My Lightbulb moment - advice?

sexki11en

I have just realised that we are £20,000 in debt. How did I not realise this sooner? I knew my OH had loans and student loans and a hefty credit card and an overdraft but not to the extent that it is.

I've been nagging for ages to get things sorted and today he emailed me at work to say he's realised how bad things are.

We earn good money between us but the monthly payments (minimum) are crippling us and we can't seem to make a dent in what's owed.

We live a good lifestyle and I fear that is about to come to an end.

We applied for a consolidation loan tonight to try and free up some payments to make bigger payments on some of the debts but were declined.

We both realise now that cut backs have to be made but with so many essential payments we don't know where to start.

Any advice will be gratefully received.

Teacher2301

HI there - you'll probably be told this a few times but you need to complete an SOA - look at the stickies in this forum - then loads of people will offer help and advice. BUT - you've done the right thing - well done.

sexki11en

I knew someone was gonna say that lol. Too much to get my head around tonight but I will do it soon and post.

Can I say proud to be dealing with someone elses debts? lol

It's a long story but one i'll have to share

Teacher2301

lol - not too long I hope!

stevenc75

Doing up your SOA is daunting, but worthwhile. It's always best to know where you stand.

sexki11en

You can hope lol. Saga doesn't cover it but you guys have heard it all before!

Here we go then, basic SOA for now. I will add apr's etc when I have more time and don't need to be in bed to get up early to work my !!! off!

My Salary: £2000 - £2500 9bonus dependant, most recently £2000)
OH Salary: £1500

Total incoming: £3500


Outgoings
Barclaycard visa £7.00
Council Tax £127.00
Water old house £12.17
Water new house £28.00
Visa Gold £148.00
Sofas (362) £26.95
Bank Loan1 £244.00
Bank Loan2 £108.61
House Ins £40.00
Mobiles - Me £35.00
Laptop ins £8.00
Telly £41.03
Gas/Elec £0.00
Student Loan 1 £64.00
Student Loan 2 £35.00
Telewest £108.00
Car ins £28.27
Car budget £35.00
TV Lic £11.00
Contacts £27.00
Mobiles - OH £35.00
Gym £110.00
Rent £875.00
*Edit £120 on OH petrol to work (he works 30 miles away, I walk to and from work unless it's raining then I get the bus back from work at £1.60 a journey)
Total Outgoings: £2274.03

Gas & electric not accounted for as that is part of the long story.

Car budget is for things like MOT, Tax and service (worked out actual amounts and divided by 12 months to put away)
Gym is being cancelled (if we can, I think we signed up for a year) and we are trying to negotiate with telewest as we signed up to 12 months.

Food - well, I have no idea. I've been following OS for a while and buying main bulk at Costco and meal planning etc. Not yet taking lunches to work but after tonights wake up call a lunch is already packed for tomorrow! Rough guess is this month we spent around £300 but because it was in bulk we have enough to see us to the end of next month. We have 3 cats but again their food & litter was taken from the food budget and we have enough to see them through too.

The telly we got because the cat pee'd in the old one and it went bang (we didn't have house ins at the time) and the sofas we got last year before I realised things were so bad (they're on interest free for the duration)

We have also paid out this month for a hotel stay this weekend for a get together, an outfit for me for OH's brothers wedding (bought through quidco - cost £60 for dress & shoes) as I have gained over a dress size since I last bouhgt some clothes and couldn't physically squeeze respectably into anything I owned, a friends wedding reception and some cheques throught the money shop. (I know, I know but it was a short term solution before I realised how bad things were)

So there we are, warts and all. Be kind please, I know we're a lot better off than most on here but we are still finding things hard.

katierose

I would recommend a spending diary for you and oh ,writing down everything you buy including the odd cup of coffee or bar of chocolate it is amazing to see it all written down.

sexki11en

We currently have £40 for the month between us and with an upcomming commitment and 2 weeks before payday we are going to have to borrow again to see us through.

Is it best to start this spending diary on payday when we can start on an even keel?

Teacher2301

Hi again - thanks for doing the SOA.

You still have about £1450 per month spare - why not put £600 a month towards paying off the debt - 3 years and its gone give or take a few months. That still leaves you around £400 each per month for food etc.

But a few other things if I may...

Sell the dress on ebay for starters!! Unless you have any other events in the next year.
Can you not put the laptop on your contents insurance as an named article and save £8?
Does your OH have to pay out for their student loan (I am assuming that student loan 2 is theirs?) - do they meet the threashold level to pay it back?
PAYG mobile - you can pick up loads of free SIM cards or go to CWP! £35 is too much if you want to save money on what is doubling up in your communications costs.
Not sure what Telewest is - is it like Sky - if so ditch it and go for freeview instead.
You know what I'm going to say about the GYM!!! Run - its free.
If your rent is that big - why don't you get a mortgage and stop paying someone else mortgage for them. I pay a bit more for my mortgage and its for me and no-one else - you might have to downsize but you have to start somewhere and get onto the housing ladder. If you're renting - surely your landlord should be paying for the water and house insurance anyway - it's the law. You then pay the landlord maintainance - for such things as a contribution to house insurance, rates and upkeep/ ground rent. I would check your tenancy agreement and confirm you not paying for something twice. Or unless you meant mortgage - lol.

tallyhoh

NO- start your spending diary now- this minute.

Starting it from payday will be a bit like starting a diet next week, you will be inclined to stuff/ spend before the day.

All the best.

sexki11en

Teacher2301 wrote: »

Hi again - thanks for doing the SOA.

You still have about £1450 per month spare - why not put £600 a month towards paying off the debt - 3 years and its gone give or take a few months. That still leaves you around £400 each per month for food etc.

But a few other things if I may...

Sell the dress on ebay for starters!! Unless you have any other events in the next year.

I could do that, not a problem (not sure what i'd get tho, it only cost £23)
Can you not put the laptop on your contents insurance as an named article and save £8?

Will have to chck that one out, it's a good house ins
Does your OH have to pay out for their student loan (I am assuming that student loan 2 is theirs?) - do they meet the threshold level to pay it back?

Both student loans are OH's and yes, he's on the threshold to pay it back. If we postpone it now when we can (just afford it) it will never be paid
PAYG mobile - you can pick up loads of free SIM cards or go to CWP! £35 is too much if you want to save money on what is doubling up in your communications costs.

I live 200 miles from my mum and call her every day (for free) on it. Yeah, I could not call her or call her from home but I would never call her if that was the case as when I get home, I cook, clean and then it's time for bed! (normally try and be in bed for 10 for work)
Not sure what Telewest is - is it like Sky - if so ditch it and go for freeview instead.

The telewest is for landline, broadband and telly package - we're working on bringing it down if we can - we signed up for 12 months when we moved
You know what I'm going to say about the GYM!!! Run - its free.

Already said - we're going to cancel it - I haven't been since before our holiday anyway
If your rent is that big - why don't you get a mortgage and stop paying someone else mortgage for them. I pay a bit more for my mortgage and its for me and no-one else - you might have to downsize but you have to start somewhere and get onto the housing ladder.

It's doubtful we'll get a mortgage for our salaries. My salary is mostly commission based and although it's fairly consistant, it won't be taken into account. Our fa thinks we might get offered around £150k for a mortgage (if he bends the rules - he's my bosses fa and will stretch my bonus onto my salary) but in Bristol there's very little available for £150k

If you're renting - surely your landlord should be paying for the water and house insurance anyway - it's the law.

Really? I think someone would have told the letting agency. The tennancy agreement says nothing and having rented for 10 years i've never come across this * Edited to say this is contents insurance and not buildings insurance

You then pay the landlord maintainance - for such things as a contribution to house insurance, rates and upkeep/ ground rent. I would check your tenancy agreement and confirm you not paying for something twice. Or unless you meant mortgage - lol.

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