Lightbulb moment- didn't have a clue!

katelu

Hi all,
This is my first time posting and I only found out 2 days ago the level of the debt we are in as a family. I had no idea that my husband owed quite as much as he does and have done a soa to show you all whats going on. Still in quite a bit of shock but know my hubbie did it for what he thought were the right reasons (although I wish I had known about this earlier) and I am VERY serious about sorting this out as quickly as possible and am horrified that we owe in the region of £75000!!!! Okay here goes

Monthly Incomings:

My salary - £1,732.00
Partners salary - £1995.00
Benefits – child benefit £116
Tax credits £41

Total - £3884

Monthly Outgoings

Mortgage/Rent – taken out of salary before paid
Council Tax – n/a
Gas - £40 *
Electric - £30.53 *
TV License - £10.99
Phone/internet - £40
Food - £600 **
Car Insurance - £52.50
Petrol - £390
Life Insurance £23.78
Mobile phones £45
Childcare £980
Home and contents insurance £37.92
Childrens savings £50
Kids activities £15
DVD’s £8
Professional memberships £18
Food box £60 ***


Loan 1 - (£5700.77) £145.65
Loan 2 – ( 27452.67) £408.30
MBNA loan – (24533.75) £462.25
Student loan £98.54

MBNA card (6499.34) @ 2.2% £150
Barclaycard (4080.15) @2% £165
Amex (7054.10) @1.9% (?) £175
Capital One(372.30) £30
Next (99.50) £20
Debenhams £30
Mothercare (243.40) £20
Sofa’s (1194) @ 0% £99

Total: £3205.46
That leaves £678.54 at the end of the month which will now be going as extra payment on cc's.

* will be putting these on direct debit asap and looking into possibly changing suppliers

** just pure madness considering there are 2 adults and 2 under 4's in the house!:o

*** just cancelled.[


Just totally horrified we have ended up here and so shocked. Any advice greatfully received.

Paula x

MRSMCAWBER

Hi there katelu and welcome on board...

im sure you get no end of great advice on here soon but i just wanted to let you know that you arent on your own:D ..

my hubby did similar about 6 months ago....:mad: i happened to find out about a loan he had taken out, and like your hubby it was "for the right reason"... still after i had come down off the ceiling:D and warned him that if there was anything else he had better tell me as if i found out down the line that there was another one "he would be wearing his dangly bits for earrings".. i got him to sit down whilst we went through everything......

luckily we have never missed any payments etc or fell behind on bills as everything either came out of his wage before we got it, or by direct debit....so even though we have a fair bit of debt its still manageable.. but i can think of better uses for our money:rolleyes:

He now leaves his bankcards at home....he still has some cash of his own for golfing/bowling, but if he has cash in his pocket he knows he will spend it...so the debit cards stay at home....

Looking at your SOA the first thing i would go for is your food bill - but you know that allready i see;) .... i found that the easiest thing to attack... in fact i am having a go a dbelles feed 2 for a month on £60 this month:rotfl: ...
if i can do it then this months housekeeping can go untouched :T ... and its 500 euros.... yes i know a silly amount for 2 , but if hubby wants to give me that much for food then im gonna take it... that way i can get a bit of saving done for us..if hubby has it he will just end up spending more;)
obviously you dont need to go mad.... even if you just cut it down in steps... say £50 less this month - im sure no-one will even notice,,, if you take a look on the OLD STYLE board you will get loads of advice on how to stretch things....

well i had better stop waffling on, im sure i will pop back to see you soon

Lellylion

I'm new here too, but welcome and well done on your LBM:eek: . Its scary when you write it all down, but once you have changed suppliers, cancelled a few things you don't need and snowballed... Things look a lot more managable.

Someone more knowledgable will be a long soon with some advice. :T

bommer

Welcome and good for taking the step to become df.

Have a look at reclaiming any bank credit card charges. Pay off the cards with the highest apr first.

Mortgage/Rent – taken out of salary before paid
Council Tax – n/a
Gas - £40 * (use quidco when changing)
Electric - £30.53 * (use quidco)
TV License - £10.99
Phone/internet - £40 (you should be able to get a better deal)
Food - £600 ** (this you should be able to reduce considerably - look at the old style board, use coupons, try lidl and aldi)
Car Insurance - £52.50 (You need to check this is the cheapest you can get)
Petrol - £390
Life Insurance £23.78
Mobile phones £45
Childcare £980
Home and contents insurance £37.92
Childrens savings £50 (You should stop this until you are out of debt)
Kids activities £15
DVD’s £8 (You should stop this)
Professional memberships £18
Food box £60 ***


Loan 1 - (£5700.77) £145.65
Loan 2 – ( 27452.67) £408.30
MBNA loan – (24533.75) £462.25
Student loan £98.54

MBNA card (6499.34) @ 2.2% £150
Barclaycard (4080.15) @2% £165
Amex (7054.10) @1.9% (?) £175
Capital One(372.30) £30
Next (99.50) £20
Debenhams £30
Mothercare (243.40) £20
Sofa’s (1194) @ 0% £99

Total: £3205.46
That leaves £678.54 at the end of the month which will now be going as extra payment on cc's.

katelu

Petrol is so high because we both commute to work. However my hubbies work is moving offices in Oct to much closer to us so we won't have petrol for that car to pay for (may even sell the car and buy a banger instead as hubbie needs to take kids to nursery). Thanks for the old style recommendation, already seen a few great tips on their so will have a good look tonight when the kids are in bed.

tyllwyd

My pet hate is Next - apart from the stupidly high APR, you also pay out something like £3.75 for the catalogues every six months plus summer and christmas catalogues and of course you pay delivery - when you look at the whole package it is a very expensive way to do your shopping. I'd get that paid off and cancelled asap if it was me.

CLAPTON

A few things

firstly about the debts

find out all the APRs for the debts.. some you don't have and some you quote at around 2%..these are probably monthly rates, if so in reality you are paying 27% APR or more.

once you have done that put all the figures into the snowball calculator

http://www.whatsthecost.com/snowball.aspx?country=uk

it will tell you how much to pay on each.. the idea is to pay the minimum on all debts except the one with the highest APR .. on that you put as much as possible until its all paid off ; then you start on the one with the next highest APR.. This way you pay the debts of fastest and with the least interest..hence the need to find out all the real APRs of the debts.

secondly. if you credit rating is still good see whether you can transfer some debt to low LOB cards or 0% cards so at least your money is paying the capital off rather than mainly interest.

thirdly... unfortunately your budget has probably missed out quite a few things.. its worth things about all the annual/one off you spend and adding them so you can get a realistic budget and stick to it (like car tax/mot/servicing/RAC, clothes, kids stuff, xmas/presents even modest holiday.... its better to budget and stick to it than spend it anyway.

Mrs._M_7

Interested to know why council tax does not apply

katelu

Thanks for your advice. You are right of course about the interest! As I have a good credit rating (£700 of the debt is mine) would it be worth me getting out a loan to pay off all the credit card bills? I can get one with the repayments about the same a month to pay off the balance in 4 years. Also if I were to do this where can you get free standing ppi?

katelu

We don't pay council tax because my hubbie is in the forces and forces houses are exempt from council tax.

MRSMCAWBER

Hi there Mrs M

the poster might have council tax as N/A as their rent comes out of their wages before they get paid - the council tax may be included in their rent... my hubby is in the forces and thats what happens with us.. the rent/c tax, and because we are overseas the gas, electric and water all come out before his wages go into the bank....

It might not be that, but its one reason i guess