Determined to do this!

Olddognewtricks

So, after reading many diaries I've decided to start one of my own.
Slightly different as I don't intend to start until the new year, mainly due to Christmas and my child's birthday being so close upon us. But you all seem like such nice people and I'm hoping you will tell me if I'm moving in the right direction.

Have spent so many years in denial about my debt, hiding it from everyone and, more or less, just about holding my head above water..... Although it's been touch and go on occasions I have decided its time to change my habits and clean up my finances.

Honestly I know its all my own doing. I've been a single parent from the day my ds was born, and I never wanted her feel like she was missing out, so every school trip or expensive electronics she wanted I've paid for, mostly by scrimping.
I do work full time and have done since she was little, and after a couple of small promotions I earn enough to keep us both comfortable, and any overtime boosts it significantly.

As things stand I am approx £8500 in debt. Mainly old defaults, but there is 1 ccj that will be paid by February next year. I know in the grand scheme of things it's not a massive amount but that is approx 25% of my annual income.

I do currently cover the majority of my child's expenses, as she is in college and although she does work 1 day a week to cover her social life and clothing, her money doesn't yet stretch to phone bills or helping with bills.... Luckily she helps with the housework and cooking in lieu of payment.

I am thinking that possibly snowballing the debt payments will be the best way to clear the balances, although one (hoist/cabot) of them is currently in dispute as I have 2 different companies wanting me to pay the debt I owe, but neither of them have been able to provide a cca as yet.

So soa:

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 1
Number of cars owned.................... 0

Monthly Income Details
Monthly income after tax................ 1275
Partners monthly income after tax....... 0
Benefits................................ 200
Other income............................ 200
Total monthly income.................... 1675

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 650
Management charge (leasehold property).. 0
Council tax............................. 90
Electricity............................. 40
Gas..................................... 40
Oil..................................... 0
Water rates............................. 35
Telephone (land line)................... 0
Mobile phone............................ 90
TV Licence.............................. 12.5
Satellite/Cable TV...................... 65
Internet Services....................... 0
Groceries etc. ......................... 200
Clothing................................ 20
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 35
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 15
Pet insurance/vet bills................. 25
Buildings insurance..................... 0
Contents insurance...................... 6
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 25
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 25
Total monthly expenses.................. 1383.5

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0
No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Opus 1.........................241.......20........0
Opus 2.........................268.......20........0
Ccj............................195.......60........0
Hoist .........................2297......50........0
Electric ......................1190......40........0
Gas............................3429......40........0
Vanquis........................140.......10........39.9
Bpo............................450.......40........0
Total unsecured debts..........8210......280.......-


Monthly Budget Summary
Total monthly income.................... 1,675
Expenses (including HP & secured debts). 1,383.5
Available for debt repayments........... 291.5
Monthly UNsecured debt repayments....... 280
Amount left after debt repayments....... 11.5

Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -8,210
Net Assets.............................. -8,210

Created using the SOA calculator at LemonFool.co.uk

The monthly Apr's are shown as 0 in most of them because they are defaults and the companies have stopped adding interest.

Although the form only let's me fill in monthly amounts I actually get paid weekly (Fridays) , with my benefits and maintenance paid monthly (29th and 1st respectively)
This does make it difficult to budget sometimes.

The vanquis card is not a problem, I have a very low limit of £500 on it, and tend to use it for food shopping etc and pay it off when I get paid every week. I have yet to pay any interest in the year I've had the card.

My gas and electric are payment cards and I put £10 each a week on all year round, so come these colder months I'm in credit on the machine and my payments stay consistent. This was my choice rather than have a lump sum coming out of my account when I wasn't being paid as much. The debt payments to these are made at the same time, so each week I put an extra £10 on each and the machines deduct the payment automatically.

I'm hoping to clear a large amount of this debt by the end of next year, so any help or suggestions, or even just encouragement is greatly appreciated.

And I've just realised how long my first post is, so I apologise for that

Willing2Learn

Hi,

Welcome to the forum

Just dropped by to wish you luck on your debt-busting journey.


I was wondering about the age of the Hoist account and what type of debt it was (loan, credit card, store card etc). If the account is a few years old and is eligible, then it may be worthwhile submitting a CCA request for it.

Well done on having the Vanquis and using it sensibly and without paying any interest...

Olddognewtricks

Hi, and thank you.
I've got into trouble with credit cards before (see below) so have tried really hard to be better with the Vanquis one, it has help that I haven't had an increase in the limit. I would probably decline it if they offered at the moment. It does what I need it to right now.

The hoist account is an old aqua credit card (told you) that defaulted in August 2014, over the past couple of weeks I've had communication from both hoist, and cabot about payment so am just in the process of wondering who to send my cca request to.

Just for clarification the payment to hoist in my soa is not yet happening, it's just that is what I could afford as and when it needs to.

enthusiasticsaver

I am assuming you have only just started to tackle this as you say you are saving £25 emergency fund and yet do not have any cash savings.

The things that stand out to me on your soa is your cable tv which is very expensive although it may include internet/Phone? The mobile phones are extremely expensive and could easily be brought down once you are out of contract. Paying £90 on mobile phones when you have debt and no savings is not advisable. Moving towards your daughter taking her own phone bill on will be doing her a favour in educating her about finances and prioritising them.

The positives are that you are not paying interest and are managing the Vanquis card well. I would suggest that asap you start to reduce the mobiles cost and actually start putting that £25 a month away in savings. I would also suggest you move towards not paying your gas and electric by payment meter in the long run as that is the most expensive way of buying it. Putting money away in savings to pay the bill or paying by monthly direct debit is better. Unless you have an injection of income I reckon it will take you almost 2.5 years to clear the debt.

The first thing to do though is to actually implement the budget and start making the payments and putting money away for the things like clothing, presents, emergency fund, vet bills etc and make the debt repayments.

You have nothing in entertainment so do you never go to the cinema or get a takeaway?

Olddognewtricks

Hi enthusiasticsaver, thanks for your comments.

I've probably made a mistake by completing my doa before actually starting my savings, but I wanted to get it all down so I could see if everything was possible. Payday tomorrow so my first 'savings' payment will be made. All but the hoist account are currently being paid on a monthly basis.

The cable TV does indeed include Internet and phone. And no I don't have a social life. At all(trust me I am not exaggerating about this in the slightest) The last time I went to the cinema was 2017, I don't drink either so I see the cable as my 'entertainment'

I realise the mobile bills are high, these have slowly crept up over the years, my daughter is only 16 so currently not able to have a contract of her own. I pay it out of the maintenance payment from her father.

The reason for having the prepayment meters was because a few years ago I was on a very low income, and generally very bad place financially so having a £50 direct debit coming out of my account would have meant no money for the rest of the week. I know it's not ideal but currently I have £52 credit on my gas and £67 on my electric, despite the cooler weather because I kept the same payments over the summer.

My current account balance is £47.56, but like I said it's payday tomorrow.

Olddognewtricks

Just as an addition,

My general debt levels are actually down from approx £12000 3 years ago.
That was when I get my last promotion at work. The payrise was significant considering I'd been on minimum wage, and less hours, for 10 years before that.

I've set my mind to cleaning up my finances, mostly for my own sanity but also to give my daughter the best role model I can now that she's becoming an adult.

I know it's not going to be an immediate result, but just seeing the numbers go down will be an achievement.

Olddognewtricks

Right, so last night I decided to look for a prepaid card that I can load up on pay day and accounts for all my weekly spend, just to limit the amount I carry my debit or credit cards when I go out.

Revolut had a deal where if you sign up and deposit £10 you get £10 free (so immediately I've made money) and has the option of having different 'vaults' for various savings that you can set up to automatically transfer from the main account. From what I can see the only way to access the money in the vaults is to actually close them ( I may be wrong)

My question is, will this be better than a physical envelope cash system? Or maybe a mixture of both would work?

My original thought was to have envelopes for food, clothes, travel and presents but now I'm thinking maybe I just need to get out cash for food shopping and transfer everything else to a card like that so I'm not tempted to over shop with cash around the house.

Olddognewtricks

So my mistake, today is Thursday not Friday, so payday is tomorrow ��

Spent £32.35 on food shopping this afternoon. Other than needing to top up the fruit bowl I shouldn't need anything else until shopping day next Thursday.

Ordered a revolt card and transferred £10.

So just over £5 left in my account till tomorrow.... And then the real fun starts

Olddognewtricks

Definitely Friday today, so first proper day of accountability.
As of this morning this is where I am. Some of my debts are paid weekly, some monthly so each week will be slightly different.

Have found the exact totals for the debts, on the positive side some of them are a little lower than I thought so already below £8k.

Ccj - £195. Paid £15. New total £180
Opus debt 1 - £241. Paid £00. New total £241
Opus debt 2 - £214. Paid £00. New total £214
Electric debt - £1159. Paid £10. New total £1149
Gas debt -! £3360. Paid £10. New total £3350
BPO debt - £430. Paid £10. New total £420
Hoist - £2273. Paid £00. New total £2273
Vanquis - £114. Paid £00. New total £114

Old total £7986
New total £7941

Savings totals - in vaults on revolut card.

Emergency savings £25/£500
Extra debt payments £10/£500
Change round up - £0/£200 (will round up and add automatically when I spend)

Cash balance on Revolut card.
£50 to cover weekly expenses! - probably too much but I will adjust as I need to.

Main bank account balance £80 that I'm going to try and not use this week. As far as I can see there's no direct debit due out till next Friday. I have £5 in physical cash in my pocket that I'm going to make last until the new card comes through, although I do have the option of adding the card to my Google pay now if something comes up.

warby68

Good luck with your plans and debt busting.

It seems like a good time to try and strengthen your finances as you aren't a million miles away from when you will no longer receive benefits or maintenance for your daughter and at the moment that £400 is essential.

It might seem an odd thing to mention but you do see posts on this forum from parents who were completely unprepared for the benefits to stop when their child finished education. Hopefully its all part of your planning.

She may of course start work, stay at home and contribute but if its university or leaving home you will need to be ready.

enthusiasticsaver

Good luck and I would be interested to see how you get on with the revolut card. I think that is a better way of keeping track than cash and an extra £10 to boot.

A large part of the debt is gas and electric. How come that is so high and are there any benefits you are entitled to?