Is Change possible? (When you're in a hole, STOP DIGGING!)

Lendrid

Hi,
I'm struggling to even write this to be honest. Putting it all down in black and white makes it feel so real. The very short version of our sorry tale is that I'm 40 in just over 2 years and over the past few weeks I've been feeling more and more uneasy about the financial situation myself and my partner are in. We have an absolutely wonderful 4 year old daughter, and I want her to have financial IQ so she never gets herself into the situation we now find ourselves. It's hard to know what to teach her when we are so lacking in financial education ourselves.

It might not be the best reason for becoming a debt free wannabee, but it's sure as hell motivating.

I guess (and it really is a guess) that the first step is to write down all the different debts. We've never budgeted but I imagine that comes next?

Going to post this now before I lose my nerve.

redofromstart

Good luck with making changes Lendrid, starting a diary may help with focus.

Its up to you how much you post, but sometimes just writing it all out in black and white (even if you don't share your statement of affairs on here) can really help with focus.

Lendrid

Thank you so much Redo, I was just about to start trawling the forum looking for SoA acronym. I came across it last night in the early hours but couldn't remember it today. I think it's a really good place to start (and easier than the amount of work we'll need to put in to gathering all the info needed for our first budget ever. Really appreciate you taking the time to reply xxx

Lendrid

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 2


Monthly Income Details
Monthly income after tax................ 0
Partners monthly income after tax....... 1897.17
Benefits................................
PIP 350.60
ESA 131.80
Child Benefit 82.80
Other income............................ Stu gigs variable
Total monthly income....................2462.37

Monthly Expense Details
Mortgage................................425.08
Secured loan repayments.......69.55 (loan attached to mortgage 6662.10 to pay 3.3A%APR) .................................................494.63 altogether
Council tax............................. 99
Electricity and Gas ..................£101
Water rates............................. £19.40
Mobile phone 1........................£10
Mobile phone 2........................£10
TV (Netflix)...............................£9.99
TV (Amazon)............................£7.99
Internet Services......................£25.45
Groceries etc. ......................... NO IDEA
Clothing................................ NO IDEA
Petrol/diesel........................... NO IDEA
Road tax 1................................£17.50
Road tax 2................................£12.77
Car Insurance 1 ......................(paid for the year until December)
Car Insurance 2........................71.46 Renewal due 2 months
Car maintenance (including MOT)..........NO IDEA
Other child related expenses..................£20 (classes)
Medical (prescriptions, dentist etc)..........£4.50 prescriptions Dentist ????
Pet insurance/vet bills.............................22nd 13.44 Hobson 9.84 Ravi excess £99
Buildings and contents insurance.....................43.65
Life assurance ......................... 41.48
Other insurance. Washing machine 8.49
Other insurance. Cooker..................7.81
Memberships...................................5.00
Memberships...................................4.30
Memberships...................................2.39

Presents (birthday, christmas etc)...... NO IDEA
Haircuts................................60
Entertainment...........................Spotify 9.99
Entertainment...........................Gym 22.40
Entertainment...........................Which 11.75
Holiday................................. 65.49 (for family holiday next year)
Emergency fund.......................... 0
Total monthly expenses..................


Assets
Cash.................................... 0
House value (Gross)..................... 125000
Shares and bonds........................0
Car(s).................................. 3000
Other assets............................ 0
Total Assets............................ 128000

Unsecured Debts
Description....................Debt......Monthly.. .APR
MBNA Credit Card £2200 (min payment £24 we've been paying £50) APR 0% until ???
Barclaycard £11000 (£270 min payment but we pay £300) APR 0% until Sept 2020
Tesco Loan £9623 (£107 monthly)
Halifax Credit Card 1 £0
Halifax Credit Card 2 £360 APR 0% until ???

Total unsecured debts........ £23 183


Monthly Budget Summary
Total monthly income....................
Expenses (including secured debts)
Available for debt repayments...........
Monthly UNsecured debt repayments.......
Amount left after debt repayments.......

Personal Balance Sheet Summary
Total assets (things you own)...........
Total HP & Secured debt.................
Total Unsecured debt....................
Net Assets..............................

Lendrid

I've done as much as I can stomach for now. I know it's far from complete, but we've just scared ourselves to death because we couldn't find house and contents payments anywhere, and thought we'd let them lapse. Turns out it's all fine but this is really another wake up call. Our finances are in pure chaos. Going for a coffee and shower. I'm so shaken up by all this.

NeverendingDMP

loving the honesty of no idea. looking at past statements may give you an idea. if not a spending diary going forwards

Lendrid

NeverendingDMP wrote: »

loving the honesty of no idea. looking at past statements may give you an idea. if not a spending diary going forwards

Spending diaries have just been started, thank you for the suggestion though. It's going to be key moving forward. May I just ask, how does the forum work as a diary? I'm new to this and wondering if I just post diary entries under the thread as I've been doing so far?

katsu

You can do this! DFW is a wonderful community.

Some ideas... why are you insuring your cooker and washing machine? You spend over £180 a year on that insurance and that would buy a washing machine. I'd cancel the insurances, work on getting debt free and saving an emergency/replacement house stuff fund instead.

Entertainment. I would take the Amazon, internet, Netflix, spotify etc as a list and think about reducing it . Also what do you get for £11 odd from Which? I'd trim that list and you'd clear the £360 odd at Halifax without noticing.

Your gas and electric are similar cost to mine but my buildings and contents insurance was under £150 for the year. I think you might be over paying so it's worth checking what you are insuring in terms of value etc.

Lendrid

Katsu thank you so much for your reply.

My partner is currently on the phone to washing machine insurance. It actually needs fixing which is why we didn't cancel it. It's been on the "to-do" list of jobs for many months now. (The problem is intermittent). Once finished on there he's going to cancel the cooker insurance too.

He's cancelled one of the memberships already, and I'm about to call Which? and cancel that too.

Just a little bit of background that might go some way to explaining why we've got to this position. I am currently unable to work due to severe mental health issues. I have fairly recently had a change of medication through my psychiatrist and just feel more able to address all this financial chaos, so I'm grabbing this "good" period with both hands and trying to make some profound changes to how we've been living.

Calling Which? is a big thing for me. Please send steadying vibes xxx

p.s. Thank you for the kick up the bum to sort these relatively easy wins. I appreciate your time xxx

Toni'sfriend

Calling Which? is a big thing for me. Please send steadying vibes xxx

If it's any help I find tackling things like that on the phone very difficult too so you're not alone in that one.

I'm so glad your medication is helping. There are lots of people like Katsu on here who will be able to suggest all manner of things to help you get your finances sorted out. Starting a spending diary is a great idea. Once you know where the money is going you'll be able to see where you can make the savings.

I'm sending you my best wishes and I'll be following to see how you're doing and sending some encouragement if I can. xx

redofromstart

Lendrid wrote: »

May I just ask, how does the forum work as a diary? I'm new to this and wondering if I just post diary entries under the thread as I've been doing so far?

Yes, just keep posting replies to yourself. Some people enjoy having others interact, others just keep track of themselves. If you read a few other diaries (threads) then you will get the idea, just join in and you find people often pay a return visit to yours.

I try to keep mine fairly anonymous, so my pets have nicknames etc.

Hope the phone call goes ok, hate doing those myself.