HElP!!! where do i start

tlc678910

Hi,
Assuming your partner has a day job and is home over night could you try a night job?

I work 10pm - 7am on 3 nights a week (with adults with learning disabilities) and earn over a grand a month. You could also look into elderly care, children's residential, supporting autism.

It is tiring but you can do the school run (if there is a breakfast club that is a bonus and you probably need an after school club to get a decent sleep) My sons club is less than £4 for breakfast and £6 for after school until 6pm so well worth it. You would only need childcare on the day after your working night obviously and some of those days would be weekend.

If your partner does shift work he could collect the kids when on earlier shift and take them to school if on a later pattern.

If you can make it work it can be quite family friendly as if my son is ill he can be off school no problem as I am home in the day.

Tlc

magic_fairies

hi all

thank you so much for all your time and effort to reply. I am definitely going to take all that advice and put a new life plan together.

sometimes you cant see the woods for the trees.

mumtoomany

Hi magic, just to offer my advice. Your benefits seem low for such a low wage and 3 children, have you checked they are correct? Also I think you could get some help with council tax. Spread your council tax over 12 months rather than 10 for the coming year (if you are not doing so now), makes budgeting a bit easier.

Water seems high, are you on a meter? If not look into getting one.

You must prioritize your mortgage, forget all other unsecured bills for now. Write to them and explain your situation.

Look at ways to save on groceries, yellow sticker shopping, Mortgagefreeinthree blog, A girl called jack blog. Check out the old style threads on frugal eating/shopping.

Good luck with all this, I hope your income goes up soon, M2m.

ohdearhowdidthathappen

Is your mortgage only £5500 or is that just the arrears? Have they agreed to the £100 a month?
I definitely wouldn't consolidate, you're better off just paying it back unsecured, even if it takes longer.
Between you, there's definitely scope to earn much more... my main job I only work 2 days a week as anything over that is counterproductive in childcare costs. I then work in a shop on a Saturday and childmind 10 hours a week too. You could look at evening and weekend work?

getmore4less

where do i start?

Day one you have made a start.

The key to progress from here is finding out where it all goes.

magic_fairies wrote: »

hi all

thank you so much for all your time and effort to reply. I am definitely going to take all that advice and put a new life plan together.

sometimes you cant see the woods for the trees.

Part of the problem is these problems are caused by multiple issues and need to be tackled from multiple angles, the consolidation always looks like an easy solution but hardly ever works without sorting out what causes the issues in the first place.

At the highest(easy) level you break it down into

Earn more.
Spend less.
cheaper debt

Earn more.

Sort of obvious but sometimes needs a bit more clarity.

Review your benefits make sure you are getting everything you are entitled too.
(can't help with that)
Taking the above into account look at all members of the household for earning potential.
How old is the oldest, round our way the local Wetherspoons takes on 17yo to do the cleaning up collecting glasses a food deliveries.
As others have said if you chosen hours are hard to find look for alternatives, might not be ideal but can get you back on track.
it might be that one of you needs to up their hours may be better than trying to both get jobs compatible with child duties.


This reorg takes time but once something gets sorted the benefits are decent.


Spend Less

This often is the tough one to deal with as the problem looks massive but it can be broken down into small pieces to be tackled individually.

one advantage here is there are some instant changes others that you may not have seen and some that will take some time.

The first thing that needs to happen is a spending diary, this is to track every penny that goes out, EVERY penny.

From this you build up the picture needed to fine tune the SOA and start to prioritize much more.

Part of this is cash preservation think think think before you spend anything.
even delaying things you really need can help.

Along side thinking carefully about every spend is a review of all the bills.

These often take up a big chunk of money,
The first thing is go through every contract and check the end dates.
who are your internet/phone/tv providers?

Then for every bill go through and check if there is any scope to change any contract to a cheaper one while in the contract period.
Look for cheaper options or can it be eliminated completely.

Some things you can only pick away at like the gas and electric, you won't get them to Zero but might be able to knock a bit off.

Others you can put on hold like clothing, it is a case of make do with what you have and charity shops for anything desperately needed(except underwear and possibly shoes).

I think you really have to review your Jan-March present spends you don't have the cash for those this year.

Car expenses are high over 30% of your income not sustainable.
even long term with more income this needs a drastic review might as well try to get it down now.

Cheaper debt

This is an area that needs clarifying where you are.
The mortgage details need to be complete.
What are the details of the mortgage, amount, rate, term, normal payment.
Arrears amount and payment are they agreed or just what you have decided to pay
How long to build up the arrears?

Are the car loans secured on the cars(eg HP) or just regular loans?

until the full proper picture is known it is difficult to say what is best here.
The typical scenario is prioritize the mortgage and reduce the others, if necessary down to token payments and a DMP.

I would also get all your credit reports to see where they are missed/late/defaults etc.

---

One note regarding contracts,

If you sign up for a contract the reality it is just like a debt you are promising future money will be going to pay the contract.

In some cases it is worth that commitment if the savings are good but it is better to have the money available, rather than be reliant on future income.
For some things like a utility you have to pay them anyway so if a contract can save a bit worth doing.
For the discretionary items like TV and mobiles these need vary careful consideration.

Phones making do with a PAYG and cutting back on use can save loads.

TV look at alternatives to long contracts with the likes of VM/Sky, freeview/sat and monthly subscription like NowTV, netflicks that can be got cheap on deals and turn on/off at will can be just as good and offer more flexibility with costs.

---

Another reminder break the problem down and deal with each bit as best you can.

Don't forget the spending diary.
Can you construct one that goes back to Jan 1st that will give you a head start on finding out where all the money goes.

While on child duties and looking for a job set aside some time every day to do the spend diary and look at all your spends, maybe try to pick one a day to look at in detail and see if there is something you can do to get it down.

MarmaladeMamma

Hi magic faeries, I can't offer any financial advice but wanted to chip in - you are right to be wary of extra work (don't jump on me MSE-ers!!) As a mother on benefits to supplement my part time job (only 10 hours, one night shift) I know all too well there is a sweet spot with working and benefits. This may be controversial but for me anyway if I work too much and put the kids into childcare, it is literally pointless and I could even be out of pocket. Maybe you could try and find a sweet spot for yourself, probably under 16 hours as to not be disqualified from the help you get? I do night shifts so I can be around for the kids and it's easier to find minders for one night a week as opposed to working around a school run. Good luck with your situation, like they've all said above that mortgage is number one, you will find a way somehow. And if you're thinking of cancelling contracts with cable and suchlike beware of charges for doing so- my experience tell me they don't like letting you go without a fight £££. All the best to your family, I hope the little extra your hubs will bring in can start chipping away at it all. Also with your low income would you not qualify for a DRO for the credit debt? Don't think that has been mentioned already or maybe you already know?

EssexHebridean

Usual, responses in red.

magic_fairies wrote: »

okay so this is my SOA. next month feb 26th my partners income goes up to £1000 should I update that SOA now or next month Next month - your SOA should always reflect how things are right now.

I had an idea of possibly getting a secured loan on the house to cover all debts. then in 6 months once credit rating improved, then to remortgage releasing equity to pay off the secured loan. which means a clean slate mortgage and normal bills . No. No no no no no no NO. is this a stupid idea? Yes. You're considering taking debt that is currently unsecured, and that you're struggling to afford, and securing it against the roof over you & your family's head.I'd not go as far as "stupid" but certainly ill--advised. PLEASE under no circumstances do this in your situation.

Household Information
Number of adults in household........... 2
Number of children in household......... 3
Number of cars owned.................... 2 Allowing for the low income do you need two cars? And I mean actually "need" - not want.


Monthly income after tax............. ... 0 How can you increase this - take on some sort of work from home? Evening work when your partner can look after the children? Do Surveys online? Anything at all in here will help.
Partners monthly income after tax....... 491
Benefits...........................… .. 920 You've checked this and it's accurate? How will it change when your partner's income increases?
Other income......................... ... 0
Total monthly income............. ....... 1411

Monthly Expense Details
Mortgage................. .........… ... 100 (whilst were in a mess) How much is the full payment? Are the mortgage co fully on board with the reduced payments?
Secured/HP loan repayments...… ...… .. 0
Rent............................. ....... 0
Management charge (leasehold property).. 0
Council tax............................. 130
Electricity............................. 60 This and the gas look high to me. Read Martin's guide on the main site to saving energy, and also check you are on th best deal.
Gas..................................... 60
Water rates......................... .... 70 Ouch - are you in the South West? Check to see if metered may be cheaper for you. If this IS metered, use less.
Telephone (land line).........… ....... 0
Mobile phone......................... ... 38 (mine and my sons. sim only) Shop around - you can get a lot cheaper than this.
TV Licence............................. . 12.5
Satellite/Cable TV...................... 40 (in contract) When does the contract expire? This needs to go ASAP.
Internet Services...................... . 29 (in contract) Trim to a more basic package (or use mobile data if you have it on your phones) as soon as you can
Groceries etc. ......................... 250 You can trim this - check out the Old Style board on here for some great ideas. Always meal plan, make a shopping list and stick to that list.
Clothing............................. ... 50 You & the partner need to drop to essentials only (knickers and socks, basically) and the kids stuff can come second hand as far as possible.
Petrol/diesel........................... 180 :eek::eek: OK we spend this in a month and have a 40 mile round trip commute on work days - I really hope this is an error because to put into perspective you're currently spending more than a third of what your partner is earning on petrol - that's not sustainable.
Road tax................................ 30
Car Insurance........................... 82 Again this is too high a proportion of the income you have coming in
Car maintenance (including MOT)......... 6.6 Your SOA says no cash assets so where are you saving this money if you're putting it aside every month? Also for 2 cars it is a LONG way short. We have 2 small cars, both diesel, and budget £160 a month for all running costs aside from diesel - even allowing for you paying insurance and tax monthly, you need to be looking at a lot more than this each month to cover all other running costs.
Car parking............................. 25.6 Park further away and walk, put bluntly - you don't have this spare.
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 80 What's this for? Can it be dropped?
Medical (prescriptions, dentist etc).... 0 Never? Nothing at all?
Pet insurance/vet bills................. 0
Buildings insurance....... .............. 28
Contents insurance...................... 22 This is high - use comparisons sites and consider ditching your current policy mid year if it makes financial sense to do so.
Life assurance ......................... 25
Other insurance......................... 0
Presents (birthday, christmas etc).. .... 100 (only jan feb n march.. all birthdays done then) Yes but you need to budget over a year - and what about Christmas?
Haircuts................................ 30
Entertainment........................... 0 (we haven't done anything for months) Not a coffee out here, the odd magazine or a comic for the kids, an ice cream on a hot summer day? Think about the small stuff and see if this is really accurate
Holiday................................. 0 ( I wish)
Emergency fund.......................... 0 (from where) You're a homeowner, you HAVE to start thinking about building something here.
Total monthly expenses................. . 1448.7

Assets
Cash.................................... 0
House value (Gross)..................... 130000
Shares and bonds........................ 0
Car(s).................................. 5000 (both financed.) Oh dear...
Other assets............................ 0
Total Assets............................ 135000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 5500.....(100)......0
Total secured & HP debts...... 5500......-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
credit cards...................3900......130.......0
car loans......................4200......180.......0 Get rid of one car and pay a great big lump off here - it will also free up a chunk of income monthly for other things
personal loan..................1000......183.......0
family loan....................2000......0.........0
Total unsecured debts..........11100.....493.......-

Monthly Budget Summary
Total monthly income.................... 1,411
Expenses (including HP & secured debts). 1,448.7
Available for debt repayments........... -37.7
Monthly UNsecured debt repayments....... 493
Amount short for making debt repayments. -530.7 so even with partners increased income you will still be in deficit here.

Personal Balance Sheet Summary
Total assets (things you own)........... 135,000
Total HP & Secured debt................. -5,500
Total Unsecured debt.................... -11,10
Net Assets.............................. 118,400

Ouchy. That's not pretty reading I'm afraid. Allowing for the upcoming income increase though I think you're in a position that is probably just salvageable, but you do need to realise that things are extremely tight, and you're only a whisker away from them getting beyond that, currently. It's a sound warning from MarmaladeMamma about the benefits -v- earnings but that's something to research - I know an Avon round used to fit nicely into the category of "things you can do" for example and it sounds like 16 hours is still the magic number here. Find out what your options are.

Any of the children over 13 need to ensure that they have Saturday/weekend jobs to take account of their own clothing (bar basics like school uniform, perhaps) and haircuts. Any prospect of moving the youngest child to nearer the school the middle one will be going to when they move up? That would make life easier on their "school commute" perhaps.

Work through things rationally, but make firm decisions where you need to cut back on stuff - until your situation turns around substantially you do have to cut things to the bone I'm afraid. Good luck and do keep us informed as to how you're going!