Happier Nat's debt free diary

natlie

Hello

I'm Nat and I've been a member of this forum for years, I've even been on the Debt Free Roll of Honour in 2014 when I sold my house and paid off £38,000 of debt. 
Here I am again though in another £30k of debt and this time starting a DMP with StepChange, all of my paperwork has been sent to them and pending processing my Direct Debit and Contract I am good to go. 

My debt has always been down to the fact that my husband doesn't work, he finished work in 2009 with depression and has never gone back. I've had difficulty managing my budget and I got help with that from CAP in 2018. We had some support via ESA for a year in 2011 and then we became eligible for UC in August 2018 and I've paid off £3k of the debt myself but I am so sick of living a life based around food shopping and bills, I feel so bad for the kids who don't get anything. 

I've had a small windfall of £1.5k recently which I've put in an EF, thats been a big relief and I am looking forward to some reduced payments, I will be paying £677 a month instead of £1000 a month and will be debt free in early 2024.

I am posting up my SOA some of the calculations such as haircuts and clothing came from SC so are not really accurate as we are not spending on these currently, I also have an allotment which I pay £100 a year for that is not included in my SOA (no lines to include it)

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

Household Information[/b]

Number of adults in household........... 2

Number of children in household......... 2

Number of cars owned.................... 1[b]

Monthly Income Details[/b]

Monthly income after tax................ 2394

Partners monthly income after tax....... 0

Benefits................................ 570 (Universal Credit and Child Benefit)

Other income............................ 0[b]

Total monthly income.................... 2964[/b][b]

Monthly Expense Details[/b]

Mortgage................................ 0

Secured/HP loan repayments.............. 0

Rent.................................... 900

Management charge (leasehold property).. 0

Council tax............................. 158

Electricity............................. 50

Gas..................................... 41 38 Bulb let me reduce payment 

Oil..................................... 0

Water rates............................. 58 (Metered)

Telephone (land line)................... 0

Mobile phone............................ 18 (for 3 phones) 

TV Licence.............................. 13

Satellite/Cable TV...................... 30 9.99 (Netflix, Now TV (cancelled) & Amazon Prime)

Internet Services....................... 50 

Groceries etc. ......................... 420 400 have reduced my budget, going ok so far

Clothing................................ 72 (estimated by SC) 70 

Petrol/diesel........................... 35 (I cycle to work car is for family use)

Road tax................................ 0

Car Insurance........................... 47 £35 I have paid off this years in full and I am saving for next year 

Car maintenance (including MOT)......... 18.38

Car parking............................. 0

Other travel............................ 0

Childcare/nursery....................... 0

Other child related expenses............ 0

Medical (optician).... 10

Pet insurance/vet bills................. 0

Buildings insurance..................... 0

Contents insurance...................... 12

Life assurance ......................... 0

Other insurance......................... 51.65 payment holiday reduced to 22 (appliance insurance for elderly appliances) 

Presents (birthday, christmas etc)...... 200

Haircuts................................ 10 (estimated by SC)

Entertainment........................... 15 (estimated by SC) I don't budget for this outside of my DMP 

Holiday................................. 0

Emergency fund.......................... 1410[b] 1653.52 [b]

Total monthly expenses.................. 2209.03[/b] 2134.35[/b]

Assets[/b]

Cash.................................... 1653.52

House value (Gross)..................... 0

Shares and bonds........................ 0

Car(s).................................. 3000

Other assets............................ 0[b]

Total Assets............................ 3000[/b]

[b]

No Secured nor Hire Purchase Debts[/b]

[b]Unsecured Debts[/b]

Description....................Debt......Monthly...APR

StepChange.....................30205.95.....677.......0[b]

Total unsecured debts..........30205.95.....677.......-  [/b]

[b]

Monthly Budget Summary[/b]

Total monthly income.................... 2,964

Expenses (including HP & secured debts). 2134.35

Available for debt repayments........... 829.65

Monthly UNsecured debt repayments....... 677[b]

Amount left after debt repayments....... 152.65[/b]

[b]Personal Balance Sheet Summary[/b]

Total assets (things you own)........... 3,000

Total HP & Secured debt................. -0

Total Unsecured debt.................... -30,000[b]

Net Assets.............................. -27,000[/b]

[i]Created using the SOA calculator at www.stoozing.com. 

Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font] 

natlie

Setting up with StepChange for those thinking of taking the plunge has been easy. I wish I had done it much sooner. I used the online tool to see if i was eligible for a DMP then I had my initial dealings with them over a chat function on the website. 
It's been a week since I started and I've posted my agreement and direct debit mandate, I have sent them all of my account numbers, the only difficult one was PayPal Credit, but I managed to get my account number from them over the phone via customer services. 
I have cancelled all of my direct debits but at this moment all of my accounts are up to date. I haven't told my creditors yet, as I have been unable to get to the PO to post letters in the lockdown. If you visit the DMP thread they say to miss 3-6 months of payments but i decided not to do this as time is more important than my credit rating (Im already in the very poor bracket). 
I've spoken to SC on the phone several times in the past 5 days, to update my income and payments and tweak my budget, they are all really lovely people and so helpful, its been such a relief. 
I am just waiting now for confirmation that its all set up and a password for my account 
Nat

natlie

So yesterday evening I had a cheque clear in my account which has been moved to my EF and my SC DMP is all set up and ready to go on the 1st July. All my creditors have been contacted and offered payments. I am just waiting for my password from SC and confirmation of my DD date. I need to get my DF date from them too.

I thought it would be interesting to show my new payments for people who haven't been in a DMP before:

Card 1   Previous payment £348 New payment £215.55
Card 2   Previous payment £201 New payment £124.50
Card 3   Previous payment £64 New payment £39.64 (Payment accepted, no interest will be added & defaulted straight away) 
Card 4   Previous payment £60 New payment £37.16
Credit Account 1   Previous payment £247 New payment £152.99
OD 1   Previous payment £24 New payment £14.87
Loan 1   Previous payment £149 New payment £92.29

The payments aren't hugely different but this gives me £400 a month back, hopefully no interest and a debt free date sometime in 2024 

Nat

Baileys_Babe

Thank you for sharing @natlie
I was going to ask about your emergency fund/cash as on your SOA it is at 0, but you mention £1.5k windfall/emergency fund. It now looks like you were waiting for the cheque to clear before allocating it

How realist do you think the Step Change budget is for your family?

natlie

Hi @Baileys_Babe
I have allocated the cheque to my EF, I was going to offer it to one of my creditors as a F&F but decided that the EF was more important. 

I was surprised how high the payments were to SC, when they first did my budget with me the payments were £370 a month but after tweaking my budget sheet and being realistic my payments went up to £677 a month. It doesn't leave me a lot of wriggle room but its much better than the way that we have been living and now I have a budget for clothes, entertainment and haircuts etc, which we didn't have before. 

I am happy to pay the higher amount as should be DF by Jan 2024 
Thank you
Nat

EssexOstrich

Just wanted to say good luck  

Baileys_Babe

The emergency fund is high priority protecting you from incurring further debt down the line, what are your plans to meet your target?
I would suggest you keep a spending diary and record all you spending and allocate it to a category to see where your household needs funds. Do you really need Netflix, Now TV & Amazon Prime as well as a TV licence? We have a TV licence, Amazon prime, and £5.99 Netflix (which OH pays from birthday money from his parents) so we are not being martyrs about this, I just want you to question every cost and decide if it is effective so you can make the best use of your money.

Is everyone in the family on board with the new plan?

natlie

Hi  @Baileys_Babe
I have £85 available in my budget to put towards the EF. Its not much but there will also be surplus from the clothing and entertainment budgets too. 
I do need to be better with food, we probably have enough in store cupboard meals to last us a few weeks, but I still do a fortnightly shop. 
I have recently cancelled Disney+ the kids watch the Now TV, Netflix and Amazon Prime so I will need to have a chat with them about it. 
My husband doesn't know about the debt, he has depression and anxiety and I don't want to make him worry. We don't talk about money at all, he has no income and I have (poorly) managed all out finances. It's not been great for me dealing with all of this, I had a horrible time at work last year too as I was bullied and now thats all over and with the DMP I feel really relieved 

ImpulseSpender

Hi natlie,
Just wanted to say it must be so tough for you to deal with all of this on your own, I can't even begin to imagine. I know you can't feel like you can tell your husband about the debt but do you have anyone else in terms of support around you who knows about the debt and the DMP?

natlie

Thank you
Nobody knows about my debt and DMP except SC and this Forum. I don't know who I could talk to about it really. I don't have a lot of very close friends who I would feel happy disclosing this too and I definitely couldn't tell my parents. My sister might be most supportive but she lives very far away and has a lot going on herself and I wouldn't want to burden her with my problems 
Nat 

Baileys_Babe

Sorry to hear about your husband's health. 
Glad you are feeling relief and things are improving.

Regarding the grocery budget have you broken it down into different components food/toiletries/alcohol/cleaning materials to see if you can make savings in any of these categories, you might also find the grocery budget is also paying for the garden and toys and clothes or small electrical appliances.

Have you done an inventory of your store cupboards? @1LuckyLady in the small things thread regularly does this and anything that has been hanging around for a while goes in the use up box, so she can focus her meal plans to prevent items from going to waste.