Help! Drowning!

xmas_angel

Evening,

I've never posted before but have been reading the posts from people all seeking advice and guidance and I'm hoping that you can help guide me in the right direction.

So we purchased our own home 2 years ago and since then our debts have spiralled. We've always lived in army accommodation so paying low rent and having a fair amount of disposable income to do what we wanted with each month, including purchasing new cars, mtorbikes etc because we didn't have a mortgage, I always reasoned that they were my mortgage payment. Then we purchased our own home, I'm afraid to admit we went mad, decorating and doing the house up and running up unsecured debts on our credit cards that we then paid off with our loans. Since then on top of the mortgage payment and loan payments we were then using our credit cards for everyday living. I feel like everything has spiralled, we both earn good money but have been stupid with our money and are now regretting decisions we made. Both cars and bike are on PCP deals so can't be sold, my pet insurance is high due to having 2 st bernards who I adore and could not stand to rehome but if I didn't have the insurance any bills would cripple us. I've cut everything out that I can, is there a debt I should be concentrating on paying off first? Where would you start to tackle this? I've posted our statement of affairs as well, any guidance would be greatfully received.
Thank you in advance!

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 0

Monthly Income Details
Monthly income after tax................ 1828.96
Partners monthly income after tax....... 2631.96
Benefits................................ 137.6
Other income............................ 0
Total monthly income.................... 4598.52

Monthly Expense Details
Mortgage................................ 720
Secured/HP loan repayments.............. 644.09
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 124
Electricity............................. 83
Gas..................................... 0
Oil..................................... 50
Water rates............................. 54.54
Telephone (land line)................... 47.2
Mobile phone............................ 47
TV Licence.............................. 12.12
Satellite/Cable TV...................... 10.98
Internet Services....................... 0
Groceries etc. ......................... 400
Clothing................................ 0
Petrol/diesel........................... 200
Road tax................................ 5
Car Insurance........................... 130
Car maintenance (including MOT)......... 15.85
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 400
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 196
Buildings insurance..................... 22.65
Contents insurance...................... 51.06
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 3213.5


Assets
Cash.................................... 0
House value (Gross)..................... 260000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 260000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 192000...(720)......1.74
Hire Purchase (HP) debt ...... 17850....(326.5)....0<
Motorbike......................8500.....(141)......0<
Car 2..........................6500.....(176.6)....0
Total secured & HP debts...... 224850....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................2543.43...60........0
Tesco..........................2114.16...60........0
Santander......................1892.89...30........0
Furniture......................3000......94.87.....0
Overdraft Husband..............1500......0.........0
Overdraft Mine.................2000......0.........0
Tesco Loan.....................12854.....282.2.....11.9
Tesco Loan.....................22893.....418.9.....11.9

Mimi_Arc_en_ciel

Take a breathe Xmas-angel, grab a coffee and take a moment

That was the start of your journey. Congratulations ��


Let's have a look at this SOA

xmas_angel wrote: »

Evening,

I've never posted before but have been reading the posts from people all seeking advice and guidance and I'm hoping that you can help guide me in the right direction.

So we purchased our own home 2 years ago and since then our debts have spiralled. We've always lived in army accommodation so paying low rent and having a fair amount of disposable income to do what we wanted with each month, including purchasing new cars, mtorbikes etc because we didn't have a mortgage, I always reasoned that they were my mortgage payment. Then we purchased our own home, I'm afraid to admit we went mad, decorating and doing the house up and running up unsecured debts on our credit cards that we then paid off with our loans. Since then on top of the mortgage payment and loan payments we were then using our credit cards for everyday living. I feel like everything has spiralled, we both earn good money but have been stupid with our money and are now regretting decisions we made. Both cars and bike are on PCP deals so can't be sold, my pet insurance is high due to having 2 st bernards who I adore and could not stand to rehome but if I didn't have the insurance any bills would cripple us. I've cut everything out that I can, is there a debt I should be concentrating on paying off first? Where would you start to tackle this? I've posted our statement of affairs as well, any guidance would be greatfully received.
Thank you in advance!

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 0

Monthly Income Details
Monthly income after tax................ 1828.96
Partners monthly income after tax....... 2631.96
Benefits................................ 137.6
Other income............................ 0
Total monthly income.................... 4598.52

Monthly Expense Details
Mortgage................................ 720
Secured/HP loan repayments.............. 644.09
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 124
Electricity............................. 83 this is high, does it include a debt?
Gas..................................... 0
Oil..................................... 50
Water rates............................. 54.54 again, seems high
Telephone (land line)................... 47.2 can you get a better deal?
Mobile phone............................ 47 when does our interact end? Can you PAYG?
TV Licence.............................. 12.12
Satellite/Cable TV...................... 10.98
Internet Services....................... 0
Groceries etc. ......................... 400 this can be reduced.
Meal plan, down shift products, go to another supermarket. Look on the old style board for grocery help
Clothing................................ 0
Petrol/diesel........................... 200
Road tax................................ 5
Car Insurance........................... 130 can you get a better deal?
Car maintenance (including MOT)......... 15.85
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 400
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 196 ouch!! I know you love them though have you shopped around for pet insurance?
Buildings insurance..................... 22.65
Contents insurance...................... 51.06 are you covered for the right amount? Have you over estimated?
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0 nothing?
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 3213.5


Assets
Cash.................................... 0
House value (Gross)..................... 260000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 260000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 192000...(720)......1.74
Hire Purchase (HP) debt ...... 17850....(326.5)....0<
Motorbike......................8500.....(141)......0<
Car 2..........................6500.....(176.6)....0
Total secured & HP debts...... 224850....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................2543.43...60........0
Tesco..........................2114.16...60........0
Santander......................1892.89...30........0
Furniture......................3000......94.87.....0
Overdraft Husband..............1500......0.........0
Overdraft Mine.................2000......0.........0
Tesco Loan.....................12854.....282.2.....11.9
Tesco Loan.....................22893.....418.9.....11.9

I'm not great with loans - I've never had one so hopefully someone more knowledgeable will Bob along

With regards to your cars, have you stopped using them? Are all of your cards 0%? If not what are the Apr's? Which ever debt is 'costing' the most, I would concentrate on paying that one off and pay the minimum amount on the others.

Fosterdog

xmas_angel wrote: »

Evening,

I've never posted before but have been reading the posts from people all seeking advice and guidance and I'm hoping that you can help guide me in the right direction.

So we purchased our own home 2 years ago and since then our debts have spiralled. We've always lived in army accommodation so paying low rent and having a fair amount of disposable income to do what we wanted with each month, including purchasing new cars, mtorbikes etc because we didn't have a mortgage, I always reasoned that they were my mortgage payment. Then we purchased our own home, I'm afraid to admit we went mad, decorating and doing the house up and running up unsecured debts on our credit cards that we then paid off with our loans. Since then on top of the mortgage payment and loan payments we were then using our credit cards for everyday living. I feel like everything has spiralled, we both earn good money but have been stupid with our money and are now regretting decisions we made. Both cars and bike are on PCP deals so can't be sold, my pet insurance is high due to having 2 st bernards who I adore and could not stand to rehome but if I didn't have the insurance any bills would cripple us. I've cut everything out that I can, is there a debt I should be concentrating on paying off first? Where would you start to tackle this? I've posted our statement of affairs as well, any guidance would be greatfully received.
Thank you in advance!

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 0

Monthly Income Details
Monthly income after tax................ 1828.96
Partners monthly income after tax....... 2631.96
Benefits................................ 137.6
Other income............................ 0
Total monthly income.................... 4598.52

Monthly Expense Details
Mortgage................................ 720
Secured/HP loan repayments.............. 644.09
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 124
Electricity............................. 83 This is high considering you also have £50 on oil
Gas..................................... 0
Oil..................................... 50 This seems high but I know prices vary vastly depending on where you live
Water rates............................. 54.54 way too high, if on a metre cut your usage, if not consider changing to one.
Telephone (land line)................... 47.2 very high even if this is also broadband
Mobile phone............................ 47 how many us this for? Seems high, go to sim only as soon as you can
TV Licence.............................. 12.12
Satellite/Cable TV...................... 10.98
Internet Services....................... 0
Groceries etc. ......................... 400 this can be cut down, visit the old style board for ideas
Clothing................................ 0
Petrol/diesel........................... 200
Road tax................................ 5
Car Insurance........................... 130
Car maintenance (including MOT)......... 15.85
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 400
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 196
Buildings insurance..................... 22.65 This combines with contents is rediculusly high, mine is only £130 a year for both with plenty of coverage
Contents insurance...................... 51.06
Life assurance ......................... 0 you really need to consider this to pay off the mortgage and provide for the children if anything should happen
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0 no presents ever?
Haircuts................................ 0 never?
Entertainment........................... 0 nothing even with two children?
Holiday................................. 0
Emergency fund.......................... 0 as a home owner you need one
Total monthly expenses.................. 3213.5


Assets
Cash.................................... 0
House value (Gross)..................... 260000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 260000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 192000...(720)......1.74
Hire Purchase (HP) debt ...... 17850....(326.5)....0<
Motorbike......................8500.....(141)......0<
Car 2..........................6500.....(176.6)....0
Total secured & HP debts...... 224850....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................2543.43...60........0
Tesco..........................2114.16...60........0
Santander......................1892.89...30........0
Furniture......................3000......94.87.....0
Overdraft Husband..............1500......0.........0
Overdraft Mine.................2000......0.........0
Tesco Loan.....................12854.....282.2.....11.9
Tesco Loan.....................22893.....418.9.....11.9
when do your 0% deals end and what will they be when they do?

Well done for looking for help, getting it all written down is the first step. I've added comments in red.

I have worked out that you should have £439 left over each month after everything on your SOA is paid, as you haven't listed any cash I'm guessing you don't have that? Your next step is a spending diary for a minimum of a week, preferably at least a month listing every penny spent to see where this vast amount is disappearing. That includes the bar of chocolate when you get petrol, the extra sweets for the kids.

xmas_angel

Thank you so much for your replies!

In answer to some of your questions:

Electricity, just had this renewed onto a 1 year fixed deal and that was the lowest I could get it. I am in credit with the electric company and am leaving it for 6 months and then reclaim a refund of the credit to pay off the credit cards. Having a smart meter installed on the 30th as well.

Oil, this goes to a 'tank account' which I can also use for my boiler service each year. 500 litres lasts around 6 months and last cost me £142

Contents insurance is high because it includes husbands kit insurance. It's an irritation of mine as well but unfortunately they have to have it.

Will look into the water meter, never considered that before!

Car insurance has just renewed and we had a claim last year so expected it to go up, that amount is for the 2 cars and motorbike though.

Pet insurance, one of the girls cost £46 to insure (much better) my older one £147 a month, due to her being diagnosed with mild hip dysplasia I cannot move insurance company but if she needed a hip replacement that's £7.5k per hip! Me and my husband have learnt out lesson though, our next pet will be a chihuahua 😂

I'm feeling a bit more positive about it all. We've decided to go on a cash only budget so we don't overspend and then use credit cards to top us up. Cash left over will go on paying off the credit cards first. And writing a spending diary sounds like a really good idea as well so we both know where our money is going!!

Thank you for responding!
Claire

xmas_angel

I meant we'll go on a cash only budget so we don't use the credit cards anymore not that we'll use them to top us up! After reading it I realised it didn't sound right!!

worriedDan

Well done for posting - This is the hardest step. You have faced up to your debts and want to do something about it which is great.

The good news is that your income still exceeds your outgoing, as is often not the case on here. We started off in a very similar situation to you with debts touching 60K on a similar salary to yours. I can remember all too well the stomach churning feeling when you finally add it all up. 6 months down the line and we are reducing the debts and feeling much better about it all.

How long do you have left on your 0% promotional rates? You can definitely make some savings with your groceries. We are a family of 3 and we generally spend £200 per month. We do shop at Aldi/Lidl but we also eat really well and cook from scratch.

Well done for taking this first step.

tealady

Hi
If your husbabd has to have kit insurance yave you checked to see if you can claim tax back on the payment? I know if people have to wear a uniform and have to clean it themselves they can claim.
HTH

Fosterdog

With the kit insurance what is the insured value? Have you considered getting separate kit insurance and then combined buildings and contents?

I've just run a quick quote with one of the kit insurance companies.
First time I used £5500 of kit, £500 personal possessions, £25500 contents, and £500 for mobile phones and it came out at £33.90 a month (I did use a random postcode so it won't account for where you live)

I ran a second quote upping the kit cover to £10000 and dropped the rest to £0 and it's only £22.12 a month.

I genuinely have no idea what level of cover is required for kit so I may be way off the mark with my figures but if I'm even close you could save a fair chunk each year especially if you shop around for a better combined building and contents, your building cover alone is higher that most we see on here.

Beetroot24

I'd look into all of your insurance policies and figure out if it's worth it, or false economy to scrimp on your kit insurance. When my husband was in the Army, the kit insurance he had paid back £800 for a 4 year old (out of date) TV and PS3, that the kids managed to knock over. I think the excess was £50. When I'd been burgled whilst living with my mum a couple of years before, I can't remember how much her excess was, but her home insurance would only pay up £200 for my laptop that I'd bought 11 months before for £600. Insurance always feels like a waste of money until you need it.

xmas_angel

I will have a look into the kit cover and see exactly what we're covered for and see if I can cut it back a bit. I guess again, we've always been a bit naive where prices are concerned as we never had to worry about them, oh to be in that situation again. But you're all right, this should have been something we kept under control and looked into more. The biggest battle has been getting the husband on board, as while I was very aware the debt was rising he would still spend and I'd be moving money from my account to cover his bills that came out of his account. I'd then be left short and putting diesel and food on my credit card 🙄 Onwards and upwards as they say, I got paid today, I have my budget for the month, i will take out what we have available to spend on food, diesel and then leave my account well alone for the month. Keeping fingers crossed we can accumulate some cash left over to pay off a lump sum on one of the credit cards to reduce that a bit 🤞

Mnd

Your land line is extremely high, we pay £20 for land line broadband and bt sports
Also how many phones are covered by the £40. We pay half that for 2 phones