Smack in the face

ellesbellesxxx

Can I just check - do you really only spend 50 a month on food???

The only areas I can really identify to cut back on are: mobile (either try and go down a tariff or switch to sim only deal, eg giffgaff)
landline/internet - you can get great deals by haggling too!

You have been given excellent advice though so good luck!

sourcrates

FireWyrm wrote: »

So, is your SOA based on potential fantasy income, or actual guaranteed income? If the former, you will need to adjust your thinking a little and deal with reality. Just because you might earn an additional £300 a month does not mean you will and banking on it (literally and figuratively) does you no favours at all. The key to getting out of messes like this is telling yourself the absolute, unvarnished, brutal truth. If you spent it, you have to account for it. If your income is less than your outgoings, then you need to know that and plan accordingly. If and when you get a nice bonus of £300 a month, THEN you can throw it at the debts without affecting your current standard of living.

So, given your wake up call, what else have you done? Do you know exactly how much you spend a month and on what? I dont mean the optimistic numbers you used to fill in that SOA, I mean the actual truth? Have you kept a spending diary? Have you determined exactly how much you have spent on travel, food etc over the last few months? If not, I would suggest your first port of call is your bank, request you statements going back at least a few months and a box of highlighters. Go through it with a fine tooth comb and do the maths to get a realistic picture.

According to your SOA, you should have north of £200 a month 'spare' but clearly this is not the case. Therefore, your accounting is incorrect and therefore, useless. You need the truth, not whatever fantasy numbers 'seem' right.

You should also look very carefully at proper accounting software (or the nearest normal people need to get to it). You Need A Budget dot com will get you what you need. The price seems high, until you get yourself in a mess like this, then it's worth it's weight in gold. I've been using it for several years now and I cannot imagine a day when I will go back to not using it or something like it. Absolutely essential in our modern world and especially if you dont use cash. It is too easy to lose (lie to yourself) about transactions and then end up in the mess you are in. This will put a stop to it. At least get yourself a spreadsheet from www.vertex42.com and do some proper accounting. You would not expect a business to run without accounts and HMRC for sure wouldnt tolerate such behaviour, so why do you imagine you can run a mult-thousand pound annual household budget with finger in the air estimates and guesses?

Oh you send shivers down my spine Firewyrm !!!


but your advice, as always, is spot on, excellent point, well made !!!!

sarlouwoo

Hi David, presumably as your season ticket loan is taken before tax, then this has already been accounted for and therefore shouldn't need to be on your SOA? This would mean that you have an additional £441 available each month according to your calculations so, as indicated above, there must be things missing from your SOA...

david756

FireWyrm wrote: »

So, is your SOA based on potential fantasy income, or actual guaranteed income? If the former, you will need to adjust your thinking a little and deal with reality. Just because you might earn an additional £300 a month does not mean you will and banking on it (literally and figuratively) does you no favours at all. The key to getting out of messes like this is telling yourself the absolute, unvarnished, brutal truth. If you spent it, you have to account for it. If your income is less than your outgoings, then you need to know that and plan accordingly. If and when you get a nice bonus of £300 a month, THEN you can throw it at the debts without affecting your current standard of living.

So, given your wake up call, what else have you done? Do you know exactly how much you spend a month and on what? I dont mean the optimistic numbers you used to fill in that SOA, I mean the actual truth? Have you kept a spending diary? Have you determined exactly how much you have spent on travel, food etc over the last few months? If not, I would suggest your first port of call is your bank, request you statements going back at least a few months and a box of highlighters. Go through it with a fine tooth comb and do the maths to get a realistic picture.

According to your SOA, you should have north of £200 a month 'spare' but clearly this is not the case. Therefore, your accounting is incorrect and therefore, useless. You need the truth, not whatever fantasy numbers 'seem' right.

You should also look very carefully at proper accounting software (or the nearest normal people need to get to it). You Need A Budget dot com will get you what you need. The price seems high, until you get yourself in a mess like this, then it's worth it's weight in gold. I've been using it for several years now and I cannot imagine a day when I will go back to not using it or something like it. Absolutely essential in our modern world and especially if you dont use cash. It is too easy to lose (lie to yourself) about transactions and then end up in the mess you are in. This will put a stop to it. At least get yourself a spreadsheet from https://www.vertex42.com and do some proper accounting. You would not expect a business to run without accounts and HMRC for sure wouldnt tolerate such behaviour, so why do you imagine you can run a mult-thousand pound annual household budget with finger in the air estimates and guesses?

The 300 is in addition to what is on my SOA, I have not accounted for that. So if that does come in, then it would go straight into paying off. The SOA is what is guaranteed to come in every month.
Remember I have only just started this job, so I am just catching up and getting everything into one place.

Pday loans - all have been emailed, and still awaiting replies from several of them. Only quickquid have come back to myself and we have come to an agreement.
All interest has been frozen on all accounts. So what is stated, is what has to be paid out.

david756

sarlouwoo wrote: »

Hi David, presumably as your season ticket loan is taken before tax, then this has already been accounted for and therefore shouldn't need to be on your SOA? This would mean that you have an additional £441 available each month according to your calculations so, as indicated above, there must be things missing from your SOA...

Well no, that is a cost that I have to pay every month. I can take it off, but wouldn't see much difference as it all tallies up at the end.

david756

ellesbellesxxx wrote: »

Can I just check - do you really only spend 50 a month on food???

The only areas I can really identify to cut back on are: mobile (either try and go down a tariff or switch to sim only deal, eg giffgaff)
landline/internet - you can get great deals by haggling too!

You have been given excellent advice though so good luck!

Yeah, I have a lot of basic meals (pasta, rice etc), only eat meat once a week.

Could look at phone, but tied in until March.

david756

Ah can't access Vertex (work blocked the site, shall have a look tonight).

FireWyrm

david756 wrote: »

Ah can't access Vertex (work blocked the site, shall have a look tonight).

Its a perfectly safe site filled with free excel spreadsheets for all sorts of purposes. Nothing NSFW there at all.

You need to get a real picture of your situation as a matter of urgency. The only way to do that is to either wait until the end of next month and use a spending diary, or analyse your previous spending patterns based on historical data. At the moment, I'm willing to bet those categories do not cover your actual spending patterns and that they are not particularly accurate anyway. Anything less than an accurate, down to the penny budget is frankly useless. So many people try to run their lives off the back of a scrap envelope and wonder why it all falls down around their ears. Either use Excel (one of those spreadsheets), some accounting software like (YNAB) or an accounts book if you have to, but running your budget without accurate starting figures and ruthlessly recording every expense no matter how small, is pointless.

You SOA says you have £200 a month spare. This is a lie and the first one you need to deal with. It doesnt matter what amount you really have spare at the end of the day, but you need to know exactly what it is. I realise you have only just started, and this is the 2nd of the month - a good time to start, but your SOA needs to be better than that. For instance, do you never buy a magazine? You never buy a coffee? You never eat a burger at McDonalds? You never spend more than £20 a month on entertainment, or less? All of these will have a bearing on your actual budget. Your SOA is a good start, but your job isnt finished yet. Much more to do and like giving up smoking or alcohol, you cannot afford to be anything less than vigilant going forwards and for the rest of your life.

sarlouwoo

david756 wrote: »

Well no, that is a cost that I have to pay every month. I can take it off, but wouldn't see much difference as it all tallies up at the end.

The Income section of the SOA asks for your income after tax has already been taken so I assumed that the £1,400 was what actually gets paid into your bank each month (i.e. after tax, national insurance and season ticket loan has already been taken out). If this is the case then you are accounting for it twice.

fatbelly

fatbelly wrote: »

Given the current climate we should be encouraging more people to complain about their payday loans.

I am surprised there isn't a guide on this site.

There is one now

http://debtcamel.co.uk/payday-loan-refunds/