Got here by luck, intending to stay by judgement.

getmore4less

Blunt time

I don't do SOAs as a rule, whilst I forensically log the incomings and outgoings it's never been so much about what it is being spent on, rather how much can we spend. When you've spent the last 5 years or so with everything maxed out and you have to choreograph paying the minimum payment, then using that card again to buy essentials, then swallowing the overlimit fee and doing that for each of the 12-15 cards you collect it's a different kind of vigilance you have. However, because I'm now in the treelined area of Forumville I shall post some highlights of my SOA just so as to fit in and not be run out of town by the pitchfork-wielding mob. But more of that later.

This has been your problem,

Too focused on cash flow you lost sight of the big picture and a budget.

What a SOA/Budget does is tell you is where the money goes.
The format is tried and tested and works.

DO one ASAP

You balance the cash IN to cash OUT over at least a year.

Normalizing all costs on a years cost is a very good way to see relative value

If it does not balance you go into debt and if you go over limits the fees start adding up(so they need to go back into the SOA) and make it worse.

There is no way a family can use all those entertainment options to get the value, loads of overlaps and even paying full price for stuff that is often available at discounts or free.

When you add up all the costs and all the fees those costs have incurred they are seriously expensive essentials, that's before you add the interest assuming you could have start reducing the debt if you cut the cost.

Why are you locked into mobile contract they should have gone at the last change.

.... the list goes on.

What sort of advice have you been getting on the Debt board if you arrive here with this mess?

As you have the data in your spreadsheets, do a SOA based on the 12 months before the consolidation.
Modify the debt section to put account of the interest/fees on each where the min payment goes, the final balance for the amount owing.

Then do a new one that balances based on no CC debt and the bigger mortgage to make sure you actually have enough income.

The old interest and fees should be spare cash on the SOA and the start of your mortgage overpayment/savings.
If not then there is more work to do.

You will still have to balance cash flow but if the in/out does not balance over a year you are doomed.

One that SOA balance you can look forward and start planning the next 5 years.

Review your priorities and goals it is up to you what you spend your money on jut make sure you have enough of it to cover those choices.

This is you chance don't waste it.

Edit: was thinking

When you've spent the last 5 years...

If you have the data a SOA from around 5 years ago might help with the picture and your review of your priorities.

solentsusie

Hi there getmoreforless

Your comment was interesting:

"What sort of advice have you been getting on the Debt board if you arrive here with this mess?"

The thing is MrBloater, to my memory of reading his posts, (and of course I very much could be wrong, and if so I apologise) never posted a SOA on the debt board. So it would be very unfair to say that the advice he received there did not help him. It is incredibly difficult to help someone without knowing the full picture of their problems.

Also, a lot of the posts, while incredibly amusing and great to read, concentrated on making additional money, selling things, additional summer work etc. and not it seemed actually tackling the debt and where the money was going...

This paragraph is also concerning me:

"Having spent a chirpy hour this afternoon paying off 50k of credit card debts I actually find myself pretty much Debt Free, and so am ambling over to the more cerebral side of MSE Town to join in with the MFW cause."

The mindset that he is debt free.... this kind of worries me. MrBloater has in fact added an additional 50K to a mortgage secured on the roof above his, and his families, head. That is hardly 'debt free'. Yes, it is probably going to help a lot in that he is not juggling over a dozen credit cards and loans each month to make minimum payment, but he really needs to look at how he is going to get that additional debt paid off and in the meantime ensure he doesn't rack up another debt.

It is something that happens time and time again; you rack up a high personal debt, add it to the mortgage to pay it off, then start spending again on the credit cards because "you can afford it" in that you feel you have loads more disposable income as you are no longer scrimping and saving to cover basic minimum payments.

I sincerely hope that he doesn't fall into this, it is so easy to do.....

I wish him the very best and look forward to seeing the SOA.

gallygirl

The other advice I'd give you Mr B is 'pay yourself first' - i.e. put savings away on payday, by standing order, rather than see what is left at the end of the month. If you've never had it you'll never miss it. Cut yourself a little slack (so I'm not so bothered about the TV etc) but get rid of the extra money in your budget before 'lifestyle inflation' creeps in and it disappears.

Igamogam

Time to play shed tetris Mr B and see if there is a flak jacket in there.................:o

I think your spending on 'home entertainment' has kicked this off and have to agree that it is eye wateringly HUGE. My children are no longer little but still I wouldnt have enough time in a day to make use of all that TV nor could I justify spending that much when I have a huge mortgage plus 50k to pay each month..........sorry a bit preachy.

I think I understand why you consolidated your debt onto the mortgage. If you cant get 0% deals CC APRs are crippling. I totally agree with others you really need to dump those cards and build up an emergency fund


I do get the whole thing about NOT posting an SOA though.

Good luck Mr B I think you just may need some

getmore4less

solentsusie wrote: »

Hi there getmoreforless

Your comment was interesting:

"What sort of advice have you been getting on the Debt board if you arrive here with this mess?"

The thing is MrBloater, to my memory of reading his posts, (and of course I very much could be wrong, and if so I apologise) never posted a SOA on the debt board. So it would be very unfair to say that the advice he received there did not help him. It is incredibly difficult to help someone without knowing the full picture of their problems.

Also, a lot of the posts, while incredibly amusing and great to read, concentrated on making additional money, selling things, additional summer work etc. and not it seemed actually tackling the debt and where the money was going...

I don't know when the DFW posts started or how the debts changed over that time.
Posters should have been hammering home the need for the SOA/Budget maybe they were and it fell on deaf ears.

What should be clear to MrB is the strategy they used for the last 5 years failed.

The family is at a crossroads......

Success or failure will depend how good the budget is and sticking to it.

Seanymph

Hi there,

I am not techy - I'll just put that out there. But your tv/movie stuff struck a cord with me.

Mr Sea and I had SkY with the kids, and other things that I rarely looked at, but SKY was around your figure.

Now Mr Sea got onboard with the saving thing, and as he has a love of all things televisual sought out a better option.

We now have a motorised satellite dish on the side of the house, a computer hard drive thing in the living room, and several thousand channels. All for the sum total of zero per month.

It cost about £500 from memory to set up - maybe a bit less - and I agree occasionally the Saudi subtitles draw your eye a bit as you try and work out how 'No' can look different every time it's subtitled.

But the Middle Eastern channels show nothing but films - we can find just about every sports event in the world (although 40 minutes of camel racing the other day made me want to smash the tv if I'm honest!)......... but it costs nothing, nada.

You save your favourite channels just like on SKY - and it zooms about between satellites by itself as you select the channels.

You may be able to find cheaper technology that serves your purpose if you work out what you want - for us it was films and sports. Just a thought.

Maplin is your friend

getmore4less

Igamogam wrote: »

I do get the whole thing about NOT posting an SOA though.

The real issue is MrB does not have a budget to share.

That £50k is still racking up interest so all those discretionary spends are coting more than the headline cost.

by not giving people the data you can't get a broad set of views on the options.

it is up to individuals where they spend their money and filter the views of others.

Goldiegirl

Hello Mr B, I saw your new thread when I was looking at the forum fairly late last night, and was too tired to respond, but I wanted add my comments.


As others have said, the debt is still there, but it's just moved to somewhere else!


I used to work in mortgage lending, and we'd often find that we'd do a re-mortgage for someone, including funds to consolidate debts. Then a year or so down the line they'd come back to us wanting a further advance for more consolidation.


Therefore I think people are giving you sound advice to get rid of your credit cards.


There's nothing wrong with credit cards as such, as long as you pay them off every month in full, and earn either cashback or points on what you spend.


But I'm not sure if you are at the point of being able to manage your spending so that you clear your credit card balance each month..... so I really think a further credit card cull should be considered.


However, the remortgage has given you the feeling of a new start, so mentally you have a clean slate, so the impact of this shouldn't be denied - just need to maintain it now!

I don't know your income, or your wife's income, so it's difficult to comment on whether your TV entertainment costs are large or small, especially as everybody has different standards on what is a lot of money.


But, if you are looking for areas to reduce spending, the entertainment does seem to be an area with a lot of scope.


For what it's worth, we cancelled Sky in January. We had a long hard look at our viewing habits, and realised that most of the things we watch are in Freeview. So we cancelled, and honestly, we've never missed it at all.


If you need a sport fix, ITV4 has a lot of sport, at the weekends.


It's all about getting the right balance that suits you. Everybody needs some pleasures in life, so if you adopt a regime that is too tough, it's doomed to failure. You just need to find your balance, by making some cuts, finding more money for savings/mortgage overpayments, but also allowing yourselves entertainment and treats.


I think you'd be wise to do a SOA, even if you don't post it on here. Plus, a spending diary is very helpful too

juststuff123

Perhaps this is unfair, but maybe MrB doesn't want to put up a proper SOA because deep down he already knows it'll be bad and full of unaffordable 'luxuries' (TV, Gaming machines, takeaways, alcohol - even if it is 1/2 price) and isn't ready to face it properly. He has yet to really have his light bulb moment.


A sense of humour is all very well but until you are really serious about the situation and willing to address your spending habits and change your lifestyle you will not succeed. And unfortunately consolidating your debts into the mortgage before you have reached this conclusion is a recipe for disaster.


I really do hope I'm wrong!

MrBloater

(Emerges in Flak Jacket - not a sensible flak jacket though, a designer Flak Jacket from a catalogue on extortionate credit terms)....

Am loving the advice and critiques, I wouldn't be putting it all up here if I was scared of the reaction. And I walked straight into it with the Entertainment budget (I think I'll keep quiet about the amount we spend on cars for now otherwise there's going to be some nervous breakdowns on here) which is stupidly high.

So, inspired by the wise words on here already I have made some little steps...
Step 1 - Talk Talk is now down to £29.20 and now comprises line rental, unlimited broadband and all calls unlimited whether they be International, or UK landline and mobile. Plus they are sending me out a new router free of charge. So that's £3.98 a month saved.
Step 2 - Xbox Live Subscription £5.99 a month has gone - didn't even include it in the figures yesterday.
Step 3 - Called Sky after looking online that my discounts were about to expire and the bill was going up to £85.50 and got it down to £62.75 (plus a free engineer visit to swop out the old box if it's unfixable). Saving £22.75 a month.
Step 4 - Suggested cancelling Netflix but was outvoted.

Seanymph - I would get on well with your husband - I used to have a manual motorized system (ie, I'd go out and move the dish slightly) to pick up 4 different satellites and watched a wide variety of international TV - it's certainly something to consider for the future again.

So in total today I have my outgoings down by £32.72 a month. A small win. But a win nonetheless.