Terrible with money ....

Emptysack

Ive been visiting this site occasionally as I`m trying to be better with money.. I am married, have 3 children and am bad with money... I have 7 defaults registered against me and they are all for low amounts..It hasn`t even been beyond my means to pay them as I earn a pretty good wage, its just that I am so bad with money.. In total my defaults are less than 2 grand which is lesss than I earn most months...

I want to get my act together and start getting my finances in order, I`m 35 and want to start planning for the future rather than be broke all the time. I always seem to be working to pay the next bill and never have any spare cash..

Where do I start on the road to becoming debt free as I am still in the wannabe stage :-)

Bobarella

Empty sack
Others may disagree with me but no one has to be bad with money, & everyone makes mistakes. You can totally learn the skills to turn your life around and you have come to the right place.
Can you post a list of your incoming and outgoings. There is a link around somewhere that has a template to fill in.
O you have a feel for what is making you overspend?

McKneff

http://www.stoozing.com/calculator/soa.php

gfplux

No one needs to be bad with money. You just have to start thinking about it. Begin to care how much you have spare to spend each day, week or month.
Just don't except that you are bad with money. Frankly you can be good with money almost immediately.
You just have to WANT IT enough.
Good luck.

theoretica

To be good with money I advise a plan -you don't want or need to worry about money daily - just check your spending against the plan. This sort of thing: On payday I will pay X off which debts, I will take out Y in cash for all food for the month and random spending...

On_my_way

You have to do two things: 1) cut your spending dramatically 2) get to grips with exactly what you owe and to whom.

If you really study advice on this forum you can probably cut your spending in at least half from tomorrow! We only really buy things when they are on offer, work out unit costs etc as we put the money that we save towards other things like holidays etc.

So many people have a takeaway coffee a day and don't realise they spend £100 a month on it!

Good Luck!

enthusiasticsaver

If you have defaults against your name in spite of a good salary then I am assuming it is more that you are disorganised with money and paying bills rather than overspending. No one should accept they are bad with money, just take control of your finances.


Start by keeping a track of what you are spending and who you owe money to.


When you get paid divide your money up and put it into separate accounts/pots - one for essential bills, fixed direct debits and pay them off immediately.


Make a budget - allocating money to food, petrol, entertainment, holidays, clothing, subscriptions, gifts, house and car maintenance and annual bills like insurances, tv licence, car tax.


Save up an emergency fund - ideally 3-6 months worth of your salary over a period of time. The Save 12k in 2015 is a good thread to subscribe to (it does not have to be £12k)


Sort out those defaults or they will damage your credit rating.

Brightspark87

You know there is a problem, this is the best place to start.
With any of these defaults is there a reason did you not hear about them or just ignore?
Perhaps they are meant to be so you dont get more credit and start dealing with the problem! Good luck

Emptysack

Thanks everyone for the replies,.. I have used the calculator posted above and posted the results below.

Both my wife and I work and we have certain things we pay in the house,.. I pay the rent and electricity and she would pay for shopping and gas etc (Just incase people thought I had missed things out).

Another thing is I am self employed so have averaged my wage of 2000 on the basis of £100 Per day 20 days a month,.. some months it may be more and others it may be less but on average I would take home around £2000+ per month

I think the self employment may also be part of the prob I have with money,. sometimes I could get a large amount of cash... and well... It has been known to burn a hole in my pocket.. and rather than putting it in the bank I`m likely to say to to the wife lets go out for dinner/ shopping etc


Here is the list of incomings/ outgoings


Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 2000
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2000

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 360
Management charge (leasehold property).. 0
Council tax............................. 55
Electricity............................. 80
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 28
Mobile phone............................ 45
TV Licence.............................. 0
Satellite/Cable TV...................... 49
Internet Services....................... 50
Groceries etc. ......................... 0
Clothing................................ 0
Petrol/diesel........................... 200
Road tax................................ 20
Car Insurance........................... 55
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 12
Life assurance ......................... 22
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 986


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 6000
Other assets............................ 0
Total Assets............................ 6000

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Default accounts...............2400......0.........0
loan...........................5000......230.......9
Total unsecured debts..........7400......230.......-


Monthly Budget Summary
Total monthly income.................... 2,000
Expenses (including HP & secured debts). 986
Available for debt repayments........... 1,014
Monthly UNsecured debt repayments....... 230
Amount left after debt repayments....... 784

Personal Balance Sheet Summary
Total assets (things you own)........... 6,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -7,400
Net Assets.............................. -1,400

Created using the SOA calculator at.
Reproduced on Moneysavingexpert with permission, using other browser.

Emptysack

Brightspark87 wrote: »

You know there is a problem, this is the best place to start.
With any of these defaults is there a reason did you not hear about them or just ignore?
Perhaps they are meant to be so you dont get more credit and start dealing with the problem! Good luck

TBH I just Ignored them.. I knew in the back on my mind they needed paid but kept telling myself I`ll pay them next week or month... Until it was too late.. But as you say, maybe its a good idea that I`m not able to get credit until I sort things out

Two defaults where credit cards from capital one.. yes they gave me a second after I defaulted the first..

Total credit card defaults £700

1 Was from santander/ abbey national.. £160 which I just refused to pay as it was bank charges I did not agree with... (I moved my account to them and had direct debits coming out.. I lodged cash into my account on the day I expected them to come out and the next day they where all returned. When I questioned them about this they told me the money had to be lodged before a certain time to cover them... (This wasn`t the day after they came out, the cash was lodged the day before).. needless to say it was the last time I used that account.

Default £160


Next up was a payday loan I never repaid.. We`ll I did but every month they kept emailing me to rolll it over and I stupidly did.. Until I decided to stop paying it

Default £450


Also a catalogue with JD williams..

Default £450


Lastly there is also a default on my file from Hoist Portfolio... I do not even know what this is for tbh

Default £557


So I have a total of 6 defaults oweing £2317.. I also have a personal loan which is in my wifes name of £230 PM.. But this is paid each month and on time...

My question is,.. is there any point in even paying the defaults? I have read a satisfied default is a bad as an unsatisfied one..

hohum

I agree that no-one is 'bad with money'. It's just you made bad choices, and dealing with an irregular income is challenging for anyone. I used to think I was bad with money then I started using a budget (and looked at my last tax return!) and realised actually I have done quite well at surviving on very little.

So what was going on with the 'I'll just stop paying it' decisions? Don't have to answer, just think it's worth considering as you sort your situation out. I understand re the charges but there are ways to deal with them (most banks have discretion to refund once) and to be honest... you didn't get the money in on time. It's your job to check how long things take to clear. A painful one to chalk up to experience but I'd let it go.

I also think you are probably overestimating your income. If you are self employed, best idea is to look at your tax return for last year, look at turnover and divide that by 12. Does it really come out at 2000 per month? Plus I can't see anything in there for tax/ NI so is that your net income?

2 things that have absolutely turned it around for me:

- saving for regular bills. 'but I'm skint' yes but that means, when I'm flush I'm not really flush. The money gets spent on going out for dinner when it really needs to cover NI, car insurance, tax bill, professional subscriptions etc. Break down those annual bills. Look at when they are next coming out. Divide that by number of months. That's how much you need to find from now until bill is due. Also, birthdays and Christmas happen every year! If you don't trust yourself not to touch the money you're putting aside, can you give it to your wife to look after?

the second is joint budgeting. Absolutely revolutinary for me but it took four years before I could trust to do it due to previous negative couples budgeting experience. I also use YNAB (a paid for budgeting system) and find it invaluable.

Re the default accounts, when did they default? If they're recent you are probably best paying them off as they may have defaulted but still can be collected. And who wants to spend the next few years dodging creditors. A satisfied default is not as bad as an unsatisfied one. it's still bad, but it's better to have satisfied.