No longer consolidating and my SOA...

Mr_I_Need_It

Hello, I'm a newbie with new found debt I had been ignoring and hiding from for some time. It's at around £26,400 which came as a big shock especially since my wife announced I will be a dad in 8 1/2 months.

As I briefly mentioned on an earlier post I was just about to apply for a secured loan which I was convinced was the right decision, (been watching too many of them consolidation adverts!) however since reading some helpful posts on here I'm going for the snowball solution and some self control. So here is my SOA, if you have any suggestions please let me know.

SOA

My salary is £1531 with quarterly bonus of £1500 (normally spent 2 quarters in advance)

monthly outgoings

Mortgage £471.74 (interest only for the mean time)
Council Tax £101
Gas and electric £80
Water Rates £31.26
TV, Broadband and phone £59.40
Mobile Phone £45 18 month contract
Home Insurance £31.85 includes bicycles
Help the aged £7.00 (A woman hugged me in the street to get me to sign up!)
Website £5.86
Lottery DD £12

Loans

Northern Rock £137.24 Balance £5000
Cahoot £151.63 Balance £8500

Credit Cards (minimum payments)

Egg £35.43 Balance £1800
Halifax One £79.70 Balance £4100
MBNA £118.00 Balance £5000
HSBC £75.00 Balance £2000

Overdraft:

£900 used each month.

Looking at my statement my spare money is going from my account in numerous cash point withdrawals and card transactions on various everyday things and nights out.

Is snowballing the best route to take? I'm quite sure the consolidation loans is not the way to go..

It does make me a bit sick when I think about the above debts but I do feel a bit better now I've read other posts on here.

mrcow

Mr_I_Need_It wrote: »

Hello, I'm a newbie with new found debt I had been ignoring and hiding from for some time. It's at around £26,400 which came as a big shock especially since my wife announced I will be a dad in 8 1/2 months.

Congratulations, but sorry to break it to you but no one can tell for sure if they are only two weeks pregnant

You're probably going to be a Dad in less than 8 1/2 months........

petetidball

Congratulations on the impending child. You need to add APRs to the debts and put in all the bits you've missed out like food and TV licence and going out etc. I know it's a pain in the !!! but when you do write it all down, you can see where the withdrawals from cash machines go.

From what you've written, I'd suggest scrapping Help the Aged ( charity has to begin at home and it's a pack of nappies a month), find cheaper broadband/TV etc an mobile, and cancel the Lottery DD. Other than that, snowballing is great if you have the money to pay your debts off, so give it a go!

tyllwyd

I agree that you need to give yourself a full budget, allowing for food, car (or other travel) expenses, clothes, spending money and keep track of it on a daily basis - if money is that tight, you need to know when you are close to overspending on something, so you can make a decision what to do.

calleyw

Hello,

I agree you need put more detail in.

You can pay council tax and water rates over 12 months and not 10 that will help a little bit.

But the things that jump out at me are

TV, Broadband and phone £59.40 -got to cut it right back. If with virgin check out there deals 3 for £30 a month
Mobile Phone £45 18 month contract -far to much cut back to bare min contract
Home Insurance £31.85 includes bicycles - you are paying for building and contents over £300 a year if you are paying over 12 months need to get that down. Look on line.
Lottery DD £12 -sorry has to go

From SOA you don't eat or run a car. Also is there is a reason why your wife does not work as there nothing about her income or Child Benefit or Tax credits if you already have children.

You do need a spending diary for the both of you. To see where and when you are spending money.


Also all the best abut being a dad.


Yours


Calley

rayday2

mrcow wrote: »

Congratulations, but sorry to break it to you but no one can tell for sure if they are only two weeks pregnant

You're probably going to be a Dad in less than 8 1/2 months........

Pregnancy anorak alert here! lol

You are pregnant for 40 weeks that is 10 lunar months so therefore it is possible to find yourself from a positive result with 8 1/2 months to wait lol Of course first child that could even be 9 months if they dont play ball

mrcow

rayday2 wrote: »

Pregnancy anorak alert here! lol

Pregnancy anorak! now there's an interesting hobby

You could set up a folding chair in Mothercare and record details of passing ladies! (before you get kicked out that is!).

OP, I've been thinking too, if this is your first baby, maybe it's worth having a think about putting some money aside in your SOA for saving up for when the baby comes. It's never too early to start planning. Most things that you need to get shouldn't cost a fortune, especially if you have other babies in the family that you can reuse equipment from (cots etc.) but still, things do tend to add up and it's worth bearing that in mind.

rayday2

Mrcow has a good idea there, not about camping outside Mothercare but saving up would be good, they are not as costly as we assume and strange people suddenly want to buy you things but it is nice to feel you have the money for things!

Badger_Lady

First thing that jumps out at me - you're currently paying minimum payments on credit cards, but you should change this to a fixed amount (see Martin's Article). This means you'll carry on paying the amounts you've listed above each month, but your balance will drop more quickly.

I've recently started using www.spendingdiary.com to record my "miscellaneous" expenditures - I'm always shocked to realise how much I spend on "luxury food" and "alcohol", whether it's picking up a snack at the train station or going for a night out with friends. Because these things are done in cash, you have to start recording them before you even notice what you're spending unnecessarily!

What's the "Website" expenditure? Does this bring you an additional income / could you add some referral links to help?

petetidball

I agree with the idea of trying to save. But if you can't, it's not the end of the world either. There is always Freecycle where you can get baby stuff second hand for free and family and friends tend to be a good source of hand me downs. If you're in a Sure Start area I think you can get grants and stuff too, but I'm not so I'm not sure about that. I know you (or the missus) will probably want all new stuff (my wife did) but sometimes it's not practical. Half the reason I'm on here is because we spent more than we could afford when we had our daughter! But she is worth it (most of the time).;)

And I'd suggest not loitering in Mothercare, they don't take kindly to it. Especially not around the maternity bra area.........