New and bit scared

[Deleted User]

David72 wrote: »

Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 1
Monthly Income Details[/b]
Monthly income after tax................ 2585
Partners monthly income after tax....... 1407
Benefits................................ 134
Other income............................ 0
Total monthly income.................... 4126
Monthly Expense Details
Mortgage................................ 877
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 136 - Is this over 10 months? If so, moving to 12 months will reduce it by £22-67pm.
Electricity............................. 84 - This seems high. Try comparison sites and/or always switching things off when not in use.
Gas..................................... 63 - As for electricity.
Oil..................................... 0
Water rates............................. 36
Telephone (land line)................... 10
Mobile phone............................ 44
TV Licence.............................. 12
Satellite/Cable TV...................... 32 - Dump this and go Freeview/Freesat.
Internet Services....................... 15
Groceries etc. ......................... 600 - £150pw is a lot, even for four people. You should be able to get this down by at least 1/3rd.
Clothing................................ 50 - Every month?
Petrol/diesel........................... 160
Road tax................................ 15
Car Insurance........................... 19
Car maintenance (including MOT)......... 50
Car parking............................. 5
Other travel............................ 0
Childcare/nursery....................... 82
Other child related expenses............ 30
Medical (prescriptions, dentist etc).... 20
Pet insurance/vet bills................. 19
Buildings insurance..................... 19
Contents insurance...................... 0 - You need this. It needn't be expensive.
Life assurance ......................... 56 - This seems a lot. Are you in a high risk occupation or something?
Other insurance......................... 31 - What's this?
Presents (birthday, christmas etc)...... 30
Haircuts................................ 20
Entertainment........................... 35
Holiday................................. 30
Emergency fund.......................... 0 - You need something in here.
Car loan................................ 234
Mobile phones........................... 44 - How many phones?
Tennis/cricket/ballet/gym etc........... 300 - This lot is costing you £3,600pa. Any way to reduce the number, or frequency, of the activities?

Total monthly expenses.................. 3158

Assets
Cash.................................... 0
House value (Gross)..................... 290000
Shares and bonds........................ 0
Car(s).................................. 8000
Other assets............................ 0
Total Assets............................ 298000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 260000...(877)......3.5
Total secured & HP debts...... 260000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................9983......253.......18.9
Santander credit card..........3598......90........23.9
MBNA credit card...............6960......163.......24.9
Next directory.................670.......63........18.9
Bank loan......................8413......425.......1.5
Tesco credit card..............3410......34........0
Total unsecured debts..........33034.....1028......-

Monthly Budget Summary
Total monthly income.................... 4,126
Expenses (including HP & secured debts). 3,158
Available for debt repayments........... 968
Monthly UNsecured debt repayments....... 1,028
Amount short for making debt repayments. -60
Personal Balance Sheet Summary
Total assets (things you own)........... 298,000
Total HP & Secured debt................. -260,000
Total Unsecured debt.................... -33,034
Net Assets.............................. 4,966

The Santander and MBNA cards are the real killers.

At your current rate of paying, the MBNA card is going to cost you over £9,000 in interest.

Any space on a lower or 0% card, you could transfer all/some of the balances to.

[Deleted User]

David72 wrote: »

Very tempting to accept, then cut up the card, having transferred the Santander balance and hopefully some of the MBNA or Barclaycard.

Transfer MBNA first, as it's the highest APR, albeit by only 1%.

I know 1% doesn't sound a lot, but at the rate you are currently paying MBNA, it's £1,242 extra interest.

David72_2

Thanks everyone. Especially MM - very similar! £85 per week it will be then. That used to easily be enough for a week's shopping before the price of everything went up so much. Or maybe I will start by setting a £450 a month budget then try and come down from there.

Have agreed with my wife to reduce the amount of tennis (sadly the LTA aren't any help - to get any funding you have to have travelled the country so hotel bills as well as the fuel and tournament fees - who said tennis was an elitist sport for rich people only?!?!?) and am going to have a sky conversation with my son tonight - will try to make it sound like a positive!

Also applied for the Santander card I mentioned earlier in my wife's name - hopeful of transferring much of the mnba balance.

Not crying now - taking positive action. Long way to go but one step at a time . . .

David72_2

Blimey Bob those figures are scary - thanks for the heads up.

tulip28

Think positively and the rest will follow. x

LannieDuck

Trying to think outside the box on the kids' activities:

* You have two children? But 4 activities listed... could they both keep one activity and cut down on the other? e.g. keep the tennis and ballet, cut down on cricket and gym?

* Could you put any money they raise from selling their old kit towards their lessons?

* Could you and your OH ask for money towards the childrens' activities this Christmas instead of presents for yourself? I know this might be a bit awkward to do and wouldn't cover the whole cost, but it might help.

* Would there be any chance your parents might be willing to cover the cost of the lessons for a year while you get your debts under control? I'm not normally one to suggest shifting responsibility for balancing your books onto family members, but this is a bit different from just getting them to pay your debts for you. If they have the means, grandparents are sometimes quite keen to pass their money onto the grandkids. And if it's for a set period of time while you get rid of the interest payments, it might help focus your mind to have a target deadline?

* Your son's 9, so possibly a little young for this, but would he have the confidence (and knowledge) to start tutoring some young kids during school holidays (possibly more of a suggestion for next summer)? Maybe his coach needs an assistant for kids' clubs or knows someone who does?

MoneyMission

David72 wrote: »

Thanks everyone. Especially MM - very similar! £85 per week it will be then. That used to easily be enough for a week's shopping before the price of everything went up so much. Or maybe I will start by setting a £450 a month budget then try and come down from there.

Glad I could be of use!
If you ever want an example of one of our weekly meal plans just PM me. Or, if you have a little time, wander over to the Old Style forums which is where I cut my teeth when I joined this board. Plenty of packed lunch and evening meal ideas on a budget over there. Those Old Stylers saved our bacon when we started on here due to a massive cut in salary brought on by redundancy.

johnthea

Hi David

if this SOA was accurate you would not be in 33,000 of debt? or at 60 a month it would have taken 45 years to accumulate this sum.

This is my opinion of what is missing from you real soa no offence is intended.

I think what you have done is a budget of what you think you should spend rather than a Soa of what you currently spend. im new to this forum but have been reading it for years. it is my understanding that the soa is to identify how you got into this mess so people can identify how to help you get out of it.

you have a combined gross salary of around 70k a year are the type of people who spend 300 a month on tennis lessons for your kids ie 3600 per year yet you honestly think you spend 360 per year on Christmas and birthday presents for the whole family that's 90 per year each for a family of 4?

420 per year on entertainment this works out to about 2 family meals out at an inexpensive family restaurant a couple of trips to the cinema and couple of trips to bowling or wherever.

do you and the Mrs not go out for at least a meal for your anniversary or some meals and drinks out with friends at least once or twice a year.

600 a year on cloths for a family of 4 including new tennis gear ballet shoes etc.

360 a year for holidays, do you every go on holidays?

i find it hard to think that someone who buys a 290k house on interest only does not spend far more on the above items thus allowing a 33k debt to accumulate. this debt did not accumulate at 60 per month and if you ignore the cause of the debt you will just keep going in this cycle of debt.

David72_2

Hi John

Yes I can see what you are saying. No offence taken.

We very rarely go out as we have young children (and are anti social!) but true I should have put in a bigger figure for clothes to include the sports clothes and more for christmas and birthdays. Point well taken.

I also ought to add that the mortgage has only just gone down to £877 a month since August when our fixed rate ended. It was £1230 a month before then. Easy to say it now but we overstretched buying the house in the first place, especially at a time when my wife was about to go on maternity leave and about to earn less.

My wife and I have agreed that we will need to downsize the house and I am seeing a mortgage broker on Monday to discuss. Unfortunately we also need to spend a little on the house to maximise its value and appeal, following the general wear and tear of 2 young children and a kitten.

In the meantime am selling all I can on e bay, keeping a spending diary and doing very careful meal planning. MM yes please to being PMd your meal plans! Have also taken away Sky sports and waiting to hear re the gas and elec switch. Still cheaper to keep Sky basic package as don't have an aeriel and would cost to get one fitted as well as the cost of the freeview box. Will keep an eye on this.

Got to keep at it.

tulip28

Are you feeling better today David?

You are taking all the steps and are doing really well so keep at it and remember we are all here for you anytime.