dieting approach to becoming debt free, this is one of the reasons I don't simply want to sell the "stuff" without really sorting the real problem out. Unfortunately, even after this long I am still completely unaware where our money actually goes. Admittedly, my spending diary only counts for what I spend (which is very little now I have a very limited access to funds), nor do I manage to keep it daily or analyse it by the end of the month.

My wife and I cannot have entirely separate finances, due to the fact my earnings do not even cover half our bills, for the moment. I do hope this will not always be the case. Actually got a deal possibly going through at the moment.

My son's education is ultimately of greater importance to me than buying a house to rent out. He is bright (suppose I would say that ) and I am sure he would do well in most schools but I do not want him growing to realise I had something he didn't and wonder why I decided not to provide him with the same privileges my parents afforded me. Besides, my credit history is woeful, nor do I have the income to go down the BTL mortgage route.

pebbles88

Alex, even if you don't continue with the debt diary, you will always get support from all of us on here. I've posted at really low points, & the support here has helped so much.

X

maman

AlexLK wrote: »

Thank you for your response. I am fortunately not quite so low today, perhaps it's just that acceptance of my situation is sinking in?

Unfortunately, even after this long I am still completely unaware where our money actually goes. Admittedly, my spending diary only counts for what I spend (which is very little now I have a very limited access to funds), nor do I manage to keep it daily or analyse it by the end of the month.

My wife and I cannot have entirely separate finances, due to the fact my earnings do not even cover half our bills, for the moment. I do hope this will not always be the case. Actually got a deal possibly going through at the moment.

Glad to hear you're feeling a bit brighter today.:)


I'm just picking up on you being unsure where all the money goes. I seem to remember that you said you were still living beyond your means.


Keeping a very detailed spending diary is a very easy strategy for you to find out where your money's going. You simply keep all receipts and write down every penny you spend. You also seem to spend lots of bits of money on groceries which is potentially wasteful.


What I'm curious about is which 'your' do you mean and if you personally have no access to credit then how can you spend beyond your means? I haven't checked the figures but your spending on groceries and the odd coffee seem easily covered by your income from music teaching. Is this about borrowing from the business account?


I just remembered exorbitant amounts of money spent on fuel.:eek:


What exactly is your financial arrangement with MrsK? Do you have a budget planned to cover your mortgage, utilities, groceries and travel expenses? Do you pay a proportion each?


The reason I'm asking is that you can't control how MrsK spends her money but you can make sure you don't waste any of your own earnings. I don't see any recent evidence of this so how is the over spending happening?

AlexLK

pebbles: Thank you.

maman: Thank you for your post.

When I speak of living beyond "my" means, I generally mean we are living beyond our means. However, I do still find myself overspending and yes, it ends up coming out of the business account which I am aware needs to ultimately stop. However, I do not have access to the amount of money I used to (and I'm not just talking about credit).

A lot of the small places I buy groceries from do not give receipts and I often just tell places that do give receipts to put it in the bin for me. Old habits die hard, never used to keep a receipt unless it was for something in the thousands. I do not quite understand how everything can be bought in one shop for the week? A few people on here have said we would be better off not buying things here and there when we want them but buying everything in one big shop, unfortunately we have still not managed to achieve this even for one week. I am aware if we could do this it may curb the eating out which is still rather an expense; last week, I worked out we spent about £120 on eating out alone. This week a bit better at £45 (went out once). None of the eating out is budgeted for though.

I don't think our fuel bill is "exorbitant", we live in a rural area and use our cars on a daily basis. Mrs. K. Generally puts £70 per week in her car, I put £100 in mine (£50 comes out of the business and always has done as I use the car for business a lot) and the other cars usually have £30 put in them once every three weeks. So that's about £550 per month in total, not counting the business contribution. Admittedly, we budgeted £400 (if I recall correctly) on the SOA for fuel which we have found to be inaccurate. However, since we have been debt busting, I swapped my old petrol V8 Discovery for the diesel version. These people saying they only spend £100 per month on petrol are either deluded or use their car so little it's hardly worth having as they are only doing about 350-400 miles per month.

Mrs. K. has her wages paid to an account in her name now and pays enough money (topping up my salary) to cover our mortgage, utilities and food into our bank account, plus £200 which is meant to cover my fuel expenses but in reality it doesn't. She puts the rest of her wages towards her car deposit and the odd credit card purchase of clothes / holiday things (with the promise she will pay it off as soon as she's got the car). The only other money I have access to is my business account, for I do not see a penny of my earnings as all my income is taken up by our bills.

debtfreewannabe321

My fuel budget is £100 for a normal month, we have a gas guzzling 2.5l petrol engine and I take it to the shops to get a weekly shop and I probably use it 2-3 times a week on top of that. I'm not deluded and have come in on budget most months. Since going down the debt free wannabe road I've cut out every single non-essential journey by car to make sure we come in on budget as well. Perhaps you need to re-evaluate essential journeys and perhaps do one journey for several jobs. I find your attitude very negative and snobbish sometimes alex. In my opinion you should be thankful for everything you have, you have far more than most on here!

AlexLK

debtfreewannabe321: My comment regarding fuel was not meant to offend anybody. Nor do I see how it was negative or "snobbish"? We do use our cars a lot but both Mrs. K. and I use them for work, then we have family commitments and shopping trips as well. When the weather is nice, I walk to the post office or into the village which has little other than a post office and pub.

As for me having "far more than most", do I, really? I think not. My income likely only just about meets that of somebody working in a full time minimum wage job and I do not get any financial assistance from anywhere else, leaving me with absolutely nothing to spend on myself.

maman

I'd agree with essential journeys only to save on fuel. I do understand that when you live in a rural area you have to use the car more and obviously MrsK's work commute is essential but if you could try and do your shopping and get your fuel when you're out on business or taking little K to nursery then that should help.


Your eating out bill is shocking Alex. It's not that I don't like eating out but you really can't afford it. What you're spending on one meal is enough to eat at home for the best part of a week.


I'm assuming that the link with your food shopping is because you haven't got anything in for a meal. I wouldn't say you have to do all your shop in one place but just get organised so that you're not always buying bits and pieces and certainly not eating out rather than at home. A spending diary would mean that you had to remember what you'd spent long enough to write it down if you didn't have a receipt. While it's commendable to patronise small shops they generally charge more than larger ones. I find the actual act of keeping a spending diary acts as a brake to spending in itself. It would be a good challenge for you to live within the amount of money in your joint account plus your own income and not dip into anything else.


I shop mainly in Aldi and Sainsbury. It's certainly possible to get all I need for a week's meals in that one trip. I spend about £50 a week on food for two of us. It might cost more for three but as Mrs K isn't there for lunch and your Sunday lunch is free it shouldn't be too much more. I'm fortunate in that I'm careful with money because I want to be rather than because I have to be. It then frees up lots of disposable income for eating out and lots of holidays and anything else I fancy. You could be in that position Alex but you have to sort your debts out first otherwise you're just living on other people's money (by which I mean creditors and the people who have to pay increased charges to cover defaulters) and where's the pride in that.

AlexLK

To be honest, I don't really think about using the car, it's just "there" and always has been (had a car since I was 17 and not spent a day without one (even if it was broken, my mother would lend me hers before I had more than one). Anyhow, I have never really thought about when and how much we use the cars but we use them a lot and often not in conjunction with any other journey - food shopping is not done when son goes to nursery.

I am aware the eating out bill is not good . Usually we try to have dinner out once in the week but we've been not doing so well with this recently and you would be right about us often eating out because we have nothing in for a meal. Also, I have to admit both my wife and I are lazy when it comes to cooking.

Organisation has never been a strong point of mine. Well, tell a lie I'm actually rather good at planning and executing a specific project but cannot and have never been able to organise my life. I have made a conscious effort to try and become more organised in an effort to change our spending habits but have failed miserably. Whilst that would be a good challenge, I have no access to my income due to it going towards paying our bills, no excuses there. All I see once the bills have gone out is £200 for fuel, food is paid for in cash and my wife and I go shopping together these days. Perhaps this diary should be called "how to sort you life out" and the advice to be anything I do, you shouldn't.

When I first started this diary, we went to Aldi for some things but that went by the wayside early on as we didn't have time or forgot to make the journey. Unfortunately, unless my earnings change significantly I will not be in the position of having any disposable income as it is all eaten by our bills. Admittedly, there is no pride in living on other people's money.

brizzledfw

Hi Alex

Eating out is one of our great loves and before we had the LBM and it stayed on we spent (on average!! So do the maths!) over £600 PM on eating out..bonkers and I am not proud of it at all.

We have reined it way back in. Sure we do eat out sometimes but now fish & chips or pizza at our local pub, rather than a full blown huge meal out. All things in moderation as my grandfather used to say..it's like a diet, as the ever wise Chev has said, and too much of any one thing is a bad thing.

If we can do it, you can. You just have to want to.

Have a great weekend

Brizzle