Small overdraft, struggling to lower it

louby40

I don't have a great deal of debt but I find myself overdrawn every month which seems to go round and round and I never seem to build up a buffer. If I could build up a reasonable credit in my current account I would be fine.


What I have just done over the past week is move bank accounts from a Santander 123 account (I was getting about 45p every month after the £5 monthly charge & paying £17 in charges) with an arranged overdraft facility of £600 to a First Direct current account with an overdraft of £250 and a £100 incentive to switch. I've also moved my £1000 Barclaycard debt to First Directs 0% Credit Card for 27 months which I will pay £100 a month off.


I've done the MSE budget calculator which says my monthly overspend is £71


Ive also put a few things on Gumtree and local Facebook sites but they are only clothes/shoes/bedding so not mega bucks


Is there anything else I can do?

Gazzafatcityboy

Hi there,


I didn't want to read and run but I think it comes down to two things.


1- SOA - see where you can cut down any expenditures.


2- Get more income into your account.


What job do you do? is there any opportunity there to earn more?


Regards,


Gary

gizmorat

As Gazza says first thing is to make yourself a Statement Of Account here

stoozing.com/calculator/soa.php

It'll take a few attempts to account for everything but you should have a really good start from doing the MSE budget calculator.

Second post it on this board for people to help you understand where you could be saving money. (Press the MSE button in the "Format results for discussion boards" section of the SOA calculator. Then cut and paste the text into a new post.

Third based on the feedback you get put yourself a monthly budget together that includes saving for a buffer. You might find using a budgeting app such as Goodbudget or YNAB useful.

Goodluck

louby40

I'm a teacher and single parent to 2 boys. I can't earn anything extra (or even want to) my job is demanding and stressful.

I've just gathered together £20 of CD's and DVdS and MoneyMagpie are coming to collect them tomorrow.

No luck with anything I'm selling.

I'm paying my parents back £300 a month at the moment too which will be done and dusted next May time. They lent me £6k last year when I split with my ex and I bought my own house.

I earn a decent salary but go into the red every month.

I tried to do a SOA but it kept saying there was a problem with one of the debts so I gave up.

Thanks for your advice.

kazwookie

Is the children's father paying towards the children?

Can you take a lodger in

louby40

Yes the boys dad pays towards them and no I don't have the room to take a lodger in.


I did do it before, when my ex stopped paying the mortgage, I had 2 lodgers (as i then lived in a 5 bedroomed house) and it paid my exes half of the mortgage. It wasn't ideal but was a means to an end whilst the house was on the market. I did it for 6 months.

louby40

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 1
Number of children in household......... 2
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 2170
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 415
Total monthly income.................... 2585
Monthly Expense Details
Mortgage................................ 600
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 133
Electricity............................. 20
Gas..................................... 35
Oil..................................... 0
Water rates............................. 33
Telephone (land line)................... 17
Mobile phone............................ 45
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 5
Groceries etc. ......................... 250
Clothing................................ 30
Petrol/diesel........................... 30
Road tax................................ 12
Car Insurance........................... 26
Car maintenance (including MOT)......... 10
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 20
Medical (prescriptions, dentist etc).... 8
Pet insurance/vet bills................. 0
Buildings insurance..................... 8
Contents insurance...................... 8
Life assurance ......................... 17
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 20
Entertainment........................... 15
Holiday................................. 0
Emergency fund.......................... 0
gym..................................... 18
union fees.............................. 18
Total monthly expenses.................. 1420

Assets
Cash.................................... 0
House value (Gross)..................... 180000
Shares and bonds........................ 0
Car(s).................................. 8000
Other assets............................ 0
Total Assets............................ 188000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 106000...(600)......2.6
Total secured & HP debts...... 106000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Credi card.....................1000......30........18
Car loan.......................6000......194.......11
Parents........................4000......300.......0
Overdraft......................400.......400.......0
Total unsecured debts..........11400.....924.......-

Monthly Budget Summary
Total monthly income.................... 2,585
Expenses (including HP & secured debts). 1,420
Available for debt repayments........... 1,165
Monthly UNsecured debt repayments....... 924
Amount left after debt repayments....... 241
Personal Balance Sheet Summary
Total assets (things you own)........... 188,000
Total HP & Secured debt................. -106,000
Total Unsecured debt.................... -11,400
Net Assets.............................. 70,600
Created using the SOA calculator at www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using other browser.

louby40

The mobile phone amount is for 2 phones. My sons contract comes to an end in October when he will be moving onto a PAYG contract with 3.

andyfromotley

Hi Lou,

well something isnt right.

According to your SOA you have £271 to left over after all of your bills every month. Also you have counted £400 toward your OD repayment every month but of course you dont repay this every month, just the charges. So you should have £671 left over every month. I'm guessing you haven't?

So this SOA in reality is a wish list, but thats ok its a godd place to start. Comb over your bank statements the last few months to see where the money has been going.

You need to set a budget on the day you get paid, allocating the money to certain 'jobs' pretty much like the SOA above, and then you nedd to stick to it come hell or high water. If you havent budgeted for it then it doesnt get spent. This budget can be on a bit of paper, a spread sheet or a fancy programme like YNAB (which i highly recommend.) How you do it doesnt matter, sticking to it does!!

Using a forward looking budget like this, and sticking to it is the best way to get a grip of your spending and become debt free.

On the face of it you have plenty of income and could be out of debt pretty quickly if you follow the advice above. I tip my hat to you and all single parents working hard to succeed. You can do this, i know because I in my 40's have learnt how to manage my money and the results have been staggering. So get to it!!

louby40

Which is better YNAB or Budgetplanner


Im just about to switch banks (on the 1st July) so I may be better waiting until that happnes to make full use of the 34 day free trial?

Anawi

Hi sorry - I only have time for a quick reply. Do you claim or are you entitled to claim child benefit for your two children? Could help make a difference.