Here I am again!

Newlywed_Saving_Ninja

I am so annoyed with us, here we are again!!!

LBM number 2 today. We got ourselves more or less sorted a few years ago, cleared A LOT of unsecured debt, and got a loan for £8000 to consolidate the rest with the Co-Op.

Today my car went in for some repairs (nothing too drastic), only to receive a call this afternoon to say that they have found something else wrong and it is now going to be a £1000ish bill to fix :mad::eek:

We feel sick at the thought, but have no choice but to repair it, as we don't have the means to buy a new car. So that repair bill is going on the credit card

We bought our first home together in April this year, after all of the struggles to clear unsecured debt a few years ago while renting a complete hovel, we also managed to save a deposit for our home, which means everything to us. However, we poured everything in to it for the deposit, and so now have no savings AGAIN. So here we are again, a crisis hits (my car repair bill), and it is going to have to go on a credit card

It has been a much needed wake-up call for us though, that we are on the slippery slope again, and it is time to stop.

We have done some calculations and realised that we have around £1000-£1100 spare money each month, so could really blitz this unsecured debt quite quickly if we really knuckle down. This realisation has made us get our battlegear on and get ready to live frugally again for a year or so to get it cleared once and for all.

We really do live sensibly (we don't have sky, no expensive mobile phone contracts, mine is £12 a month, Husband's is £24 a month), so unlike the first time, there are not many cuts to be made this time in terms of monthly outgoings sadly. But we are stopping our Sunday papers being delivered (we have this evening admitted we barely read them anyway, so a total waste of money), Husband is stopping his creditexpert at £15 a month, I am stopping my ancestry.co.uk at £13 a month. Altogether that is £40 a month saved, so better than nothing.

I don't really expect any comments, I think I just needed a good vent at how mad I am with us!!! We are such idiots!!!

ReadingTim

Newlywed_Saving_Ninja wrote: »

This realisation has made us get our battlegear on and get ready to live frugally again for a year or so to get it cleared once and for all.

Living frugally "for a year or so" won't get rid of the debt "once and for all"; it'll simply get rid of the current debt until you stop living frugally, at which point you risk slipping back into the red until LBM number 3 happens and the whole story repeats itself....

Sorry to sound harsh, but to stay out of debt you need to learn to live frugally, or at least within you means (ie spend less than you earn) each year, every year, for the rest of your days.

Playing_with_Fire_2

I'm more hopeful, living frugally for a year will clear the debt emergency, build up an emergency fund and start new frugal habits.

If the OP genuinely puts on battlegear and is a ninja then staying debt free after becoming debt free will be straightforward, although requiring constant vigilance and the ability to say no sometimes. Buying a house is the last excuse for not having savings or an emergency fund.

I think NSN can do it!

rogue999

Hi - if you have £1000 spare every month them you could put the repairs on a cc and pay it off in full at the end of the month, that will at least give you a months breathing room until the bill is due.


BUT - are you sure you actually do have £1000 spare per month? I would do an SOA to make sure.

Newlywed_Saving_Ninja

Thanks everyone for the comments, I appreciate the replies.

I don't mind blunt/harsh, it is the best way with things like this (I can be a bit blunt/harsh myself sometimes!), so thanks ReadingTim, everything you say is right, and we had lived frugally and within our means for years while clearing the debt years ago, and while saving our deposit for our house. So the fact we have got in to this position again, well, we are just really annoyed and disappointed with ourselves. We know we can do it, and that just makes it more of a pee-us-off moment that we are here again.

Thanks Playing with fire, I appreciate your belief in us! You are right, buying a house is no excuse for not having savings, an emergency fund etc. The house we have bought was of the type we never thought we would afford given that we are first time buyers with just a 5% deposit, so when a 3 bed detached house with separate garage, front and back garden in a cul-de-sac in a rural location came on the market for just £125,000, we went for it and threw all our savings at it, as we knew nothing else would match it for our tiny budget. But we agreed we would save hard to get savings built back up, and we stupidly haven't done that. We are annoyed with ourselves for being idiots, but it is done now, and we just have to deal with the consequences.

We are determined to set ourselves free from unsecured debt once and for all, the liberation we will feel once it is done will be amazing. So we are staying focused on that.

Once the loans and credit cards are sorted, then we will be throwing large overpayments at our mortgage, to pay that off early. We are late to the house-buying game (we met each other later than most), buying a home together as first time buyers when I am 36 and my husband is 43, well, we have some catching up to do!!

Get out of my head Rogue999, I logged on here just now to complete a SOA!!! Regarding putting the £1000 on a credit card, well, things have changed regarding my car, it is back together and driveable, but to put it bluntly it is terminal so not worth spending that amount on it (also the quote was £1900, so almost double), so this mission is really on now!!!

I am off to try and find the SOA template now!

Newlywed_Saving_Ninja

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household.........
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 1465
Partners monthly income after tax....... 1985
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 3450

Monthly Expense Details
Mortgage................................ 787.9
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 117
Electricity............................. 52
Gas..................................... 0
Oil..................................... 50
Water rates............................. 13
Telephone (land line)................... 17.99
Mobile phone............................ 36
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 29.9
Groceries etc. ......................... 280
Clothing................................ 0
Petrol/diesel........................... 320
Road tax................................ 11
Car Insurance........................... 40
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 17
Pet insurance/vet bills................. 20
Buildings insurance..................... 35
Contents insurance...................... 0
Life assurance ......................... 17
Other insurance......................... 15
Presents (birthday, christmas etc)...... 60
Haircuts................................ 0
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1980.79


Assets
Cash.................................... 0
House value (Gross)..................... 125000
Shares and bonds........................ 0
Car(s).................................. 9000
Other assets............................ 5000
Total Assets............................ 139000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 117088...(787.9)....4.64
Total secured & HP debts...... 117088....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
First Direct Loan..............6386.52...153.7.....11.9
Co-Op Loan.....................5559.02...172.1.....10.74
Halifax Credit Card............200.......100.......0
Barclaycard....................2524......85........0
Nationwide Credit Car..........439.7.....25........9.9
Total unsecured debts..........15109.24..535.8.....-


Monthly Budget Summary
Total monthly income.................... 3,450
Expenses (including HP & secured debts). 1,980.79
Available for debt repayments........... 1,469.21
Monthly UNsecured debt repayments....... 535.8
Amount left after debt repayments....... 933.41

Personal Balance Sheet Summary
Total assets (things you own)........... 139,000
Total HP & Secured debt................. -117,088
Total Unsecured debt.................... -15,109.24
Net Assets.............................. 6,802.76

Created using the SOA calculator at https://www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using other browser.

Newlywed_Saving_Ninja

SOA above, feel free to comment if anything doesn't seem right, or with any suggestions!

rogue999

Could you get by without your car? I gave mine up about 2 years ago (dh still has one as he works further away) and I now go everywhere on the bus, which was a big change for me as i've always had a car - probably part of the reason i am in debt! It was a struggle at first but i don't mind at all now - we do live in a big city though, i know transport isn't so good everywhere.

Newlywed_Saving_Ninja

It's a great suggestion Rogue, but unfortunately we live in a village in a rural location with no public transport. If my car fails us, my husband will have to drop me at a train station each morning, the mornings will be fine, but I potentially face not getting home until 7.30pm some nights if I don't get to the station at the right time to get my train home, eek!!!

I am taking the positive from this, it has woken us up to get this mess sorted once and for all and never end up back here again.

nicp60

Hi!!
Just a couple of questions if I may...
- You have almost a grand a month surplus but you've obviously been spending this - what on?
- In this time you've also added to your debt - again, what has this gone on?
Just wondering if you know off the top of your head or whether it's fritter that needs addressing by doing a post mortem of your bank statements...

I'm sure you can do this! Best of luck!!!

Newlywed_Saving_Ninja

Hi nicp60, thanks for taking the time to read my post.

Generally, we have no idea where the £5-£6000 has gone since we moved in our house in April! It's generally just been frittered away from what we can see, I'm so annoyed about it, we had got in to being so careful, it's like we bought our house and then just turned in to spendy lunatics!

We have bought quite a few tickets to various events over the last few months which explains some of it at least.

Also, just to give a bit of background, since last September I have lost 6 stone 12lbs, so when I tried on my "winter clothes" about 4 weeks ago, well I am sure you can imagine how it all looked. I literally had nothing that fits, NOTHING. So I had to go and kit myself out for the cold weather months, I managed to do it for about £250, mainly thanks to the Sainsbury's 20% off promotion on their clothing and some charity shops managed to find a winter coat by lands end in excellent condition for £8. So that accounts for some of last month's spendiness. My husband also had to buy some jumpers as he has lost 3 stone this year, but he only spent £42.

The first direct loan that has increased our borrowing was for my husband's car. His packed up in May. While we could have bought another cheap run around, they always end up costing us loads in repairs, so we got the loan to buy a newer, low mileage (6800 miles) car.

My nationwide card is just ridiculous stuff, shoes, tickets for a show next February that I just "had" to have (yeah right). Rubbish like that really.

My co-op loan was consolidation of the last bit of debt from our first LBM.

I will update with what the debt on my husband's Barclaycard is, I suspect some of it is to do with previously mentioned car that packed up in May.

The fritter is stopping now though. The cards are permanently left at home to put a stop to it.