Working Hard Debt Diary - Here goes

WorkingHardDFW

Afternoon all DFW’s.

I’ve been lurking around the boards for a long time now and using Martin’s advice on virtually every aspect of life that involves money. That doesn’t mean that we’re not in difficulties so I’ve decided to bite the bullet and start my debt diary. From reading other diaries I can see what a great source of help and support you all are and therefore as the hard work really starts here goes:

This is the really hard part, writing it down:

Income: £4238 pm
Outgoings: £4302 pm £64 short at present but this is being covered by Ebay sales and extra’s
Debt: £50,000 plus mortgage (Ouch…………….):eek: :eek: :eek:

SOA – Deep breath here goes

Water £48
Mortgage Nationwide £975 Fixed rate until 2009
BT£42 Voice and broadband too expensive but had a nasty experience with Talk Talk last tear. Looking to combine with sky
Home Ins & Pet Ins £25
Charity £4
Cash to own accounts £100
Christmas Fund £65
Holiday Fund £267
Budget £442 Childcare, kids act costs, birthdays, clothes, window cleaning etc
Food £300 Just reduced from £400 (Family of 5)
Council Tax £194
TV Licence £11
Professional memberships £9
Club Membership £5
Car Costs £200 Tax, Ins, Servicing Petrol is covered by expenses and is not included
Scott Power (Gas & Elec) £95 Just switched to Utilita
Life Insurance £20
Car Loan £467
Sky £37
Consolidation loan £287
Contact lenses £13 Looking at sourcing these directly
Bank Charges £12 Can’t lose until the OD is paid
Bank interest £46
B Gas Service £16
Barclaycard £87
Spurs Card £14 All CC’s have been shuffled and moved to get the best LOB rate or 0% for a fixed period
IF Card £197
RBS Card £138
Halifax Visa £186

How did this happen? The usual tale overspending, incorrect budgeting, living a lifestyle we couldn’t afford without any planning and circumstances not making us face up to the situation. We’d been canny and were cutting costs but not even my OH’s spell out of work for a few months some years ago brought on a Light bulb moment. It was only about 4 months ago when the LBM came when we were refused a credit card (don’t blame them) and since then we’ve really been working hard to pull ourselves out of the mire.

We are lucky that we have a good income, just as well, and my OH does get regular and sizeable bonuses but these have been frittered away in past years. I do feel that we’ve got a handle on things now and we are in control. I work pt and therefore have the ability to earn extra income once my youngest starts school next year. Meanwhile I’m ebay’ing anything in the house that isn’t tied down and throwing any lurking cash at the cards, clicking on the cashback sites plus planning using my own professional skills to start my own business.

The aim of my diary is for me to help me see my own progress and gain support from all you other DFW’s to keep going when it all gets too much

Thanks for reading.
All coments welcome.

peb

Hiya and welcome. All I can see really is a bit nit picking but every little helps:-

(1) you need to sort out phone/broadband asap - this is one of the things which is tipping you over the edge.

(2) What are the Club fees for?

(3) Can you breakdown your car expenses - they seem high to me (as they don not include petrol) and I drive a car which according to insurers is high on the list of wanted by the local thieves

(4) I know it is a small amount but a lot of folks on here will say that charity begins at home

(5) Again can you break down the £442 budget as it is high and there could be non priority things to hit.

(6) Holidays - aargh - is it booked, can it be cancelled and something a little cheaper found? When will you stop this payment? at this amount per annum you are looking at £3204 which you just cannot afford at this time. Ditto Christmas - do you really need to spend £780 per year on one day? Little ones will not know how much is spent and there are loads of threads on inexpensive presents.

It is a year until you can work more hours and that is a long time to get by with ebaying etc although it can be done - see our brilliant Hypno for inspiration.

Good luck and keep posting.

Chollita

Forget the holiday fund for now.

Could you live without your car?

Do you have glasses that you could wear instead of contact lenses?

Become JWs and refuse to celebrate Christmas LOL

And that old MS mantra ... get rid of Sky ... for less than the price of a month's subscription, you could get a digibox.

WorkingHardDFW

Thanks for your comments in response:

Phone/Broadband is high but we moved to Talk Talk last year and it was a nightmare. Since both I and OH work from home sometimes it caused us no end of grief which is why we switched to BT however I know we can reduce this so i'm onto this at the weekend.

Car expenses are high. We run two cars because of our work but I walk as much as possible when I can. Personally I think that I've overestimated the car costs: tax, insurance, servicing, tyres, breakdown but I don't want to reduce the amount put aside until the new year when i'll have a whole years costs and paid have both tax and insuranace which are due in Jan. I'm planning to review it all then. Unfortunately part of reason we got into debt was running cars based on expenses and not budgeting properly. We've now filtered the expenses income and petrol outgoings into a seperate account which should go some way to reducing the amount put aside for servicing etc. Hope that makes sense.

Charity - I know charity begins at home and it is a small amount but equally look after the pennies - fair comment

Budget Account this covers: Nursery costs, After school costs, playgroup, school milk, swimming lessons, childrens activities, holiday childcare, Guides/Cubs subs, Family birthdays, school trips, haircuts, clothes, school uniform, our childrens birthdays, window cleaning, birthday parties.

Again this is based on forecast against actual and should reduce next year since my youngest now gets pre school funding and I'm using childcare vouchers (one of Martin's rec's) but again until I've done a full year of costs I won't be certain. Again this comes down to our previously unbudgeted ways!

Club - this is my OH Cricket Club perhaps that should come out of his cash each month?

Holiday - My OH is particulary keen not to lose this since we (as everyone does) work very hard all year and that is our one time away as a family. That said we are looking at a cheaper option this year (no flights family of 5) so we should have a surplus which we can throw at the debts. Likewise with Christmas I was saving £120 per month !!! until studying the boards and reaslising that was ridiculous. The saving has been halved and I'm aiming through audicious spending to only spend half of what is in the account again to throw the surplus at the cc's however that budget does include the food spending. Its still a lot though.

Working Extra - Fair comment a year is a long time to be Ebaying alone. As I said I do have the option to market my professional services as a consultant and I am currrently getting myself organised to do that. I'm aiming to have that up and running the new year.

WorkingHardDFW

Another few days have gone past in a MSE madness.

We've just come through the 'pinch point' in the month and survived. This usual tight period was not helped by the gaining of a new family member - a puppy:D . Being purely MSE this was funded from some money left to me, our cat had recently been put down (I did want to pay it off the CC's but was outvoted by OH and the kids - the kids aren't aware of our tight finances) but it had made balancing the books difficult for a few days.

Added to this my DS broke his school shoes and they were too old and worn to take them back to the shop. So new shoes needed asap.

Additionally my OH noticed that his car tax had expired at the end of September and we'd not noticed and not received a reminder. I'm not sure why we didn't but I've left that one with him to speak to the DVLC.:eek:

One of my ebay parcels (china!!) arrived at its destination in pieces despite by best efforts wrapping it so I wasn't best pleased with the carrier.

Rounding off my week nicely my efforts at Cashback sites which upto now I'v e not really done too much before were clocking up the cash then my GreasyPalm account seems to have disappeared and any attempt to have my loggin details emailed to me fail............... :huh:

All in all not too good a few days but thats life as a DFW I guess

WorkingHardDFW

Feeling a little better I've just posted another 12 items on ebay which will all go towards paying off the CC's. It feels like any thing that is not nailed down is ebayed at present. Plus side is that it is clearing the house of a lot of unwanted and unecessary clutter.

I feel slightly better now that has been done. :j

Tomorrow is a new day!!

pandapaws

Hiya!

Well done on putting everything down in a list - I reckon that once you get that bit done, you're half way there!

The comments about holidays, Xmas etc are fair, but I also agree with you that if you're working hard then you do deserve to benefit from it a bit. I would say that your main priority is to balance the books - at the moment you're £60 short - how about taking £20 out of the Xmas savings and £40 out the holiday fund - obviously a little less if you can cut any of your other costs like the phones, charities etc. That will still leave a VERY healthy balance in both the savings accounts, but you won't be in the red every month and any extras you make on Ebay/self-empoyment can be treated either as extra spending or extra debt-payment.

You didn't list your actual debts, amounts, interest rates etc - that might help a bit (you I mean!) as it gives you something to concentrate on and work towards.

Oh, GreasyPalm is a load of poo in my opinion! Concentrate all your efforts on Quidco, TopCashback, and a new 100% one just started that seems ok, clickcashback.

Also, have you looked at matched betting? Something that if you're reasonably good with numbers can be done from home, so long as you're not likely to be tempted to gamble instead of just bet matching!

That's about all of my tuppence worth for now - good luck with it and keep posting, it's amazing how keeping a diary has helped me!

millionaire_in_training

Good for you. Even throwing small bits and pieces at the debts make a huge difference. First time I did the budget I was well over. I am much better now. I have enough to live on and some left if I need it for kids things or throwing at the debts. I am a single mum with 2 kids and have managed to reduce my debt by loads since the summer. My kids were watching Spendaholics on the telly tonight and my youngest said' mum are you a spendaholic?' My eldest just laughed and said 'no way not these days'. It's best the kids are brought on board as much as possible as mine accept me saying no mostly without a murmer. So long as they are fed and DS gets his Beano then all is well. Good luck x

Squirrel29

I love your post Millionaire in Training.. although we feel we should protect our children from our problems at the end of the day getting out of debt will benefit the family long term. If it means a couple of tight years without holidays or cutting back of activities for the children it must be done.

What I guess I am trying to say is don't shield them from it.. my DS often gets into a strop if he can't have latest Xbox game or I wont' give him a sub on pocket money etc but I am trying really hard to make him realise that my debts cause me so much stress and I am beholden to the whim of credit card companies when they fancy an interest rate hike. I don't want him to have that lifestyle, I want him to save for things he wants and have disposable income.

WorkingHardDFW

Thanks for all your comments. These boards are so helpful both in terms of tips and tricks to make cash go further and for keeping the morale going when it all gets too much.

This week I've rejigged the finances to make the books balance at the end of the month. Both our holiday funds and christmas funds are reduced to allow for this balance. Hopefully a full year of MSE ways will mean that we are well under budget for next year. We are trying to be so prudent with our Christmas shopping this year that we come in well under budget so we can throw the surplus at the CC's.

My aim for this weekend is to seek out a better option of phone/broadband. As I have already said in my earlier post we did go to Talk Talk last year but it was so awful we pulled the plug on it after only a few months. My OH is reluctant to lose Sky (I'm not!!) so I'm going to look at the SKy option for an all in one package. Any thoughts?

I was a bit fed up last night when five of my ebay items didn't sell. However on checking tonight I've got bids on six items which is great. It always amazes me the items that do and don't sell. Things that I think are decent don't sell and some of the clutter goes for a song which is great. I enjoy selling stuff on Ebay far more than buying now!!

Thanks for your tips of GreasyPalm PandaPaws. I'll give them a swere I think though frustratingly I had about £10 clocked up which I will chase. Since I've got two lots of car insurances due next month I'll stick with quidco.

I appreciate your comments millionaire in training about setting a good example for the kids. Its hard to strike the right balance with them appreciating the value of things and earning the right to buy something against the want to have it now. We've not really factored in pocket money for DS & DD, its certianly not in my budget forecast, but I think i'll budget for it next year.

hypno06

Hi there!!

Have you put the figures into the snowball calculator on www.whatsthecost.com ? It will give you an initial debt free date and will then be something you can play around with to get that date ever closer!

Good luck. You are in a pretty good position to start with, with not too much of a deficit, but if you want to hammer down those debts, they will tumble with a little effort!