Debt relief options

Mum2Boys_2

I work with the ages 11-16 so definitely could learn! 

I agree that I have absolutely lived beyond my means and over spent. When I brought my ex out I didn’t account for the work that needed to be done (windows, doors facias as well as repair to roof beam and fence). This is where the majority of my debt has accumulated as well as eating out, yearly holidays to Cornwall etc, we massively spent less last year on these things and I have not purchased clothes, toys or films since December. We are working on living within our means and then boys have adjusted really well and I’m so proud. I think I will stick with the second SOA that has been done for me as if we are going to eat out or have a takeaway, this I believe needs to come from my weekly budget as a treat rather then budgeting for it because these things are a luxury and being in lockdown has taught me that. 

Before November last year I’d of thought nothing of spending £30 for a Pizza Hut for the night, I now go down to Aldi and spend maybe £5 including a dessert, this is the mindset we are in now and I want to stick with it really. 

Willing2Learn

Nooooooooooooo!!!    Don't stick with MKII as the numbers are all wrong and it won't work out for you.  the MkII budget has shortfall of £400.   If you were to follow that, then you will be in all kinds of trouble.  If you want to do this right, then I am afraid you will have no choice but to go through a years-worth of transactions.  Just do it when you have the time.  Next weekend maybe...or the weekend after....but do come back...

You're a key-worker.  We need to ensure that we are getting you a budget that allows you to save an emergency fund, a holiday fund etc etc.  These things may all be possible if you were to budget correctly.



We can help you calculate and maintain a sustainable budget for you and your kids.   You just need to persevere...

Mum2Boys_2

I could go through a years worth of transactions but I don’t feel that will give us a true reflection because I was frivolous compared to the past 6 months and I don’t want to allow for that kind of spending. I overspent and that’s racked me up £5k on a credit card, I need to live within the means of my £118 a week budget otherwise I’m spending what I do not have, causing me to fall further in to debt. I will definitely allow for clothes and some small gifts but holidays are a luxury that for the next few years I will not be able to afford and I need to accept that. 

I need to tweak my food absolutely, the past 6 weeks I’ve been spending between £90-£100 where as before (ASDA click and collect) I would spend around £60-£70, I think whilst we are in lockdown I can expect to pay more although I’ve not put fuel in my car since the lockdown so it’s balancing a little. 

I agree I need to tackle my energy costs and I have tried contacting them, I need to continue this. 

I’m considering giving up the gym as I’ve been doing workouts at home during lockdown and it’s doable. 

And my car insurance has just rolled over, I left it as to be honest I’ve been on the phone so much that it was one I thought I’d tackle next, I did an online quote and my current provider offers me the same cover for £24 a month less, this is on my to do list for Monday after a conference. 

If I make these savings, that’s an extra £11 a week which I will put into a entertainment fund. 

Willing2Learn

Idea ….  Instead of going through a years-worth of transaction you could alternatively get yourself a little notebook and pen, then write down every transaction you make from this moment onward.  You will then have the evidence to support your budget planning.

As you work with vulnerable young people, then you know why you need the evidence to support your gut assertions on your monthly expenditure.

We can really help you to have a life with lower stress level.  Put simply, 'perseverance' and 'evidence' are the two magic words 

Hopefully, we will see you again and we can continue working on your budget...

Mum2Boys_2

I am going to do the notebook thing, I’m also going to keep receipts. 

I think reading through some of the other forums and posts my costs are manageable although a bit life limiting. 

I plan to call Halifax to request an extension of my interest free period as this increase has hit me hard. My friend is due to go back to work next week so I could continue to clean his house which will start to bring in that extra bit of money again. This money is at the moment not accounted for so perhaps I could use some of that for my emergency fund and some towards entertainment.
 My boys don’t go without, my brother and sister are very generous with supporting us, they have Disney plus, prime etc, not to mention gift vouchers for go Karting, crazy golf etc. 
My littlewoods will not exist in 3 months, £50 saving there, and my car will be paid of March next year, another £174 a month saving. 

If I continue with this budget living I can get us out of this mess. 

Thank you for all of your advice. 

enthusiasticsaver

The second soa shows £300 on clothing so that is presumably an error so the shortfall is not £410. 

enthusiasticsaver

Willing2Learn said:

Okay then.  Here is Mark II:

[font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]

Household Information[/b]
Number of adults in household........... 1
Number of children in household......... 3
Number of cars owned.................... 1[b]

Monthly Income Details[/b]
Monthly income after tax................ 1208
Partners monthly income after tax....... 0
Benefits................................ 1199.44
Other income............................ 0[b]
Total monthly income.................... 2407.44[/b][b]

Monthly Expense Details[/b]
Mortgage................................ 403
Secured/HP loan repayments.............. 525
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 94
Electricity............................. 75
Gas..................................... 75
Oil..................................... 0
Water rates............................. 38
Telephone (land line)................... 0
Mobile phone............................ 60
TV Licence.............................. 13.2
Satellite/Cable TV...................... 0
Internet Services....................... 53.96
Groceries etc. ......................... 300
Clothing................................ 300 This is incorrect as you said you will only be getting them for birthdays and xmas
Petrol/diesel........................... 200
Road tax................................ 300 Surely this is incorrect?
Car Insurance........................... 64.18
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 128
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 8.26
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 60
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Gym..................................... 20[b]
Total monthly expenses.................. 2717.6[/b]
[b]

Assets[/b]
Cash.................................... 0
House value (Gross)..................... 215000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0[b]
Total Assets............................ 215000[/b]
[b]

Secured & HP Debts[/b]
Description....................Debt......Monthly...APR
Mortgage...................... 0........(403)......0
Secured Debt.................. 0........(351)......0
Hire Purchase (HP) debt ...... 0........(174)......0[b]
Total secured & HP debts...... 0.........-.........-   [/b]

[b]Unsecured Debts[/b]
Description....................Debt......Monthly...APR
Littlewoods....................0.........50........0
Card...........................0.........50........0[b]
Total unsecured debts..........0.........100.......-  [/b]

[b]
Monthly Budget Summary[/b]
Total monthly income.................... 2,407.44
Expenses (including HP & secured debts). 2,717.6
Available for debt repayments........... -310.16
Monthly UNsecured debt repayments....... 100[b]
Amount short for making debt repayments. -410.16[/b]

[b]Personal Balance Sheet Summary[/b]
Total assets (things you own)........... 215,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -0[b]
Net Assets.............................. 215,000[/b]

[i]Created using the SOA calculator at www.LemonFool.co.uk.
Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]

There is £600 in that which should not be there so I think it is perfectly possible for you to get out of this so I think that should read £190 surplus. We need the balances of the secured and unsecured debts and the interest rates. 
Initially when you said you had £120 free I assumed you meant monthly to  cover food and fuel so weekly is a different matter and perfectly doable I would assume depending on how much you actually spend at the moment.  Dig out your bank statements and check to see what the actual spend is. 
You also need to put something in emergency fund so you have a savings pot if you have an unavoidable expense to stop you putting more  on credit.  If you only have the catalogue and credit card as unsecured debt I do not see how a DMP will help you.  All the other debts are secured so you run the risk of losing your house/car if you do not keep up with those. Depending on how high the Halifax credit card is asking them to lower the interest rate may lead to a default but it does depend on the balance as to whether it is worth trying to do that. For a fairly low balance I would not risk your credit file for the sake of some short term pain.  

Willing2Learn

Yup it is the £300 road tax that is getting all the numbers out of sync.  I did it all too quickly lol....  Well spotted you eagle-eyed hounddog...


And the clothing is wrong too...should have read £30/month....so there we have it...evidence to support the claim that I am an idiot....

just_trying

Fuel is wrong as well she said it's £50 a month at most.

Willing2Learn

I **think** I have it right now 


[font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]

Household Information[/b]
Number of adults in household........... 1
Number of children in household......... 3
Number of cars owned.................... 1[b]

Monthly Income Details[/b]
Monthly income after tax................ 1208
Partners monthly income after tax....... 0
Benefits................................ 1199.44
Other income............................ 0[b]
Total monthly income.................... 2407.44[/b][b]

Monthly Expense Details[/b]
Mortgage................................ 403
Secured/HP loan repayments.............. 525
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 94
Electricity............................. 75
Gas..................................... 75
Oil..................................... 0
Water rates............................. 38
Telephone (land line)................... 0
Mobile phone............................ 60
TV Licence.............................. 13.2
Satellite/Cable TV...................... 0
Internet Services....................... 53.96
Groceries etc. ......................... 250
Clothing................................ 30
Petrol/diesel........................... 250
Road tax................................ 300
Car Insurance........................... 64.18
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 128
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 8.26
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 60
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Gym..................................... 20[b]
Total monthly expenses.................. 2447.6[/b]
[b]

Assets[/b]
Cash.................................... 0
House value (Gross)..................... 215000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0[b]
Total Assets............................ 215000[/b]
[b]

Secured & HP Debts[/b]
Description....................Debt......Monthly...APR
Mortgage...................... 0........(403)......0
Secured Debt.................. 0........(351)......0
Hire Purchase (HP) debt ...... 0........(174)......0[b]
Total secured & HP debts...... 0.........-.........-   [/b]

[b]Unsecured Debts[/b]
Description....................Debt......Monthly...APR
Littlewoods....................0.........50........0
Card...........................0.........50........0[b]
Total unsecured debts..........0.........100.......-  [/b]

[b]
Monthly Budget Summary[/b]
Total monthly income.................... 2,407.44
Expenses (including HP & secured debts). 2,447.6
Available for debt repayments........... -40.16
Monthly UNsecured debt repayments....... 100[b]
Amount short for making debt repayments. -140.16[/b]

[b]Personal Balance Sheet Summary[/b]
Total assets (things you own)........... 215,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -0[b]
Net Assets.............................. 215,000[/b]

[i]Created using the SOA calculator at www.LemonFool.co.uk.
Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]


Edit:  It is only MKII however.  It still needs a lot of work before it becomes realistic...