Mini meltdown and light bulb moment

Fortune_Smiles

Just a very quick post as we're in the middle of moving but I didn't want to read and run.

What's done is done. Relax and make the most of the holiday - you don't want it spoiled with regret

However, you can start making a difference from now and it looks as though you have already started

Fortune x

AleMrsT

Thanks fortune, I feel a lot better about things this morning, although I've had to come home from work this morning as I've been unwell, so I'm taking a day to plan (and rest).

In the grand scheme of things, I knew about all the debts individually, and most of them were planned and budgeted for, such as the car and the initial balance transfer that allowed us to upgrade items in the house that needed replacing (washing machine and PC). It is knowing that the original card is now back up to where it was that is getting to me.

So my plan of action is to set a household budget, rather than just a personal budget. We have a bills account that we both pay £650 a month into (its all in OHs name though), but this covers all of the household bills including grocery shopping and petrol.

I need to check whether the £183 per month car payment also comes out of this account, if not, then we will transfer the payment to come from the bills account.

Then I will see if we can do anything about the phone bill. Both of our mobiles are on the same contract, it should be £60 per month, a quick look at the bills account the other day showed that this is sometimes over £100 per month. This is my fault. My internet usage. Because I don't get a bill, I can't see what I'm using, and I dont know when I have reached the limit on the allowed data usage.

I'm going to get OH to alter the settings so that the data can't be used when it is near the usage limit.

Next on the list is tackling the small monthly payments that come out of the account that all add up.
£10 per month for window cleaning, I forgot we set this up, and I dont know when the windows were last cleaned!
£8.99 Netflix - this is staying, we use it every day, its well worth the money
£9.99 for OH's Dropbox account. I also use dropbox but only the free one, but the storage capacity on mine is full. We use this for scanning and saving our important documents so we can both access them, (marriage cert, driving licenses, passport, car and house insurance docs etc). He also uses this for work, so that he can access everything he needs if he ever has to do something from home. I don't know whether there is an alternative to this.
Then there is spotify premium that OH also has, I again have the free version. I'm not sure how much the paid version is, I think around £10 per month, I will see if he can downgrade to the free version.
£25 for his paid account fee. He pays this fee per month for his premium bank account, which he had to do in order stay with his bank when he entered his IVA 10 years ago. I am going to suggest that he downgrades his account or at least try to negotiate on the cost. It does mean that he gets a slightly higher overdraft limit and doesnt receive over draft charges so often.
£12.99 per month for his experian account. I will also persuade him to cancel this and sign up to noddle instead. He doesnt need to pay the fees now his credit is repaired.

That is £77 per month for all of those.
Then we have our phone line and internet through BT. I think this is £30 per month, we don't have a TV license as we don't watch live tv, I think £30 is the best we could get it for since BE internet no longer exists. This is one to look at at a later date, as I think we are in a contract with Sky.

Next is grocery shopping. This is the one that will make the biggest impact and I will be able to have more control over. We do one big shop at the beginning of the month, usually at morrisons, then get top up shops from tesco as this is near to our house (which is part of the issue! We nip in on the way home from work,£20 spent etc).

I always say it, but I a going to try and shop online. Last week we spent £163 in morrisons. This is a monthly shop, so works out at £40 a week, which I don't think is terrible, although it is when you add on all of the quick trips to tesco at £20 a time.

I am going to start meal planning again, and be more strict with not buying snacks, not shopping when we're hungry and actually ONLY getting milk when we need milk!

If I can look at some of those things, its a start.

Now to find a day where we're both at home so we can sit and go through it all properly. He's off tomorrow but I'm supposed to be working, however if I'm still not feeling great I may not be at work, but in an ideal world I need to go in as my colleague is still on holiday until next week and it is another sick day unpaid if I dont go in. Saturday we are both off, but its a hospital day and its not practical to sit going through finances from a hospital bed! Sunday he's back at work. :rotfl:

October_Starter

Hi MrsT :wave:

I hope you managed to sit down with OH and get a plan together. I know that my OH and I have done the same, hence being back to MSE and fully committed. I have even got OH signed up.

You can do it!

October xx

enthusiasticsaver

You are right in that you should not have booked the holiday but I totally understand why you did even though it has put you under more pressure. You are by no means unique in that holidays often are the bugbear with people when they are debt busting. Partly it is the psychological benefit of having something to look forward to in amongst the drear of paying off accumulated debt. However it is your fifth anniversary, you know you have to save for it so nothing to do but look forward.

Cancelling unnecessary direct debits is a good start. I never understand why people pay for Experian. Noddle is good enough and is free. Putting up with adverts on Spotify to save £120 a year is good. I always find with my OH giving him the yearly benefit amount of some saving which seems insignificant then sinks home how much all the little bits and pieces add up to.

Setting up a household budget is essential. You both need to be on board with budgeting or you will constantly be fighting against each other. Knowing the true amount you have between you is critical so I hope you manage to have the talk and come up with a plan to keep within budget, put aside for car and other stuff and save for your holiday.

I presume the DMP is just in your name? Regardless of whether the interest rate is 0% or not 5 credit cards is too much to handle in your situation. I assume these are in your OHs name?

AleMrsT

So I finally managed to sit down with OH and go through everything! It took us a whole evening but we wrote down and accounted for every single penny of spending and worked out what we owe to who etc.

I have done a budget based on our income and we've made several changes already.

When we looked at it all, we can definitely afford the holiday. Actually we could afford to go on holiday every year if we wanted to. The issue which I was aware of but didnt know the true extent of until we sat down with all of the figures is the amount we spend on 'stuff'. It's ridiculous. I thought we did ok grocery shopping as we did one shop per month. Not the case. Looking at all 3 accounts together and adding up the big shop plus our ad hoc spends, we spent £434 on groceries. In one month! On top of this we spent £138 on eating out, £127 on leisure and £134 on fuel for the car. Ridiculous!

Our total debt is actually £22660, not as bad as I'd calculated as to be fair OH has been paying down his credit cards more than i thought.

We spend £547 on debt repayments. This isn't going to change any time soon if we want to get them cleared.

OH has cancelled his experian account. £120 per year saved.
We were spending £40 per month on lottery tickets between us. That is stopping. We now have a limit of £10 each per month for lottery.

We've decided to switch to online grocery shopping and do one shop per week. Our grocery shopping is being delivered at 10pm tonight (cheapest delivery slot!) and we spent £57 for the week.

I have set us a grocery budget of £300 per month which I still think is extremely generous. I've also allocated £150 for fuel and £100 for eating out, all quite generous because if I slash those budgets entirely we will end up having a blow out and undoing all of the work we've put in.

With these changes it means we have £200 per month towards the holiday, £40 per month to go into savings for next year's car insurance and any surplus from any of the budgets will go towards an emergency fund.

Once the holiday is cleared, the £200 per month will switch to another debt.

We have also both sent off PPI claims. I'm waiting to hear back from mine, OH has already received confirmation that he is due compensation, he is waiting on a cheque for £330! He couldn't believe it. He didn't think he'd be able to claim but he's glad I nagged him to do it. That money will go towards the holiday and he's waiting for a decision on 2 more claims that he submitted.

So things are looking up. It is so much easier having him on board. To keep up momentum I'm going to make sure we sit down together every month to review the finances, and each week I'll update what we have spent so far from each 'pot' and see what we have left.

We're off to see my sister today who moved into their new house last week, they're finally home owners after 7 house moves they may now actually settle in one place! Then we have my parents dog overnight as they're off to a wedding so it's a no spend day for us!

Seeing my sisters new house and how cheap their mortgage payment is has got me thinking long term. I would really like to buy a house in the future, so that is the end goal. Pay off debt, save a deposit. But for now, paying off the holiday (that we most definitely can afford) is a good starting place!

AleMrsT

I forgot to mention that I've also ordered my new glasses and prescription sunglasses in preparation for the holiday. I've got money set aside to pay for them and my mum works at the opticians, so not only do I get 20% off the glasses and 50% off the sunglasses, I can pay for them over 2 months which is really helpful.

Dorastar

You are doing brilliantly already, sorting it out and talking with DH is so important. The holiday is booked now so I would go ahead with it otherwise when it comes to that time you will feel 20x worse (got that t- shirt)

Every little reduction in bills can be put against holiday then debts and seeing the totals go down will be lovely. We are in similar debt and having the same conversations with DH who is a real ostrich

Keep going - you got this

AleMrsT

Dorastar wrote: »

You are doing brilliantly already, sorting it out and talking with DH is so important. The holiday is booked now so I would go ahead with it otherwise when it comes to that time you will feel 20x worse (got that t- shirt)

Every little reduction in bills can be put against holiday then debts and seeing the totals go down will be lovely. We are in similar debt and having the same conversations with DH who is a real ostrich

Keep going - you got this

Thanks Dorastar. I really do feel much better now that he is willing to talk about it, it's so frustrating trying to come up with a plan when you can only see half the picture. Hopefully you get somewhere with your ostrich OH too, I can sympathise! Fingers crossed he will carry on being interested and engaged in the process, otherwise I can see us ending up back at square one. It's managing the spending that will be difficult as we each have our own accounts then he has the bills account which he can access too so it's going to be a delicate balance of enquiring about spends but not being militant or naggy!

Dorastar

We have a joint account but I have a squirrel account in credit union for emergencies. DH uses cash now because he still thinks that shopping and getting cashback means he has won������

AleMrsT

So far, so good. We have a budget drawn up for September already and are working hard to reduce our spending.

OH has received confirmation that he is due £330 back for PPI on one of his credit cards, we're just waiting for the cheque and thats going to be paid straight off the holiday balance. With paying for my new glasses and having to add more to the bills account this month I haven't been able to pay any more off the holiday so the £330 is very welcome. He's just waiting to hear back from a few more claims that he submitted so fingers crossed.

I've done a meal plan for the rest of the month, and will unfortunately have to borrow some money from OH's overdraft to finish the month with as I don't have enough left in my account for the two remaining payments that are due to come out, but any surplus I have once the two payments have come out I'll put back into the holiday.

OH is at work today and it really feels like a Sunday so I'm pleased to have an extra day off tomorrow too.

Going to have a sort through the wardrobe and the rest of the house and get listing things on ebay, I had an email about free listings and £1 selling fees this weekend so I might as well make the most of it!