SOA, help please!

stinabean

Hiya

So we're definitely spending more than we earn as we're both constantly, more me than the OH, in our overdrafts.

Basic SOA below. Have not included things like clothes, prescriptions etc as these just don't currently happen. We also don't save up for the MOT etc and we have to scrabble for the money when it comes around - obviously I'd love to change this but need to crush some of this debt first.

My salary - £1,262, will change to 1,350 in Jan 2020
Partners salary - £1,250
Benefits - £80
Total - £2,592

Monthly Outgoings:

Mortgage/Rent - £574.82
Council Tax - £125
Water - £24
Gas - £20
Electric - £40
TV License - £12.88
Phone - £29 (this is both contracts)
Food - £300 (this is approx what we spend, willpower needed to shrink it down)
Petrol - £40
Life Insurance £27.95
Home Insurance - £22
Car tax - £17.06
Car insurance - £35.51
Car - £219.87
Virgin - £78.87 – contract ends Aug and can't wait
Netflix - £9.99
Spotify - £10
PSN - £6.99
Vets - £14
Childcare - £735 (this varies, so have gone with the most expensive month)

Total: £2,342.94

Debts
Boiler – 83.33 till dec 2019
Windows - £39.10 till 2022

= £122.43 out

= £2,465.37 total

Credit cards:
MBNA - £28 a month, owe £1,568.13 (me)
Halifax - £41 a month, owe £1633.98 (me)
Barclays - £29 a month, owe £1147.31 (me)

Barclays - £22 a month, owe £948.15 (OH)
Lloyds - £20 a month, owe £1,950 (OH)

= £140

Total outgoings - £2,605.37

So monthly we are short by an average, as childcare changes per month, of £13.37.

It doesn't seem much to be in the red, however I would love to have some "spare" money to throw at credit cards.

I know things like Spotify, PSN etc aren't needed. This is my OH and as he doesn't get to spend on himself, this is it for him.
Will be cancelling Virgin next month as the contract ends in Aug.
Can't downsize the car as we need a big car with a baby and a dog, all our family lives 4 hours away so large car to carry all our stuff.

Any tips? I'm also looking for a second job but is proving difficult.

Please be kind, and sorry for rambling.

[purplesignup][/purplesignup]

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Theamazingshrinkingwoman

Think you are missing a few things:
Birthdays
Christmas
Medical e.g. prescriptions
Dental
Haircuts
Entertainment - never have takeaways etc?

Willing2Learn

For your monthly childcare costs, I suggest adding up the total for the year and then dividing by 12. That way you will get a more realistic total.

Is your SOA correct? (Theamazingshrinkingwoman has already mentioned some categories that are missing). Your SOA indicates that you don't have enough monthly income to service your unsecured debts. Is that true? Or is your SOA not accurate?

Theamazingshrinkingwoman

Sorry, saw you said that you haven't included things that don't happen but Christmas and birthdays (especially when you have children!) always happen!

Candyapple

Both your salaries are very low - you and your partner need to look at finding better paid main jobs first and foremost otherwise you will continue to struggle for a long time.

Is is possible to find a cheaper area to live in / rent?

Have a look at the Old Style board for ideas on cutting food costs:
https://forums.moneysavingexpert.com/forumdisplay.php?f=33

Do you have anything you could sell? Old phone? Consoles? Clothes? Next time eBay have a promo on for £1 fees, list as much as you can and throw it towards your debts.

Why is your OH paying £7 monthly for PSN? This is the most expensive way to do it. Even if he bought a 1 year's subscription upfront which is as cheap as £24-£30, you would be saving £60 per year.

Is Spotify really necessary? Could your OH not make a sacrifice for at least a few months?

Can you downgrade Netflix to the basic package of £5.99?
https://www.netflix.com/signup/planform

Also, if you are only using Netflix, you don't need to pay for a TV licence.

KxMx

Due to the gaps in expenditure I'd suggest a spending diary, everytime you spend cash or cards it all gets recorded.

Often where we think money is going and where it is actually going are two different things!

After a few weeks or a month you can identify what is a priority for you to keep, and what can be reduced or cut entirely to have some money to throw at the debts.

The car seems like a big expenses and an area to save money in. I appreciate you feel you can't change it, but some families have to manage without a car at all so I'm sure you could find a way to adapt to something smaller and cheaper.

I know you said prescriptions just don't happen, but they are £9 per item now. Could you afford that if you suddenly needed several? Look at the yearly Pre Payment Card, for £2 per week per person all medicines will be covered. Can be worth paying for peace of mind even if it doesn't end up paying for itself. You can pay the £104 upfront or I believe or Direct Debit which is 10 fixed monthly payments.

bsms1147

If you've already decided that the PSN (PlayStationPlus?), Netflix and Spotify must stay;

Rather than paying £6.99 a month, any way that you can pay pay £13.99 for 3 months (saves £9.92 year) or £34.99 for 12 months (saves £48.89 for the year), as both are on a 30% off deal for the next few days. I appreciate it's an upfront cost, but it saves money in the longer term for something it sounds like you will be paying for anyway.

In the same vein, 12 months of Spotify paid upfront would save £20 a year. Again it's paying upfront which might be the dealbreaker.

Assuming that Neflix is the Premium tariff (that was the only one that was £9.99 a month) this is just about to increase to £11.99 a month; could you switch down to the Standard (save £36 a year) or Basic (save £72 a year)

Potential equivalent of £11.74 savings per month in these three.

Council tax spread over 12 months instead of 10?
Shopped around to make sure you're on the best electricity/gas, mobile phone tariffs possible?

Your total car costs come to £312.44 a month (£3749.28 a year), or more than 12% of your combined incomes. That's a massive chunk, are you certain there aren't any savings you can make here?

stinabean

Theamazingshrinkingwoman:
Hi Birthdays and Christmas tend to be an overdraft situation. We don't budget for them since LO came along as it's all been up in the air (pregnancy happened quicker than expected).
My prescriptions are currently free on my NHS exempt and OH doesn't have any. Same with dental, OH hasn't registered since we moved to Norfolk 2 years ago :mad: and hair we cut ourselves.
Takeaways are included in the food budget.

Willing2Learn:
Good idea, will do that in a mo and update my OP.
re unsecured debt, I have no idea what this means, sorry for my ignorance! Checked my SOA again though and it seems accurate.

Candyapple:
We'd love higher salaries! I'm on the highest I can go where I am, and as I work from home full time it's an ideal set up for our lifestyle so not keen to look anywhere else.
OH is earning the average for our area. Neither of us went to further education and therefore only get standard unskilled work.
We moved to Norwich for the cheapness, we're originally from South East.
I've got lots of baby clothes I've been trying to sell but no interest, doing a car boot sale at the end of the month to try and shift those plus other bits.
No idea re PSN, I had no idea it was so cheap upfront :eek: I shall discuss this with him tonight!
Spotify he won't budge on. I do not know why, I really don't. Will tackle it again tonight.
Netflix probably can downgrade, will take a look.
And need to pay for TV Licence as we get a tv package bundle with Virgin, so altho we really don't watch that TV I think we still need a licence because we could?

System

Life insurance is pretty steep - are you sure you need it? How old are you and your partner?

Willing2Learn

stinabean wrote: »

Willing2Learn:
Good idea, will do that in a mo and update my OP.
re unsecured debt, I have no idea what this means, sorry for my ignorance! Checked my SOA again though and it seems accurate.

Unsecured debt = your credit cards + windows + boiler

Your expenses (including the cards) is more than your combined income. Therefore you should not be able to afford to pay the credit cards each month, if your SOA is accurate.

Either you are overstating your expenses, or your combined income is higher (so that things balance out properly).


Edit: It is not as bad as I thought. I am reading your SOA wrong, as it was done using a format I am not used to. (I recommend using the format in EssexHebridean's signature)

stuart1975

Is there a reason he won't budge on Spotify?

Hunt out a three month trial on Google Music, or Apple Music.

I used to subscribe to Deezer, and everytime I cancelled, they would come back within a week or so with an offer of 3 months at 99p a month.

There are definitely alternatives out there...