What to do????

Pixie5740

My income is very similar to your incomes. I was never very good at budgeting and with that sort of money coming into my account I almost felt invincible and the only reason I wasn't in debt was because I had so much coming in that even I was hard pushed to spend the lot.

After a year of frivolous spending I started trying to make budgets using spreadsheets and they sort of worked. It wasn't until I started using YNAB that I really started budgeting properly and thinking about what I was spending my money on. You take care of the pennies and the pounds take care of themselves has never been more true (for me anyway).

Do you have things you could sell like the 2 seater sports car until you've cleared your debt? The other assets of £15k? Any designer clothing and accessories you know longer wear? Gadgets? I made a small fortune having a good clear out.

I also use websites like Top Cashback and Quidco when I'm changing utility supplier, buying insurance and booking flights, trains and hotels.

If your husband won't consider changing broadband supplier/package could he at least negotiate a better price? If he can find a better deal elsewhere then BT might match it.

enthusiasticsaver

That is very positive as although yes £40k sounds a lot you have a high income and reasonably high disposable income so I am guessing that you are both a little disorganised with finances and do not budget.

Move the credit cards to 0% deals. If you have no defaults then you should have no problem with getting good deals. Barclaycard are doing a long 0% deal for 36 months and 2.99% fees on balance transfers. That means that it will cost you £1196 in fees to transfer the whole £40k over (assuming you can move that much) but all £1900 will then go to reducing your debt meaning it will be cleared in 21 months (less than 2 years). Do not add it to your mortgage or take out consolidation loans.

Next go through your soa again and add in things like presents, entertainment as I am guessing that is where you are falling down. What is the other £15000 asset and where is the emergency fund going to? I would resolve with your OH to reduce the costs of holidays and maybe the cleaner until this is sorted. Use the comparison sites to get insurance asap but I think your biggest problem is not budgeting and lurching from bill to bill without allowing for where the money is coming from.

Finally most important is to stop using credit cards until you have better financial discipline and actually put £100 per month or more if possible into an interest paying current account to cover your mortgage if you have further difficulties. I would guess that your OH is maybe in a well paid but insecure employment which means you need to be doubly disciplined. I also cannot see why you do not have joint finances as that would mean you are both on board with any changes you may need to make in the next few years.

This is all perfectly doable though as long as you are both committed to sorting it out.

bugslet

p1nk18 wrote: »

I applied for a virgin 0% card last week and I was declined because I stupidly have a rejected payment for my amex card from m,y current account.

enthusiasticsaver, I think p1nk has tried that one already.:(

enthusiasticsaver

OK I have just seen you have a default so moving may not be so easy but if you go onto Noddle it gives you an idea of what credit cards will accept you and what defaults are showing. At 18% you are paying £7200 per year interest on your credit cards so that is more than the cost of your annual holiday so that is unsustainable. You should be able to get a better deal than 18%

p1nk18

Hi All,

The 15k is my engagement ring and wedding ring. We have never been organised with money at all! We're useless and I guess because we were always earning money it wasn't an issue for us. Having a baby at the same time as losing our jobs has resulted in us having this debt, but also we need to start being more careful rather than going out and spending willy nilly!

p1nk18

One of my credit cards, the balance is 3742 and that is interest free until 30 November and then it goes up to 19.9%

bugslet

p1nk18 wrote: »

Hi All,

The 15k is my engagement ring and wedding ring. !

Noo, you can't seell them unless you get to the point of no food on the table!

What about the second car? I used to have a silly sports car I loved, but tbh, rarely used. Thought I'd mis it more than I did.;)

enthusiasticsaver

I would guess therefore that you do not want to sell your engagement and wedding ring. Hopefully they are insured!

My priority would be to move the credit cards on to lower interest deals. As I said if you go on to Noddle they should be able to help you find a credit card which may accept you. If not it is even more of a priority you no longer use the credit cards. You can use YNAB software but it does cost and because I am cheap I use spreadsheets instead to monitor spending. That involves recording everything, from your daily newspaper to the drinks down the pub, haircuts, days out etc etc. Then you can see where your money is going. Draw out cash at the beginning of each week for food, daily spend etc and at the beginning of the month leave enough in the bank account for direct debits and move the rest into a high interest current account for emergencies, large annual expenses like insurance etc.

It sounds like in the past you have relied on your bonuses for things like holidays etc and have not allowed for the fact that the bonuses are no longer coming in and that you also now have childcare for a baby and all the additional costs that go with that. It will involve an adjustment to your lifestyle but better realising it now with £40k debt rather than in a year or so time when the debt may be nearer £60-£80k especially with more than £7k a year in interest. Incidentally if you have mortgage arrears I would prioritise that over your credit cards.

enthusiasticsaver

Sell the sports car and you will save on the storage costs as well. It is impractical with a baby anyway.

MallyGirl

p1nk18 wrote: »

With regards to the internet my husband works from home and has BT business internet. I've spoken to him about it in the past and he will not change it.

I work from home with no issues on BT Infinity 2 which is £26pcm.
For home insurance, with the value of your house (and I expect the contents) go for an 'unlimited' policy. Join quidco or topcashback before getting quotes - I have made over £500 from these sort of portals in the last couple of years.
Good luck