New member. Lots of Debt. Help please

sun_city_girl

Not really sure where to start.

I currently have £15000 of debt

- £3000 overdraft
- £2000 credit card
- £10000 loan

Unfortunately earlier this year I was in a position where I had to leave my job, so I had 2 months of no wage - I had just taken out the £10000 loan to consolidate and whilst I managed to pay off my car with it I ended up having to live off of the rest

I now earn £29366 but on pro rata at 30 hours a week
and my partner also earns about £16000 but also pro rata at 30 hours a week
I am not very good at managing budgets but my partner is a million times worse and is also one of those people that like brands and stuff which is pretty alien to me

the house is in my name shared ownership and costs us about
£400 a month for mortgage and rent
child care is £400 a month
council tax £131
loan is £160
gas and electric is £55
water is about £35
talktalk (phone and internet) £35
my phone is £27
his is about £35
car ins his is £36
mine is £26
food is cheap ish we spend about £80 a week
we pay contents insurance £10
births gas cover £15
fuel £50 a week between us
gym £21 a month me
he pays £25 a month
unison we pay £15 each
we buy rabbit food I guess £15 a month
I have to have contact lens solutions which are about £17 a month

we should easily cover out outgoings plus savings but
i have trouble getting my partner to think about small spending
like buying food at work
buying expensive coffees
buy expensive beers

If we can't pay the stuff in the list we shouldn't buy the other stuff
I don't even know how to work excel but do lists
we never have money to put into
a. savings
b. emergencies
c. yearly fees like RAC and my professional registration

I also feel like I am totally on my own trying to do something about it
we are both in our early 30s and I feel things should be more able by now but are actually worse :-(

Arleen

Cut the phones, get a simple pay as you go, over very cheap plans. Also, why do you need a landline with 2 mobiles already? Similarly, I am sure that you can find gym cheaper than for 46quid/month for two people.

But what is most obvious from your statement is that you need a spending diary, because you are guessing at the most important sums like food, which means that you don't know how much do you really spend there. A month noting down every penny spent will open your eyes.

You can then show those numbers to your partner and sit at them together about the extra spends, like expensive coffees, as I am sure that both of you have some guilty spending pleasures.

Mnd

Regarding the phone bill, we pay 20 a month for 2 phones..texts calls and interet. .well known supermarket beginning with T

chelseablue

Are the phones still in contract?
As soon as my 24 month contract was up I didn't need a new phone so switched to a SIM only plan, bill went from £35 a month to £8

sun_city_girl

Thanks for the replies

The mobiles are both not that far into the contracts, I think they are pricey because of data - mine is actually so I can get extra work via an agency work app I have - so I guess it was to keep me connected.
My partner just wants lots of data so he can browse the internet on his phone. They both have ages to run unfortunately.

Our landline is only used for the internet :-/ we have no phone.

The gym I thought was really cheap - it's our cheapest that also gives me swimming so I can take the toddler. I have off peak corporate membership and my partner has peak corporate.

As for a spending diary it sounds like a good idea I guess I would need to take it everywhere so maybe something small :-)

Mnd

Looking through your bills it's seems like most of them are reasonable, tbh even the gym doesn't seem steep, it just looks as though you could cut back that but would prefer not to, that just leaves the attitude to spending to tackle, which may be a bit more difficult. Good luck

sun_city_girl

Yes our outgoings I think are cheap in terms of essential spending.
We are lucky mortgage and rent is cheap and we have solar panels so bills are cheap
It is just a problem keeping track of spending. I currently have 2 current acoountsboth at their overdraft limit both with direct debits coming out of them
Also me and my partner get paid about 10 days apart so that doesn't help working out what we have
Can you get lessons on such thing!!?

sun_city_girl

I think the gym is important as it helps me stay off of mental Heath meds it is also good to be able to take the toddler swimming :-)

foxgloves

Hi,
I think this all really just comes down to you having no budget in place. I suspect that your food spend may be higher so getting statements out & adding up every food spend over the past month would give you a more accurate picture. Before we saw the light with all our debts (over 30k at its worst), we wasted heaps of money on buying lunches out, endless coffee shop visits often more than once a day & take-aways at least weekly. We worked out that by taking packed lunch to work, we would save £2000 a year! When you see that kind of figure, you realise the truth about sorting out debts. It's about choices. We can spend 10 mins on an evening making packed lunches & free up £2k to help get rid of our debts a bit quicker OR we can continue to give that money to Costa or M&S or whoever in exchange for expensive sandwiches & they ARE expensive when you consider that you can buy a loaf of bread for less than £1. It's a choice. Making loads of small right choices on a daily basis means that you have chosen sustainable budgeting over debt. Ignoring them means that you are choosing debt.
There are no children in our household. Our grocery budget is between £200 & £250 a month to feed me, my partner (who is a big guy with a colossal appetite) & a greedy cat. This sum includes all our food, cat's food, cleaning products & basic toiletries. We eat really well, very little processed food, no ready meals, etc. The key is meal planning & a proper shopping list. Our debts started as students & we didn't address the problem till we were in our 40s. So from experience, I can tell you that regardless how good a joint income, without a budget in place, the debts don't shrink, they grow. Recognising the difference between a want & a need was massively key to our success. Good luck!

National_Debtline

Hi sun_city_girl

Welcome to MSE. I’m sorry to hear you were out of work for a time, I understand how that would have made it harder than usual to deal with your finances. A good place to start is by completing a statement of affairs (SOA) http://www.stoozing.com/calculator/soa.php. That way you can make sure you have enough to cover all your essentials and afford your debts. It will also take in to account those outgoings that may only come up annually, it’s important to budget for those too.

If you have spare money left over you can think about how you want to use that, for example paying off debts quicker or savings for emergencies. And once you’ve done that you can see what is left over for any luxuries you may want to treat yourself to.

If you find that the debts actually aren’t affordable then there is help available from one of the free debt advice agencies. If you post your SOA back on the forum you’ll get lots of useful ideas from the other members on ways to save money and improve your situation. Good luck with it all.

Susie
@natdebtline

EssexHebridean

Comments in red below - also note the words I've highlighted in your original post -
this is the root of some of your problems...

sun_city_girl wrote: »

Not really sure where to start.

I currently have £15000 of debt

- £3000 overdraft
- £2000 credit card
- £10000 loan

Unfortunately earlier this year I was in a position where I had to leave my job, so I had 2 months of no wage - I had just taken out the £10000 loan to consolidate and whilst I managed to pay off my car with it I ended up having to live off of the rest

I now earn £29366 but on pro rata at 30 hours a week Ignore the original figure -= what you need to know is your actual monthly income - the overall annual figure is irrelevant as with it being on a pro rata basis this is not your income!
and my partner also earns about £16000 but also pro rata at 30 hours a week Same as above
I am not very good at managing budgets but my partner is a million times worse and is also one of those people that like brands and stuff which is pretty alien to me If the debt is joint he probably needs to get over that sharpish. As for not being good at managing budgets - learn, and learn fast!

the house is in my name shared ownership and costs us about
£400 a month for mortgage and rent No service charges?
child care is £400 a month Do you use childcare vouchers to reduce the costs?

council tax £131 You can split this over 12 months rather than the standard 10 if that helps.
loan is £160
gas and electric is £55
water is about £35
talktalk (phone and internet) £35 Have you checked this is the best deal you can get?
my phone is £27 Go SIM only as soon as possible
his is about £35 Go SIM only as soon as possible
car ins his is £36
mine is £26
food is cheap ish we spend about £80 a week No idea for how many people but if that's for 4 or more then vaguely reasonable. If for three you can knock it down a reasonable amount
we pay contents insurance £10
births gas cover £15
fuel £50 a week between us
gym £21 a month me Probably needs to go, bearing in mind the debt.
he pays £25 a month Yes, his too. Run outside maybe? Find free exercise equipment in local parks, be each other's personal trainer
unison we pay £15 each
we buy rabbit food I guess £15 a month
I have to have contact lens solutions which are about £17 a month That sounds expensive. can you switch to buying lenses online and go with disposables so saving yourself the cost of solutions? Otherwise just shop around for th solutions

we should easily cover out outgoings plus savings but
i have trouble getting my partner to think about small spending
like buying food at work
buying expensive coffees
buy expensive beers He needs to get on board and realise that something needs to give.

If we can't pay the stuff in the list we shouldn't buy the other stuff
I don't even know how to work excel but do lists
we never have money to put into
a. savings
b. emergencies
c. yearly fees like RAC and my professional registration Yes, this is where a working budget comes in

I also feel like I am totally on my own trying to do something about it
we are both in our early 30s and I feel things should be more able by now but are actually worse :-(

OK - it's pretty impossible to see from that what your real situation is so my suggestion is that your first stop needs to be to use the SOA calculator on here (in the sticky post at the top of the board) to actually put together a proper, factual budget. Be as accurate as you can - use a years worth of bank and card statements. Post the SOA into this thread and we can take a proper, informed look and advise on your best steps forward. If it shows a surplus (which it probably will!) then step two is to work out where that surplus is going, if it's not still sitting in the bank at the end of each month.

Step three I'm afraid is a tough one - get all your facts and figures together, sit down with OH and tell him that things need to change. Be careful not to apportion blame - use "we" a lot rather than "you" for example - but if you're going to sort yourselves out he has to be on board with it too. A useful thing to have might be the approximate annual figure he spends on the things you've mentioned - so as a rough guideline if he buys a £3 coffee every workday that's £700 a year. £5 for lunch every workday is £1175 a year. £30 weekly on expensive beers would equate to over £1500 per month. See where I'm coming from - £3, £5 and £30 don't sound like huge figures - but the total for those would be nearly £3,500 per year and that IS a lot.

I note your comments about the gym but you can get the same for free outside. As for the swimming look for a pool that does free swimming for under 8's - a lot do - and then go at off peak times when it will cost you less as well. If anything being out in the fresh air is even better for your mental health - even just a 20 minute walk in daylight at lunchtime can help keep the black dog at bay, trust me on this!

I'm going to buck the trend on not needing a landline - with a child in the house and with no idea of how reliable your mobile coverage is I'd say that for emergencies this is not something to give up. Just get it as cheaply as you can.

No TV license on there? Is that correct?
No road tax or car maintenance costs on there - you need to budget for this. For two cars we cover insurance, tax, service, MOT and basic depreciative items by setting aside £160 a month plus we have an emergency fund ready and waiting for any repairs bills not covered by this.

Groceries - We spend £150 a month on food/cleaning stuff for two adults and we eat well - but cook everything from scratch and buy very few branded items. Look at Martin's guide on saving money on your shopping - there's some great info there which will help.

It's fixable, but you do need to learn to budget. You already know that consolidation doesn't work - you've just found yourself in a deeper hole as a result of that, so you need to work on tackling the debt from the ground up.

Oh yes - the bits I've highlighted in your original post. "About" and "I guess" - nope - you need actual, factual figures - THAT is what a proper grown up budget is - not a series of guesses.