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Help with budget and want to pay mortgage off.....

TopCat1978
Posts: 40 Forumite
Hi all
I am new to this forum but I am after some advice. (I have posted in another section but it was suggested I post here instead!)
We are at the final stages of remortgaging to clear the large debts we have built up over the years. We are taking out more than enough to clear them all which is a relief. I know some people don't suggest remortging to clear debts but they were starting to get unmanageable to seemed the only option.
We have fixed for 2 years to give us some peace of mind what the payments will be for that time. I don't expect the rates to go up but it is fixed at 2.99% so didn't seem excessive compared to my credit cards which some were at 25.9%. Last month alone our interest was nearly £700 on our credit cards.
Anyway, this will be the first time DH and I will not have unsecured lending and have one monthly mortgage payment only so I am trying to set a budget to keep on top of our money and try to save to pay our mortgage off. Previously it was just buy what we wanted /needed with a credit card so I don't know what is reasonable.
We are a family of 2 adults and 2 boys (7&4) so what should be reasonable for food? Should we have separate accounts for food and petrol and then another for other bills? We do have a santander 123 account paying our dd's each month at the moment.
Any advice appreciated!
. Should I do a soa?
Xxxxxxx
I am new to this forum but I am after some advice. (I have posted in another section but it was suggested I post here instead!)
We are at the final stages of remortgaging to clear the large debts we have built up over the years. We are taking out more than enough to clear them all which is a relief. I know some people don't suggest remortging to clear debts but they were starting to get unmanageable to seemed the only option.
We have fixed for 2 years to give us some peace of mind what the payments will be for that time. I don't expect the rates to go up but it is fixed at 2.99% so didn't seem excessive compared to my credit cards which some were at 25.9%. Last month alone our interest was nearly £700 on our credit cards.
Anyway, this will be the first time DH and I will not have unsecured lending and have one monthly mortgage payment only so I am trying to set a budget to keep on top of our money and try to save to pay our mortgage off. Previously it was just buy what we wanted /needed with a credit card so I don't know what is reasonable.
We are a family of 2 adults and 2 boys (7&4) so what should be reasonable for food? Should we have separate accounts for food and petrol and then another for other bills? We do have a santander 123 account paying our dd's each month at the moment.
Any advice appreciated!

Xxxxxxx
0
Comments
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Yes, if you can, do an SOA, not only will it assist people here in giving you advice, it will also make you aware of what you are spending.0
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Hope this
Statement of Affairs and Personal Balance Sheet
\
Household Information[/b]\
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................ 2324.79
Partners monthly income after tax....... 500\
Benefits................................ 136.2\
Other income............................ 0\
Total monthly income.................... 2960.99
\
Monthly Expense Details\
Mortgage................................ 776\
Secured/HP loan repayments.............. 0\
Rent.................................... 0\
Management charge (leasehold property).. 0\
Council tax............................. 109\
Electricity............................. 175\
Gas..................................... 60\
Oil..................................... 0\
Water rates............................. 42\
Telephone (land line)................... 26.5\
Mobile phone............................ 80\
TV Licence.............................. 12.12\
Satellite/Cable TV...................... 52.5\
Internet Services....................... 7.31\
Groceries etc. ......................... 400\
Clothing................................ 100\
Petrol/diesel........................... 100\
Road tax................................ 20\
Car Insurance........................... 20\
Car maintenance (including MOT)......... 30\
Car parking............................. 0\
Other travel............................ 0\
Childcare/nursery....................... 0\
Other child related expenses............ 0\
Medical (prescriptions, dentist etc).... 30.94\
Pet insurance/vet bills................. 0\
Buildings insurance..................... 10\
Contents insurance...................... 10\
Life assurance ......................... 20.45\
Other insurance......................... 0\
Presents (birthday, christmas etc)...... 25\
Haircuts................................ 10\
Entertainment........................... 100\
Holiday................................. 20\
Emergency fund.......................... 100\
Total monthly expenses.................. 2336.82
\
Assets\
Cash.................................... 0\
House value (Gross)..................... 225000\
Shares and bonds........................ 0\
Car(s).................................. 5000\
Other assets............................ 0\
Total Assets............................ 230000\
\
\
Secured & HP Debts\
Description....................Debt......Monthly...APR\
Mortgage...................... 163995...(776)......2.99\
Total secured & HP debts...... 163995....-.........- \
\
Unsecured Debts\
Description....................Debt......Monthly...APR\
Total unsecured debts..........0.........0.........- \
\
\
Monthly Budget Summary\
Total monthly income.................... 2,960.99\
Expenses (including HP & secured debts). 2,336.82\
Available for debt repayments........... 624.17\
Monthly UNsecured debt repayments....... 0\
Amount left after debt repayments....... 624.17\
\
Personal Balance Sheet Summary\
Total assets (things you own)........... 230,000\
Total HP & Secured debt................. -163,995\
Total Unsecured debt.................... -0\
Net Assets.............................. 66,005\0 -
That was quick, well done.
I'm afraid I'm no expert on assessing SOAs but there will be some friendly people along later who will be able to give you great advice.
One thing they may ask is how you got into the position of having to remortgage to consolidate your debts because there may be habits they you need to break to move forward.0 -
Electricity............................. 175:eek:
Is this a typo?0 -
There you go, Iris has already spotted something! :rotfl:0
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£80 for mobiles seems high. Satallite tv is costing you £630 a year which is almost another mortgage payment.0
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Clothing, tv and mobiles are all high, switch to sim only when your contracts run out. I did this and saved £23.75 a month.
Try cutting down on clothing for adults, kids grow and need stuff, eBay their clothes they have grown out of to go towards new stuff.
Can you cut down the satellite package?
Holiday seems low for 4 people, unless you go camping like us
Does your mortgage allow overpayments?
Save as much as you can, if you can't overpay, and pay a chunk off next time you remortgage, then if the rates have gone up it will less of a shock and your LTV will be better.
Please don't spend on cards again, it's tempting to think' it's only xxx much' but it will end in disaster, been there and done that.
The car will need replacing eventually, save for this as well.
I hope it works out for you xxISA £1675MiniMoohound savings £3685.86 :T Plus £3800 CTF
'MrMoneyMuststache' my new hero, Martin Lewis my long time hero
Poacher turned Gamekeeper
Roadkill rebel No 52 Aug £1.34p Sept 24p Oct 5p Nov 5p Sealed pot Challenge No 403 £176.66(2014) :staradmin NOV NST No 200 -
HI Thanks for the advice.
Iris yes £175. We are paying off the charges that arose when I forgot to read the meter and they had massively underestimated our reading. My fault so trying to clear. I am also tied to my tumble dryer - I know they are not efficient but I hate ironing!
Yeah mobile was a moment of madness as I wanted an Iphone 5 (and hubby) so that is a 24 month contract which runs out in 2015 so may go onto a pay only sim.
Sky is high and I Keep nagging hubby about it but he really wants it for Sky Sports! Footie fan! am thinking of changing to BT so not sure.
Is £400 reasonable / excessive for groceries?
Yeah we need to change our way of thinking but we have also spent a lot of money on extending our house which we did by using our cards and money as we have earned it. That is 90% finished now so this shouldn't happen again.
I have set myself a challenge to spend as little as possible and looking forward to the challenge!
Any other advice welcome!
:beer:0 -
If your want to avoid getting into debt again you need to understand why you got into debt in the first place.
Is your SOA the amount you want to spend, or is it what you really spend?
I would take a close look at my outgoings and make a spending diary to identify where the problem is. Try one of the apps goodbudget or YNAB ( your need a budget)
Some comments below:
Groceries etc. ......................... 400\ - This is ok, could be improved if you wanted to - look at theold style board for ideas
Clothing................................ 100\ - this is ok - but monitor carefully, so you dont spend more
Presents (birthday, christmas etc)...... 25\ very low for a family - is this really what you spend?
Haircuts................................ 10\
Entertainment........................... 100\ - could be improved if you wanted to
Holiday................................. 20\ - very low, not many families can make a holiday for 4 with this amount. It makes your entertainment budget stand out as large.
Take a look a t these and try to get better deals, no need for both a landline and mobiles. I would drop the cable tv.
Telephone (land line)................... 26.5\
Mobile phone............................ 80\
Satellite/Cable TV...................... 52.5\
Internet Services....................... 7.31\0 -
Clothing, tv and mobiles are all high, switch to sim only when your contracts run out. I did this and saved £23.75 a month.
Try cutting down on clothing for adults, kids grow and need stuff, eBay their clothes they have grown out of to go towards new stuff.
Can you cut down the satellite package?
Holiday seems low for 4 people, unless you go camping like us
Does your mortgage allow overpayments?
Save as much as you can, if you can't overpay, and pay a chunk off next time you remortgage, then if the rates have gone up it will less of a shock and your LTV will be better.
Please don't spend on cards again, it's tempting to think' it's only xxx much' but it will end in disaster, been there and done that.
The car will need replacing eventually, save for this as well.
I hope it works out for you xx
Thanks Moohound
Yeah it allows 10% overpayments of original loan amount. Thought would try and build a buffer of c£5-10k and then start paying £100 extra per month. Does that sound ok?
Yeah I am planning on closing the accounts and cutting the cards up as my total credit limits total c £70k which is scary.
Also should I set up a new account to pay a set amount over each month for food? Our current account pays all the bills and I want to ensure that there is more than enough in that account and leave it to grow.
Also hubby is self employed so £500 is the min I have said he has to pay in but some months he earns more than this but I am going to leave that as savings!
Thanks again !:T0
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