Cheeseface makes a plan

Cheeseface

Hello!

I used to post regularly on MSE and then changed my email address, forgot my username and couldn't post. I was in a lot of debt back then, hardly any money left after paying bills and generally making a mess of things.

Over the years we paid all debt off, saved up for a deposit on a larger house, moved house and made some improvements to it. However now we have run up some debt on the credit cards and I'd like to focus on paying it off.

We, hubby and I, have been fully aware of the debt, it hasn't mounted up with out us knowing. It's just been down to poor planning!

Our eldest had driving lessons, which I promised to pay for. I wasn't planning on him being such a slow learner because he tends to excel at everything he does, except sports. I then paid for him to be insured on my car so he could consolidate his driving and drive to work over the summer. He saved up money to take to university so I didn't mind. Then he went to university and we give him money towards his accommodation. However I expected this to be paid monthly but the university take a large deposit and the payments in October and January. The last payment is to be paid in April with the large deposit deducted from that. I hadn't budgeted this way and it was more than I expected so that's made a difference. He is paying the April instalment and I have already given him the January money so that's All covered until next academic year.

We also just had a massive holiday where we spent on the card. I don't regret it, it was the best holiday ever.

However now we are home and need to focus on the credit card debt.

We owe £500 to Next, £4920 on a 0% credit card and less than £100 on our 'everyday' credit card. We use the everyday card for buyer protection and emergencies etc.

We do have an ISA which is for serious emergencies (such as unemployment) so to be ignored and a regular savings account with just over £400 in.

I've started the diary to make myself accountable and focus my mind. Wish me luck.

Cheeseface

Wow. That was a lengthy post, and I'm still going.

The long term plan so far

• Make a spread sheet of all finances
• Fill in spread sheet daily
• Set daily budget at start of month
• Allocate monthly payment to debt repayment

Since we got out of debt the first time (which was well over £40000 at one point) I have always been good at checking my direct debits, ensuring we aren't on cheapest tariffs, price comparisons and always minimising costs wherever possible. We've reclaimed PPI successfully too. I can't really do more. We've just remortgaged into a great fixed rate as we got a better LTV this time.

Our problems have come from thinking that we earn good money so can spend good money, but not paying attention to how often we are spending!

After all our direct debits are paid we are left with £1500 ish per month which is a really decent amount so I can crack these debts in no time. My wages fluctuate so it can be difficult to plan. However I have worked this out with my minimum wage and any extra I earn will go straight to debt.

From the £1500 I have allocated the family £30 per day. This is for everything that we need to buy. Food, petrol, clothes, going out, window cleaner, etc. Our main vice is eating out, we also have a younger child at home, so meals for three soon add up. I have only just started to track where our money goes so I will review that in January.

I also have a self employed job which I keep separate. This money I always save up for extra spends when we have holidays or weekends away. I get paid in cash so it doesn't enter the bank account, I have just had a tax bill for £150 but I have this put aside.

So on average that will give me £600 a month to throw at debt, but I need to think about next year's uni costs. Any spare into the savings account.

So short term plan for December

• Live on £30 per day as a household
• Buy remainder of Christmas presents on everyday credit card
• Pay off Next account on payday
• Minimum payment to 0% card
• Remainder to everyday credit card
• Pay tax bill

Any advice will be greatly received!

EssexHebridean

Welcome aboard (again!) - you know already where you went wrong last time by the sound of it - so that's a good starting point and putting a proper budget in place will hopefully help stop the same thing happening again.

Is your plan to get rid of the credit card/store account debt, build an "everyday" emergency fund to supplement the "serious emergency" money, and then to start battling away at the mortgage debt as well? With the level of surplus you will have once the initial stuff is dealt with, and the low rate you say you've got on the mortgage currently, it would be a fantastic time to hammer away some of the capital and "future proof" yourself against rate increases in the future.

Good luck!

Cheeseface

Thanks for the welcome EH!

Once the cards are gone we will probably make some more improvements to the home. I'd liked a new bathroom and then some general redecorating to the hall and landing. By then we will need a new car I imagine but repaying the mortgage earlier has always been the plan.

The regular savings with £400 in it, is an everyday emergency fund. I can use this is if I needed a new computer or car repairs for example. I am not a person for replacing things for the sake of it. I only want a new bathroom as there's no shower , I can't fit one over the bath because it's only tiled halfway up the wall. Our house is 11 years old and there's lots of things that are coming to the end of their life span. Cheapie new build fixtures are slowly giving up.

The husband has informed me that he forgot to apply for his season ticket loan by the deadline.:mad: so he won't get paid it until January payday. Season ticket is due mid January. He is on board with debt repayment and saving but he just isn't focused. It will have to go on the everyday credit card for two weeks. Not ideal but we will pay it off before it occurs interest.

He also needs a car park season ticket which is just over £1000, that's in mid January too. He gets a bonus in March which will pay for it but I'm hoping I can scrape the money together to pay for it by then. He just doesn't plan and think that budgeting means spending nothing rather than being mindful and aware. However he earns most of the money and works really hard for it. I'm in charge of the finances so I just need to keep him up to date.

New short term plan

• Live on £30 a day
• finish Christmas shopping on everyday card
• Pay minimum to Next, everyday credit card and 0% credit card
• Pay tax bill (I could pay this with January wages but I would rather get it paid)
• Buy parking season ticket

I know it seems wrong to put my Christmas spending on the credit card, but that's because I want to get my current account to run as it would normally so I can have better control of it. By next Christmas I will have money in my everyday savings to pay for it.

I also thought about cutting down our daily spends but we need a lot of petrol over the next few weeks for visiting relatives and the eldest is home from uni next week so I'll need more food.

So I will stick to the revised plan, then in March we should get a little bonus from the husband's work to play with :j

roxy7699

Good luck with the plan - following.

Bobarella

Good luck with it all.

jvr

Hi Cheeseface... followed you from my diary. Sounds like you are on top of it and know what you need to do to get out of this situation. Mine is a similar size debt and i know compared to alot of people it might not seem like too much but its holding us back from doing house improvements etc. Cannot wait for the day that any extra money goes towards savings for that and not to the credit cards...
Good luck , looking foreward to following your journey!

Cheeseface

Thanks Roxy, Bob and JVR.

JVR - you're right. Sometimes I feel like some MSE forumites can give others a hard time if they aren't facing bankruptcy or buy the cheapest version of everything. It doesn't seem like that on this part of the forum. I've been reading a while before starting my own thread.

We've had a reasonable weekend. Saturday morning we took youngest to his regular Saturday morning activity. We pay for that monthly so no spends there. We then went out for a late lunch at the local Beefeater, we used a points voucher and had a 30% off main course. As I said before, eating out is our main unnecessary expenditure, but it's all within the daily spending budget.

Food shop this morning which was £42, and should last until Friday at least. That includes all lunches, cleaning products, toiletries and a treat each. Hubby also bought a Christmas jumper for a charity Christmas jumper day at work. This concept is beyond me...everyone buys a jumper (hubby's was £8 from Lidl) then they wear them to work and donate to the charity. Wouldn't the £8 be better going to the charity? Hubby wasn't that impressed but didn't want to look like a Scrooge. Personally I would've sewn a bauble and tinsel onto an existing jumper.

I average the daily budget out so we are still on track. I did have to buy a train ticket to London for tomorrow, I will be able to claim that back from work as it's for a meeting. Our system is very efficient too, I can claim that tomorrow and it will be paid next week. I split the ticket as it saved ten pounds. Seriously ridiculous system isn't it?

I've collected a present for the eldest from Next too. I ordered it a while back but it's only just come into stock. I only have vouchers left to get now, and a bottle of vodka. Pleased that it's out of the way.

I thought of another thing to add to my list of short term plans, I need to buy membership to the Great North Run. I ran it for the first time this year, and got my place through the ballot system. Once you are in, you can buy a three year membership which guarantees entry for £57. Then race entry for 2017 is another £50 on top so I need £107 by the end of January for that. That's my favourite race that I have done. It's not a race to get a personal best, It's too crowded. However, the atmosphere is amazing, with bands playing and supporters all the way around. I'm not running much at the moment. I had a busy year with two half marathons in the autumn and I have a place in the London Marathon so need to start proper training after Christmas. I'm have some time to rest my body.

Cheeseface

Updated short term plan

• Live on £30 a day
• finish Christmas shopping on everyday card
• Pay minimum to Next, everyday credit card and 0% credit card
• Pay tax bill
• Buy parking season ticket
• Buy GNR membership

wishus

Good luck Cheeseface!

Chandelier.

Your plan sounds great Cheeseface!

We are the same in regards to Christmas jumpers. The boys school had two days where they require donations- one wear a Christmas jumper to school day and another wear something festive but they have to wear full uniform. They both recommend a minimum £1 donation. It bugs me. What the heck can a boy wear alongside his school uniform that's festive? Bah.

Hope things are ticking along nicely!