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Finally - deep breath - Zulu Dawn SOA

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  • lynzpower
    lynzpower Posts: 25,311 Forumite
    10,000 Posts Combo Breaker
    Zulu Dawn

    Im looking at this mate and I cant see where you are going to find over 600 pcm from - have you ?
    :beer: Well aint funny how its the little things in life that mean the most? Not where you live, the car you drive or the price tag on your clothes.
    Theres no dollar sign on piece of mind
    This Ive come to know...
    So if you agree have a drink with me, raise your glasses for a toast :beer:
  • Zulu_Dawn
    Zulu_Dawn Posts: 282 Forumite
    Part of the Furniture 100 Posts Combo Breaker
    I am so, so sorry about my quip above about the south of France etc. I've just re-read your first post, and you state quite clearly about the recovering addiction. Please excuse my thoughtlessness.

    Please don't worry about it Karma. In many ways I think I need to forget about the past and move forwards. I am now somebody with a very large debt who wants to do something about it. In fact I'm not going to mention my gambling past again on this website. I am going to tackle my debt from the bottom(cutting costs, selling assets etc.) and the top(finding new income streams etc.)

    My goal is to clear the lot in three years and end up with no debt and an affordable and manageable repayment mortgage that will enable me to own our property by the time I retire. That works out at improving my position by £3k per month.:eek: It ain't going to happen just by sacking the cleaner.

    I'm thinking about writing a book as my journey has been fairly interesting. Anyone got any other good (legal and decent) ideas?:think:

    I'm feeling positive. Thanks for all those who have contributed. If anyone else want to give me their view - I'm ready.


    ZD
    Debt free - achieved Jan 2021

    Mortgage free wannabe - started 15/10/21

    "No man is a failure who has friends"
  • plonkee
    plonkee Posts: 86 Forumite
    I see that you said that you don't want to stop your wife spending money because you feel that the debt is your fault. That might be true, but whats done is done. The facts are that allowing spending to go on will eventually result in losing everything and that will probably be worse for her than cutting back on her spending.

    You can do it if you cut

    Clothes back to £100 (from £200)
    Ironing/cleaning back to £0 (from £100)
    Gifts back to £100 (from £200)
    Shopping back to £295 (from £540)
    Health club back to £0 (from 55)

    That gives you £600 in savings which will at least allow you to make all your payments sustainably.

    I think that once you start cutting back, it will be easier to make further cuts. You can also whack in every bit of additional income to bring the debt free moment sooner.

    The other option is to sell your house and clear all the debts, giving yourself a mortgage repayment that is smaller than the level that you have now.
    thoughts on personal finance @ plonkee.com
  • Zulu_Dawn
    Zulu_Dawn Posts: 282 Forumite
    Part of the Furniture 100 Posts Combo Breaker
    The other option is to sell your house and clear all the debts, giving yourself a mortgage repayment that is smaller than the level that you have now.

    This is always there as a possibility. We want to fight this as long as I can. I would like to try and find a way of getting the people on the DMP to accept a little less and cut back by say £3-400 per month. This would ease things a little and enable me to keep my head above water without resorting to the overdraft facility.

    There is also always the possibility of me changing my job. I am quite senior and so finding a job that pays an extra £500 per month is not impossible. I also have a potential bonus going forward which might help.
    Debt free - achieved Jan 2021

    Mortgage free wannabe - started 15/10/21

    "No man is a failure who has friends"
  • pariskate
    pariskate Posts: 300 Forumite
    Part of the Furniture 100 Posts Combo Breaker
    Hi, I can't give a load of advice but just to say I have sympathy with your comments about you and your OH having got used to good food, clothes, personal care, gift giving etc. It's really hard to give these things up but often the desire to consume is replaced by an even fiercer desire to save (both money and the environment by re-using and recycling- think of your kids!). Maybe when your OH realises how deep in the doodoo you are she'll pitch in and help out. With your incomes and a real effort you have a great chance of getting debt free fairly smartish
    Kate
    Saving to pay the tax man
  • Pobby
    Pobby Posts: 5,438 Forumite
    Zulu
    have sent a pm.
  • Kaz2904
    Kaz2904 Posts: 5,797 Forumite
    1,000 Posts Combo Breaker Mortgage-free Glee!
    Zulu_Dawn wrote: »
    Hi All,

    I've been scared of doing this for nine months. I've finally plucked up the courage. Please don't be too harsh with me.

    Firstly a bit about me. I am married with two children at primary school. My wife and I both work.

    I am a recovering compulsive gambler and this part of my life has been going really well since my personal LBM last year.

    We live in a lovely big house. I suspect it is worth in excess of £500k but basically it is our home (as well as security for my wife and children). I have recently renegotiated our mortgage on a three year variable deal (1.75% below standard) and don't plan to move for a while if at all possible.

    My personal unsecured debt is astronomical (£146k). I am on a self-administered DMP and have managed to get interest frozen on all my unsecured debt. The minus sde of this is that I am paying back more than I can really afford. I also still have a loan with my bank but this has been kept as I have a substantial overdraft facility and one credit card which I pay off in full each month. I have never missed any payments on anything, communicated extensively with them all and have thus far received a relatively easy ride from my creditors.

    I am after advice in two areas. My current situation is potentially unsustainable and so I would be grateful for any help on how to proceed. I am currently slipping into overdraft or selling stuff/ earning extra each month to get by. Secondly I would like peoples views and opinions on my SOA. What stands out - what is good what is a no,no etc.

    The details are as follows. Everything has been averaged out. I should stress that this is what we have spent - not what we should have. We are getting better!

    INCOME
    My salary 4,400
    OH 1,100
    Child tax 120
    Sundry income 200
    Total 5,820

    EXPENDITURE
    Mortgage 2,030 (£333k outstanding)
    Council tax 221
    Electricity 90 (catching up as previously undercharged)
    Gas 63
    Telephone 25 (BT recently renegotiated)
    Mobile 30 (very old O2 contract)
    TV 11
    Water 25
    Car costs 125 (two old cars/insurance/MOT tax etc.)
    Petrol 174 (wife drives to work)
    Travel 65 (annual season ticket)
    Childcare 185
    Child clubs 100 (mainly piano lessons)
    Clothes 220 (all family)
    Food/provisions 540 (covers all supermarket purchases)
    Holidays 250 (committed before LBM - will not happen again!)
    Ironing/cleaning 100 (A luxury we can't really afford)
    Home insurance 28 (recently negotiated)
    Bank charges 12 (the price of a big overdraft facility!)
    Cash expenditure 200 (covers everything else - socialising etc.)
    Health club 55 (recently reduced)
    Gifts/presents 200 (unbelievable!!)
    Personal care 70 (hairdressing/Boots that kind of stuff)
    Total cost 4,819

    Available for creditors £1,001

    UNSECURED DEBTS
    Car HP agreement 282 (0% interest £4,515 outstanding )
    Bank loan 234(9% interest - £12,963 outstanding)
    11 Credit cards 826 (0% interest all in DMP - £85,800 outstanding)
    3 Other loans 260 (0% interest all in DMP - £42,300 outstanding)
    Monthly commitment £1,602
    Shortfall £601


    Running your current repayment through snowball calculator show that paying at your current rate you will be debt free in March 2015.
    My thoughts:
    Electricity will drop eventually!
    Telephone, very good but where do you access the internet?
    Mobile- try a new contract with a reputable firm who will let you earn cashback by buying online through quidco and look at their clearance deals. I use carphone warehouse and am setting up my new contract this week. They will end up paying me as I'm going to sell the new phone but even if I didn't I would get very few charges. It is a chequeback contract and that means paying (£30 for me) your contract every month and claiming back every 3 months by returning your bill.
    Car, echo again- do you need two cars? Not too bad if you need one regularly but if you don't could you juggle with wife or maybe hire one? (Don't know if it is cheaper)
    Clothes could be cut- you spend a lot but it is possible for kids to look smart wearing Tesco/Asda or sale clothes. I tend to buy jeans etc the year before in the sale but acknowledge that I am lucky to get a lot of hand me downs for my DS. I have found that since my DD started school in September she has not needed the same volume of clothes.
    For you adults I would suggest limiting yourselves to one key item- good quality each month. If you have been spending that amount then you must have clothes that you can uase for a while to stop spending. Socks can be bought cheaply.
    Food etc- If you are not able to cut costs switch to shopping online and go through Mr T, you could use one of the websites that tell you the points codes. If you open up multiple accounts then you could earn thousands of points each quarter. This doesn't sound like much but the points can be used for deals which are worth 4* their face value. You could then use the points to pay for a holiday every other year and maybe to pay for gifts. Mr T also has a wine club which you can earn points on. There are always money off codes around but I feel happier earning points because they have more valu compared in cash savings to your bill. If I have had a big shop to do which has meant I will use 2 codes worth of points I will pay for the second lot to be delivered rather than sticking it on one order because it is a better use of the codes!
    Ironing and cleaning- this can be kept up on by doing a little each and evry day. Hoover the middles of the rooms every monday and pick a room each week to spring clean. Dust as you walk around. Put washing in as soon as you walk through door in evening and dry it when finished. If tumbled iron and put away that night, if line dried do it the following night. By doing this you may well find that you cut the cost of clothees buying aswell because you will always have clean clothes and know what you have/need.
    Cash expenditure: divide it up between you, wife and family. Then no-one feels left out and you shouldn't go over.
    What do you get from the health club? Is it absolutely worth the money? Can the kids go or is it the only escape for the two of you? Weigh up the necessity- I would normally say to ditch it but understand your issues!
    Gifts- reasses- who are you spending £2400 a year on? I'm positive that this can be reduced without looking mean.
    Personal care: For boots or store shopping then set up an account with pigsback.com and start earning points to spend at boots and other places.
    Try getting your wife to go one week longer at first between appointments for her hair and to use a local beauty college for her nails/facials/colouring etc. Some people worry about this but I always think they are less likely to make a mistake because they are being supervised! How about letting your wife go on a pampering spa day once evry 4 months instead of having regular treatments- it may be available cheaper at your health club. Try to work out the cost because a whole day may work out cheaper than the little mounting up of bills each month and will feel a whole lot more special!
    Learn how to do home massage/facials etc so she doesn't feel too hard done by?

    Look at it this way- you are a very high earner and you are very committed to this. You may be drinking a little too much but do you think that this may have been linked to the LBM? You are going to do this by hook or by crook and I wish you all the best with your journey.
    Debt: 16/04/2007:TOTAL DEBT [strike]£92727.75[/strike] £49395.47:eek: :eek: :eek: £43332.28 repaid 100.77% of £43000 target.
    MFiT T2: Debt [STRIKE]£52856.59[/STRIKE] £6316.14 £46540.45 repaid 101.17% of £46000 target.
    2013 Target: completely clear my [STRIKE]£6316.14[/STRIKE] £0 mortgage debt. £6316.14 100% repaid.
  • Zulu_Dawn
    Zulu_Dawn Posts: 282 Forumite
    Part of the Furniture 100 Posts Combo Breaker
    Message to Kaz

    Thank you so much for your post. There are a lot of great things to go on and some wonderful ideas. I really appreciate it and will investigate a number of things you mention.

    A couple of small points;

    I'm lucky enough to get my home internet and mobile paid for by my company.

    My wifes mobile phone is definitely on the list of improvements to make.

    We have changed our gym membership from family to just my wife. I don't think she is ready yet to give it up.

    The wine bill is not really mine and we are both committed to reducing it.

    Gifts - yes this is unbelievable. I'm reviewing this but the bottom line is 25 childrens parties pa, Xmas and family all adds up. I don't think we ever spend more than £20-£25 on anyone other than the kids and each other.

    I think putting the cash in some kind of pot and sharing it is a great idea. We still pay for most thing by cards and this always divorces our expenditure from reality.

    Lots to think about.

    ZD
    Debt free - achieved Jan 2021

    Mortgage free wannabe - started 15/10/21

    "No man is a failure who has friends"
  • Kaz2904
    Kaz2904 Posts: 5,797 Forumite
    1,000 Posts Combo Breaker Mortgage-free Glee!
    I'm glad your net and mobile are paid for by work, I meant to add that I hoped you weren't relying on usage at work so that they could somehow put it in your reference or use it against you should you apply for a new job so phew!
    Wifes mobile, if it's an old contract have you tried phoning O2 to see what you can get out of them if she keeps the same phone? If nothing try a new cashback contract and sell the phone that gets you the most money, try envirofone.com
    I understand your issues with the gym and think that eventually your wife will come around, sometimes you just need to be gradual!
    With the wine bill I kinda meant that was it yours and DW's way of being able to deal with debt issues or has it always been that high and is it because you drink a lot or buy expensive wine? (I'm so nosey aren't I?).
    Gifts, think about who you buy for and why. I always buy in advance and get stuff throughout the year when it's on offer. My SIL and MIL love sanctuary stuff and it was on offer in boots 3 for 2 in 2005 so I bought their christmas and birthday presents and ended up with 2 female gifts. If I had known about pigsback then or had an advantage card then I'd be laughing! Just because the present is worth £20 it doesn't have to cost £20!
    Definately try the cash thing- it makes it so real to be actually spending money rather than handing over a card!

    I had a friend of a friend once who commented that when she had first moved out of home about 7 years previously she had got into difficulty within 2 months. She couldn't understand the switch card system and spent all of her money in 2 weeks. She said that from the second month of living on charity meals or going hungry she went to the bank on payday and withdrew all of her wages to the penny. She then split it into piles- rent electric gas etc. The rest stayed in cash in her flat and she could see how little she had left each day. Now obviously in this day and age where we pay for everything by DD it is harder but if I go to get petrol and the card lane has no queue I will use it and then put the cash in a separate part of my purse to be repaid to the bank account.
    Debt: 16/04/2007:TOTAL DEBT [strike]£92727.75[/strike] £49395.47:eek: :eek: :eek: £43332.28 repaid 100.77% of £43000 target.
    MFiT T2: Debt [STRIKE]£52856.59[/STRIKE] £6316.14 £46540.45 repaid 101.17% of £46000 target.
    2013 Target: completely clear my [STRIKE]£6316.14[/STRIKE] £0 mortgage debt. £6316.14 100% repaid.
  • Zulu_Dawn
    Zulu_Dawn Posts: 282 Forumite
    Part of the Furniture 100 Posts Combo Breaker
    With the wine bill I kinda meant that was it yours and DW's way of being able to deal with debt issues or has it always been that high and is it because you drink a lot or buy expensive wine? (I'm so nosey aren't I?).

    I don't want to overplay it. We don't really go out so have often enjoyed a glass of wine in the evening. I bottle a night between two for 20 evenings a month and you've spent £100. We just can't live like that any more.

    The bottom line is we have a good salary and live in a wealthy kind of world. Accustoming ourselves to this debt is something that is very hard. We have the worst cars of anyone we know, most of our friends go skiing in winter, big expensive holidays in the summer and a variety of short city breaks during the year. They are always doing new things in their house, buying furniture, decorating, spending lots of money on clothes.

    Sometimes I wonder if the best thing to do would be to sell up, pay everything off and rent and we would then be able to have the same kind of life as everyone else. I could rent a house like the one we live in for less than £2k per month, leaving us a further £1k per month to either save or spend. Plus I'd have a goodly amount sitting in the bank from the equity in our existing property.

    Then I could stop posting here and post on the "favourite holidays" or "best gadgets" websites!

    Trouble is in the words of Robert Redford at the end of the Sting - "I'd only blow it";)

    Best wishes


    ZD
    Debt free - achieved Jan 2021

    Mortgage free wannabe - started 15/10/21

    "No man is a failure who has friends"
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