Loads of Debt - Nowhere to turn

merlot123

Is your wife work going to be term time only? There are approx 13 weeks a year school holiday, so this needs to be factored in.

Consolidation is rarely the answer, reduce spending and try to get low balance cards are the way forward.

almondp

merlot123 wrote: »

Are you entitled to claim child benefit, your take home salary seems to be over the £50k allowed.

We're over the £50k - with both myself and my wife working - so I don't think we can get any further benefits.

almondp

merlot123 wrote: »

I see from your first post you owe your family approx £15k, where is this in the SOA?

I see you regularly go over your overdraft as you have high fees, where is the overdraft in the SOA?

More questions rather than solutions at this point, but really need full picture. Are all these debts personal and not business ones?

The £15k I owe my family isn't in the SOA - as I haven't started paying this back to them yet. They under stand I need to tackle my CCs first.

Overdraft isn't in the SOA - should it be? Shouldn't I pay that back last as it has lower fees? Although going beyond it is causing £50 - £100 of charges each month - which I REALLY need to get on top of.

almondp

merlot123 wrote: »

Ok, had a quick look at SOA.

Your grocery bill is high
Your mobile bills are far far too high
What's AV streaming? Do you really need it
I see you have Netflick and spotify - do you really need them (breaking bad is excellent though)
Gym membership is too high (I pay £25 per month and get use of all facilities for that, pool etc, it is a brand new council run one, but excellent)
£9.00 milkman, why? Use the supermarket?
Equifax - again Why?
Work lunches need to go
Boiler cover - is this really necessary?
Washing machine cover - you can buy a new one for a few hundred pound - put the £15 per month in an Isa
Birthdays- £60 - huge amount
Bank charges of a £100 is ridiculous, you need to address this urgently. Are you sure you cannot put your overdraft onto a low balance card and cancel the overdraft - instant saving of £100 per month

You have a very good income, you are spending it on unnecessary things at this time, once you paid the debt you can have the all singing and dancing mobile contract and gym membership, but for now reduce them to a reasonable amount.

Easier said than done though.
merlot123

I plan to cancel - Netflix, Spotify, Gym, Milkman, Equifax - so that's £85 already!

Boiler cover required - we've just had it fixed. And fixing it without the cover could and has cost hundreds.

Thanks

merlot123

Yes the overdraft needs to be in the SOA,

Your income alone seems to be over £50k a year, if this is the case you are not entitled to claim child benefit - you must notify them of your income otherwise they will send you letter.

I gave a link in a previous post, please look at it.

snowcat75

almondp wrote: »

Not harsh. Ask away!

My wife helps out in my web design business as a studio manager. It's good for her to know how the business works and where money comes from etc. It's good for me to have her support in the business. If it was any old job - then things would be different. We also get to use up her tax allowance.

Anyway, baby no.3 is on the way and by September we won't need a nanny because our youngest will be in Pre-school and our 4 year old will be in school. So we'll only need to pay around £600 for pre-school.

How's your business set up, sole trader, partnership, ltd company? Paying yourself(s) a high wage like it appears is going to be a very non tax efficient way of doing things, far better to draw less and work more of your expenditure into capital expenses , this is taking into account the business can realistically afford to pay as much in wages. I still ask however does you wife really Need to work? Possibly she could reduce her hours to reduce child care or arrange work around the children, if your using her wage for tax relief then there is no reason why she actually has to do the job. From a business perspective working for workings sake makes you a busy fool.

BillJones

almondp wrote: »

The £15k I owe my family isn't in the SOA - as I haven't started paying this back to them yet. They under stand I need to tackle my CCs first.

Overdraft isn't in the SOA - should it be? Shouldn't I pay that back last as it has lower fees? Although going beyond it is causing £50 - £100 of charges each month - which I REALLY need to get on top of.

Yes, it's quite important that you post up a full statement.

happy_bunny_2

almondp wrote: »

SAR?

is it worth ringing 3 credit card companies and asking for a rate reduction if they reduce the APR? Will they do this?

Subject access request. You write to them, send them a tenner, they send you everything they have on you.

That way, you can see when the rate rises were. Then take it from there.

Only way they will reduce the rate is if you have grounds for a complaint. E.g no opt out. Otherwise they are harming their profits.

chillpill

merlot123 wrote: »

Yes the overdraft needs to be in the SOA,

Your income alone seems to be over £50k a year, if this is the case you are not entitled to claim child benefit - you must notify them of your income otherwise they will send you letter.

I gave a link in a previous post, please look at it.

Sorry to be critical but this is not correct, as you are still entitled to claim Child Benefit irrespective of your earnings! I think what you're trying to say is that earnings above £50k will incur a tax charge (HICBC - "High Income Child Benefit Charge") equivalent to 1% of the child benefit income for every £100 above the £50k threshold (e.g. Income of £53k would incur a tax charge equivalent to 30% of the child benefit received). Some couples (even with earnings above the £60k level, where the tax charge would be equivalent to 100% of the child benefit received) are still better of CLAIMING the child benefit, as the child benefit is usually in the mother's name. So, for example, if the mother is a low earner who doesn't pay NIC's (e.g. a housewife), she would still be better off claiming the child benefit as doing so will automatically give her NIC credits towards her State Pension. To stop claiming child benefit in my example (because the other-half is a high earner) would mean the mother's state pension entitlement will be affected!! :-) Finally, I suspect the "Tax Credits" of £135 referred to in the SOA is, in fact, the child benefit income for two children (£20.50/wk for 1st child & £13.55/wk for 2nd child, totalling £136.20 every 4 weeks (the child benefit payment period). If so, you a right to advise that the high earner does need to advise HMRC.


http://www.hmrc.gov.uk/childbenefit/start/claiming/protect-pension.htm

[Deleted User]

With that much equity, I think your best option is to sell and rent for a while. Would clear all your debts and you can concentrate on improving on your credit report over the next few years. In that way you would be more attractive from a mortgage point of view.