Our £20,000 Life

Cinny91

Hello anyone and everyone!

Well, I feel mightily ashamed. Poor choices, bad luck and general "well, we'll worry about it next payday" has left us in a mess. When we bought our home we were close to being Debt Free, and now look at us! We had to scrap my car recently, and we did purchase what I think is a sensible and budget(??? can you say "budget" when the money isn't yours?) friendly replacement car. But I'm frustrated, annoyed - sick and tired of being sick and tired. I've had many a LBM over our finances, but I guess sloth is my sin of choice and I'm very obliging when it comes to slipping into old habits. However, I don't think I've ever been quite so mad about it. Maybe I can swap sloth for wrath?

As things stand, our debt is a shiny round £20,000. I won't post our SOA yet as we have just pulled things tighter, and despite the colossal debt - I do, annoyingly, know what I need to do. I might post it further down the line if I feel we're not making enough progress.

We don't have a DFD goal, just to simply pay it down as quickly as we can. I'm normally one for big-picture-plans but as our lives and plans can flip in a day with a child, I'm focusing on the smaller stuff. Anyhow. On to some figures:

Loan: Sainsburys
Balance: £20,000
Repayment: £370.00 (ish, waiting on the full figures)
Term: 5 years

Alongside this there is one home improvement we are saving for - new windows. It's not just a cosmetic thing, but our current ones are old and damaged. Parts currently held together by gorilla glue. We're making it work for as long as we can but realistically there is a time frame on how long we can bodge it for. We save a little bit each month towards this, not huge but it will account for where some of our "free" money goes.

To save money we do cook from scratch. I make as many of our essentials as I possibly can (and by, have our essentials changed with a toddler) - bread, jam, cordial, fizzy drinks, baked beans, chicken nuggets, butter when I spot double cream stickered. Will try and do more as I think of things! Any suggestions are welcome

Today's small picture:
Swapped broadband and phoneline as our current provider isn't the greatest, new contract is £5pm cheaper and we'll be getting £200 in a mixture of cashback/reward cards.
I've also spent £3.62 on an aerial cable to see if the point in our bedroom works to cancel Sky multiroom and save £13 pm (will cancel multi room regardless but this will make our TV not rely on wifi)

Spends for today:
£3.62 - TV aerial. Will return if it doesn't work.
£8.99 - new hose connector for our pressure washer. Again, not 100% sure if it's the right one but I can return it if not.

Total - £12.61. Capping it at that!

clearmydebts

Quick reply to say I'm subscribing and will join you on your journey xx

Cinny91

Thanks CMD, off to find your diary now too

enthusiasticsaver

What interest rate are you paying on that loan? How much of the loan was for the car and how much for consolidating old debt? That indicates how much of your problem is overspending and how much is failing to save for the things you need like replacement cars and home repairs. Neither is ideal but I always think the second reason is better than the first as at least you have a comparable asset for the debt.

Is it worth overpaying on the loan rather than saving for the windows and then hopefully borrowing at 0% for the windows when the loan is much lower?


Grocery spends are often a good way of clawing back savings.

Cinny91

Hi Enthusiasticsaver!

The 0% loan window plan might be an idea some ways down the line. We're coming up to our third winter with them and while they're not the worst (we have lived with "vintage" single glazing before) they do lose us heat on top of having missing locks and probably being very easy to break into if we didn't live on such a quiet street with nosy (in a good way) neighbours. Not to mention we bought a blackout blind for LO - the sticky on type to save on getting a "real" one fitted - and every time I put it up it's a genuine concern the glass is so wobbly I might just topple on through. We do know a glazer so another option, to give us more time, will to get a quote for him to make some repairs. Definitely something to chew on though.

The debt is mostly our failure to get our heads above water with our car situation. We just about get one paid off when something goes wrong, we foot expensive garage bills for a while before waving the white flag and getting a "new" car. My new car is 25% of the loan, my DH's is 50% the other 25% falls into the failure to prepare. House repairs, appliances breaking etc which have accumulated. I don't feel like much of our debt comes directly from over spending - no credit card shopping sprees, for instance. But obviously we are overspending or we'd have savings to cover more emergencies than what we do.

Good news is we're getting £356.00 back in tax and I'll be due some back pay from work as my wages haven't been quite right recently. Not entirely sure how much, but it should be enough to pay a decent chunk off the loan.

beanielou

Happy shiny new diary

Cinny91

Morning Beanie

Went through to cancel my audible subscription - I am on a discounted rate of £3.99pm and do enjoy it but money is money. Anyhow, they offered me a free credit and I'll go through with the cancellation after I've picked another book. Also cancelled my Prime membership, so that will expire on the 3rd. Bit of a turkey move with that one as I do feel like we get our money's worth for the £7.99, but again it is practically £8 a month and it will deter me from that lovely simple 1 click shopping. That's £7.99pm currently saved, £11.98 once Audible is cancelled.

DH is also wanting us to cancel Sky completely. We're weighing up the pros and cons of switching to another cable provider or doing a monthly subscription like NowTV. We've been with Sky since we moved out over 10 years ago but customer loyalty counts for naught these days.

This morning I discovered the cheap coat I bought to replace the raincoat I lost is 100% not waterproof. I have some account credit at a local farm shop so I'm going to go have a look later today to see if there's anything I can get from there to save touching the bank.

We set out a basic monthly budget, bills included, and after mortgage, bills, standard payment on the loan, we have £1012.33 left to play with from DH's wages. My wage is paid on a Friday, currently £230.00 a week - so in August an extra £920.00. However, with rounding up our EF taking a huge chunk out of the left over money from DH's salary we currently have £271.61 in the bank with my wages due on Friday. I'm terrible at writing so I hope this all lines up. We can't overpay on the loan until our first payment has gone out so this month we'll be saving up money in a side account until we can pay it off.

enthusiasticsaver

Cinny91 wrote: »

Loan: Sainsburys
Balance: £20,000
Repayment: £370.00 (ish, waiting on the full figures)
Term: 5 years
!

I think the interest rate on that loan is around 4.25%. You will be paying around £2200 over the 5 years in interest.
For information if you overpaid £100 on that loan every month you would clear the loan a year earlier and save more than £520 in interest. Overpaying by £200 a month will save you more than £840 and clear the loan almost 2 years earlier. Play around with a loan overpayment calculator once you have done an soa.

Cinny91 wrote: »

Hi Enthusiasticsaver!

The 0% loan window plan might be an idea some ways down the line. We're coming up to our third winter with them and while they're not the worst (we have lived with "vintage" single glazing before) they do lose us heat on top of having missing locks and probably being very easy to break into if we didn't live on such a quiet street with nosy (in a good way) neighbours. Not to mention we bought a blackout blind for LO - the sticky on type to save on getting a "real" one fitted - and every time I put it up it's a genuine concern the glass is so wobbly I might just topple on through. We do know a glazer so another option, to give us more time, will to get a quote for him to make some repairs. Definitely something to chew on though.



Good news is we're getting £356.00 back in tax and I'll be due some back pay from work as my wages haven't been quite right recently. Not entirely sure how much, but it should be enough to pay a decent chunk off the loan.

I would put that in savings for now either towards your windows, other emergencies to stop you resorting to credit and maybe when the savings have built up make a lump sum repayment on the loan. Can you do the windows gradually and save up for them starting with the most urgent? That is what my daughter and her husband are doing. Sometimes it is cheaper to save up and get 2 or 3 done at a time but doing the whole house will work out at thousands instead of hundreds to do just a few. Get some quotes from local glaziers so you know what you are aiming for.

Cinny91 wrote: »

Morning Beanie

Went through to cancel my audible subscription - I am on a discounted rate of £3.99pm and do enjoy it but money is money. Anyhow, they offered me a free credit and I'll go through with the cancellation after I've picked another book. Also cancelled my Prime membership, so that will expire on the 3rd. Bit of a turkey move with that one as I do feel like we get our money's worth for the £7.99, but again it is practically £8 a month and it will deter me from that lovely simple 1 click shopping. That's £7.99pm currently saved, £11.98 once Audible is cancelled.

DH is also wanting us to cancel Sky completely. We're weighing up the pros and cons of switching to another cable provider or doing a monthly subscription like NowTV. We've been with Sky since we moved out over 10 years ago but customer loyalty counts for naught these days.

All these cancellations will add up and I think your DH is right to suggest cancelling sky. Amazon prime is just too much temptation. People think they are getting a bargain but it tempts them into buying more stuff they do not always need and it costs you £96 a year for the privilege.


As £15k of that loan is for cars you do have assets to show for it, albeit depreciating ones and I think the rate is quite good compared to many on here. I think I would focus on saving for now and maybe set yourself a goal initially of £100 a month overpayment on the loan and see how you get on with that and revise after a year. This is one reason I would never borrow for longer than 3 or 4 years for a car as it will often need replacing before you have finished paying for it.

Mnd

You don't need a glazier to re putty in a pane a glass. It's easy. YouTube will show you how

ratrace

Hello, this is coming from the right place as i have been in debt before so know its a bit of a crap place to be for now

can you oh sell his car and buy one for a lot cheaper from what you have said his car is worth 10k which to be frank is very very expensive, if it was me i would sell it and buy one for 5k and use the other 5k for the windows and put the rest in overpayments

you can buy a toyota yaris/auris for 5k all day long, cheap parts aswell, you may think that you are saving money by buying a more newer car but your not as the more expensive car will lose more in depreciation over time but you will not see it untill you come to sell it

ive just talked my sister out of buying a new car, her current one is costing her about £90 (avaerage over 12months) a month in repairs but yet she was willing to go and pay £250 a month on pcp because the new car came with warrenty failing to realise that she is paying for it in the montly price and after 3 years have no car etc...

hope i dont come across with my size 9's on as im coming from a place of concern, but for me getting new windows so my family could be more warm and have lower bills each month would be my main goal so i wpuld sell the car and drive an older 1 untill i saved for a better one

savingholmes

Just bobbing along to wish you good luck on your journey. It is good to recognise where you are but there is no need to beat yourself up about it - just put a plan in place to beat the debt and create a freedom fund.