Oh to be debt free - a dream or reality?

craftydreamer

Thank you for reading and those who commented for your help. I have decided to remove my information as I felt a little over exposed but really thank you for your advice.

sourcrates

Hi,

Welcome to the forum.

I notice you've only put £50 for food per month, I spend that a week at least, so that can't be a realistic value surely ?

There's also some other big gaps in your budget, I suspect when it's all boiled down you don't have the £300 odd pound excess left over that you think you do.

nkkingston

£29.10 is too high for a monthly tv licence payment, unless you're all paying off arrears. You've got £20 a month down for presents, with is £2400 a year. Do you really spend more on petrol each month than on food? You never buy new clothes or get your hair cut, but you've got £58 a month to spend at the gym?

Now, i have half a suspicion why some of these figures look weird is because you're not the only member of your household. Is that right? If so, you really need to work up a whole household budget, not just your share, or it's going to be impossible to keep it balanced.

If it is just you and the lodger, then you're not being honest with yourself about where money is going, or you'd have £300 a month to put into savings, instead of struggling along as you are. Get out the last three months' statements and figure out where every penny has gone. I know this covers Christmas, which makes it feel skewed, but that will be useful in seeing whether you actually need to put £20 aside each month towards presents or not.

craftydreamer

Welcome to the forum.

I notice you've only put £50 for food per month, I spend that a week at least, so that can't be a realistic value surely ?

There's also some other big gaps in your budget, I suspect when it's all boiled down you don't have the £300 odd pound excess left over that you think you do.

Thanks for your reply Sourcrates,

Yes, £50 does not seem much a month for food but is accurate as I get food paid for from work as I'm away for a couple of days and week and eat at my friend's house, parents and partners the rest of the week. Most of my shopping is yellow label so really keep a tight reign on it. The reason for the excess in my payments is because I have just had a payrise and have taken a lodger on at the same time. This has meant an increase in in my income of £600 per month. I was overpaying on my mortgage and am now about to renegotiate a new term which will be at a far better interest rate. All these factors will help in being able to repay sooner. My biggest concerns are to ensure that I don't let the extra money fritter away. I wondered whether a spending diary would be helpful?

takman

You shouldn't be worried about posting on here nothing you have written containts sensitive information and it all anoymous anyway!.

craftydreamer wrote: »

I've been in debt most of my adult life. Not just owing on a mortgage but holding credit cards and not dealing with debt as I could have done. This year I feel I need to start to resolve this. I know it will take me years if I have to continue to re-pay at the interest levels I currently have on my cards so would appreciate any recommendations on how I can reduce this. I'm at the end of one mortgage deal and about to start another. I've tried to raise my mortgage amount without success (and to be honest not sure that this would be the best idea).
My SOA is below:

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Income from Employment (after tax). . . . . . . . . . . . . . . . . . . . . . . 1,666.00
Income from Self Employment (before tax). . . . . . . . . . . . . . . . . . . . 0.00
State Pension . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Private Pension / Annuity Payout. . . . . . . . . . . . . . . . . . . . . . . . 0.00
Benefits (Inc. Child Benefit/Tax Credits & Income Support). . . . . . . . . . . 0.00
Income From Savings & Investments . . . . . . . . . . . . . . . . . . . . . . . 0.00
Gifts From Family / Friends . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Rent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 360.00

Monthly Expense Details

In Your Home

Mobile phones . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.39
TV licence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29.10
Internet. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27.00
Home phone. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Cleaning products/Cleaner . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Garden maintenance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Household maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Oil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Electricity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.00
Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.00
Water . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.00
Council tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125.00
Overdraft cost. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.00
Bank account fee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Home insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19.08
Mortgage/Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 386.00
Plumbing/Boiler cover . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Mortgage life insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Mortgage payment protection . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Life insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.86
Food and household shopping . . . . . . . . . . . . . . . . . . . . . . . . . . 50.00
Drinks for home . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00

Motoring & Public Transport

Petrol/Diesel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60.00
Parking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Car tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.37
Car insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.01
Car maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Rail/Buses/Taxis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Breakdown cover . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00

Debt Repayments

Credit card repayments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 340.00
Hire purchase repayments. . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Personal loan repayments. . . . . . . . . . . . . . . . . . . . . . . . . . . . 224.00
Car loan repayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Mum and dad . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00

Savings & Investments

Pension payments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Buying shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Cash ISAs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Lump sum saving . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Regular saving. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00

Family

Pet food. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
School trips. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
School meals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Pocket money. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Nappies/Baby extras . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Laundry/Dry cleaning. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Children's travel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Baby-sitting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Childcare/Playgroups. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Pet insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Travel insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00

Entertainment

Satellite/Digital TV. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Family days out . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Cinema/Theatre trips. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Books/Music/Films/Computers . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Big days out. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Shopping for fun. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Pet costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Hobbies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
IT/Computing (antivirus, etc) . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
DVD rental. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Drinking out. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Eating out. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86.67

Clothes, Health & Beauty

Complementary therapies . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Optical bills . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Haircuts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Dentistry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Beauty treatments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Healthcare cash plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Dental insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Private medical insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Fitness/Sports/Gym. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58.00
Work clothes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
New children's clothes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
New clothes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00

Education & Courses

University tuition fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
School fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Your courses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00

Big One-Offs

Funeral expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Wedding expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Sofa/Kitchen/TV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Birthdays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.00
Winter holiday. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Summer holiday. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Christmas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00

Odds & Sods

Newspapers and magazines. . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Tax & NI Provisions (self-employed only). . . . . . . . . . . . . . . . . . . . 0.00
Regular charity donations . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Meals at work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Smokes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00
Coffees/Sandwiches/Snacks . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.00


Total monthly income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,026.00


Total monthly expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,569.48




My credit cards are as follows:-

MBNA - £3273.25 - 18.9% - Min monthly £82.40
Barclaycard - £4300 - 26.18% - Min monthly £112.00
Lloyds Bank - £1950 - 14.94% - Min monthly £50.00.

I have used my available credit on my credit cards and now have to use money from my current account each month to pay work expenses which take two weeks to be refunded. I have constant cash flow problems. In addition to this I owe my parents £2,500 as they helped me pay to have my bathroom renovated..

I have recently had a pay rise and have taken a lodger to help repay these debts faster. I've also been offered an incentive scheme at work with the potential of £250 extra a month if I can get to target. Whilst I realise I can't rely on this it will give me more encouragement to try.

Any advice would be most welcome. Thanks for reading.