Financial Help/Advice

Dorbs

I'm not very good with money. I acknowledge that, it's my biggest mistake in life, and i'm now trying to rectify it at the age of 33.

If possible i'd like some guidance/advice on what to do, based on some information I can provide. My current debt is -

1 year of payments @ £197 a month left on my Audi, personal finance.
1 Credit Card (MBNA) with £6000 on it.
1 Credit Card (Virgin) with £5500 on it.

Both credit cards are 0% balance transfers so paying minimal interest on them until late 2018 I believe.

I've currently built up around 3,000 in savings which should increase to 4,000 next month, and i've no idea what I should focus on. Do I pay off the last year of my Audi and get that out the way so I have an additional 200 a month towards other things? Should I work on clearing one of the credit cards first?

If it helps, my basic take home is usually between 2300-2500 a month, plus 500 a month rent from my partner, so my current income is more like 2500-3000 a month. I'm also renting rather than a mortgage currently, but would like to get into a position where i can clear some of the debt down to single digits at least before I even think about saving for my own home.

Please help, i'm useless at this!

DCFC79

Why not post up an soa

Dorbs

What's an soa?

StopIt

A statement of affairs: http://www.stoozing.com/calculator/soa.php


Click Format for MSE at the bottom.


If the car is costing you interest and the interest is more than your savings, yes, it'll be better to pay that off.


Otherwise, £11,000 of CC debt on a £30,000+ annual salary is not an insurmountable debt.


Post that SOA and people can help you find ways to deal with it.

Dorbs

Statement of Affairs and Personal Balance Sheet

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

Monthly Income Details
Monthly income after tax................ 2300
Partners monthly income after tax....... 500
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2800

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 197
Rent.................................... 600
Management charge (leasehold property).. 0
Council tax............................. 140
Electricity............................. 66
Gas..................................... 0
Oil..................................... 0
Water rates............................. 24
Telephone (land line)................... 48
Mobile phone............................ 0
TV Licence.............................. 11
Satellite/Cable TV...................... 45
Internet Services....................... 0
Groceries etc. ......................... 200
Clothing................................ 30
Petrol/diesel........................... 50
Road tax................................ 11
Car Insurance........................... 22
Car maintenance (including MOT)......... 40
Car parking............................. 10
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 10
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 5
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1519


Assets
Cash.................................... 3500
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 4000
Other assets............................ 0
Total Assets............................ 7500


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0
Hire Purchase (HP) debt ...... 1700.....(197)......0
Total secured & HP debts...... 1700......-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Credit Card 1..................6700......70........21.07
Credit Card 2..................5500......80........19.09
Total unsecured debts..........12200.....150.......-


Monthly Budget Summary
Total monthly income.................... 2,800
Expenses (including HP & secured debts). 1,519
Available for debt repayments........... 1,281
Monthly UNsecured debt repayments....... 150
Amount left after debt repayments....... 1,131

Personal Balance Sheet Summary
Total assets (things you own)........... 7,500
Total HP & Secured debt................. -1,700
Total Unsecured debt.................... -12,200
Net Assets.............................. -6,400

Dorbs

I'm not sure if i've got any of that wrong. I tend to buy maybe some jeans, a jumper or something once a month so maybe 30-40 a month on clothes. Birthdays is usually about 20 per person.

Unimaginativeusername

I wish I earned that much! Any jobs going at your place?

DCFC79

Dorbs wrote: »

I'm not sure if i've got any of that wrong. I tend to buy maybe some jeans, a jumper or something once a month so maybe 30-40 a month on clothes. Birthdays is usually about 20 per person.

Do you find you have over £1k left each month ?

See if it were me Id ditch the Audi and get something economical if it ismt already. My tax for me is £20 a yearĺ.

Dobbibill

Do you definitely not spend anything on 'entertainment'. Not even an occasional drink, alcoholic or coffee?

What are your credit limits on the cards? Would you have room to BT any of the balance when your deals end on the credit cards? Moving balance A to card B and vice versa giving you a little longer at zero %.

sm_1988

Out of curiosity why does your partner give you £500 if your rent is only £600?

MrsSave

If your soa was accurate, you wouldn't have the debt you currently have. I'm guessing it's a 'where you'd like to be' soa. If that's the case my opinion is that it should be more realistic. Entertainment shows nothing with you? I can't see that working. Birthday/Christmas at £10 a month - I'm not sure that's correct (you may prove me wrong). For £120 a year you buy your partner's birthday/Christmas gifts, night out/takeaway/cake/any extras to celebrate and then add on top of that any other birthday and Christmas gifts you buy for?

If your partner gives you £500 towards the rent, does she contribute by paying for any other bits as well? You have groceries at £200, does she also buy more on top? There are a few other minor tweaks that could be made, but these are the big things that stand out for me.

Keep a spending diary, and look back over your bank and credit card statements to work out exactly what you've been spending. Then you need to work out a realistic budget to move forwards and to start tackling your debts.