Advice please! - SOA included

National_Debtline

Hi Doorman

I would echo others' suggestions that you factor those annual expenses into your monthly budget. Also I would strongly encourage you to include a fund for sundries/emergencies etc. - you can't predict the unpredictable, but you can prepare for it!

It's fair to say that the majority of folk pay for things as and when they arise, but that doesn't make it the right thing to do. Hopefully you'll find a lot of motivation on these boards from people who are able to organise their finances very efficiently.

Good luck

Dennis
@natdebtline

theoretica

Doorman2014 wrote: »

I'm not tied into the bank account at all. I have this because I want all the insurances that it offers, phone, breakdown, travel insurance ...

Would it really cost you over £200 a year to replace just the cover you need? Have a read here for breakdown cover http://www.moneysavingexpert.com/car-insurance/breakdown-cover How often do you use the travel insurance (you don't have holidays in your budget either). Are you a phone looser? If mine went I would just replace with a cheapo, but see here http://www.moneysavingexpert.com/insurance/cheap-mobile-phone-insurance

I would pay the overdraft off to get a feeling and expectation of living in the black - if there is an emergency it is easy to spend it again.

Dobbibill

Hi Doorman,

SOA often take some tweaking and adjusting so don't worry that it's not precise on the first attempt. Re-do it again with annual spends detailed above being divided by 12 to give you a better idea. Also add in the figures that you missed such as things you pay, as and when they crop up. misc/emergency/Christmas etc.

If you fancy the snowballing method for the debts, here is a good link to calculate how long it would take you to be debt free.

http://www.whatsthecost.com/snowball.aspx

You will get there, it just takes a little bit of tweaking and a good look at EVERYTHING overall, keep working on that SOA

Keep at it

DB

getmore4less

A budget is a PLAN for how you allocate ALL your income until you have everything in the PLAN you don't have a complete budget.

The SOA format is a snapshot of how a months income is allocated across the full years worth of spending/saving/debt reduction.

If it helps do a SOA based on a full years numbers adding in all your add hoc items, then break down to a monthly SOA.

The reality is you need to have allocations for longer term things as if you do these on a as and when basis, that next car is going to need borrowing, back to square one.

asparagus1968

getmore4less wrote: »

A budget is a PLAN for how you allocate ALL your income until you have everything in the PLAN you don't have a complete budget.

The SOA format is a snapshot of how a months income is allocated across the full years worth of spending/saving/debt reduction.

If it helps do a SOA based on a full years numbers adding in all your add hoc items, then break down to a monthly SOA.

The reality is you need to have allocations for longer term things as if you do these on a as and when basis, that next car is going to need borrowing, back to square one.

that's what I was trying to say, you put it so much better

Pixie5740

I pay my contents and car insurance annually too but I 1/12th of the cost every month so that when the month comes to pay for it the money is already in my account. I do the same for birthdays, Christmas and other bills and expenses that aren't monthly.

Your Premium Bonds would probably do better in a savings account. I'm sure I've seen a Premium Bond calculator somewhere on MSE before.

JasX

Doorman2014 wrote: »

I completely understand although I'm worried that if I used my savings then it would take forever to save the money up again.

I'd think long and hard about what access to emergency funds you have and what the minimum you need is and use the rest to target interest accruing debts.

What you're basically saying is I'm maintaining a £3000 loan so that I can have £3000 in premium bonds sat in the bank. I worried if I used used the loaned cash to pay off the loan it'd take me ages to take out another £3000 loan again in future to end up in the same position?

asparagus1968

Lloyds CC......................4500......100.......0 --- interest free
Lloyds CC OH...................3100......100.......0 -- interest free
Very...........................300.......0........ .0 --- interest free
Tesco Loan.....................7200......155.......0
Tesco Loan OH..................8200......170.......0
TV Payment.....................450.......29........0 – Not interest free
Very...........................300.......0........ .0 --- interest free
Lloyds Overdraft… 300……0…….0 --- interest free part of the account package




Well, if this was me, I'd get my hands on the £3000, I'd pay off VERY x 2 accounts (£600)
overdraft (£300) and cancel the fee (saving £15 a month) am sure you could get the cover cheaper else where.
TV (£450)
This comes to £1350. Then I'd put £1000 in an emergency fund (?ISA account, earning tax free interest)
I'd put the last £650 into an easy access account to give a kick start to a insurances/Christmas etc fund.


Then I'd work out a proper SOA and start a budget plan.


What thoughts have you had as to what you are going to do?


good luck

getmore4less

Like that idea release the "savings" to be the buffer to kick start the proper budgets buffer for cash flow.

End of day net position is the key saving that earn less money than debt should only exist to cover cash flow(and emergencies).