Daisy's debt rambles 6 November 2020 at 9:56AM in Debt free diaries 3 replies 151 views

daisyiggle

I wasn't sure if this was the right area of the forums for me, but ultimately, I have debt I do want to pay it down and eventually be completely debt free and work towards eventual (long long loooong time eventual) mortgage freedom and maybe, if I say it quietly enough, early retirement.

In terms of debt busting, I (we) started 2020 with £10933 on 3 credit cards plus some furniture 0% finance.  It has been higher than this, I never totted up the full amount but I'm pretty sure towards the end of 2018 we were at 15/16k comprising of cards and a loan.  As it stands today, I have £4902.5 on one card at 0% and 1120(ish) on a 0% furniture finance deal. 

A little background about life situation.  I am early 30's with a mid 30's DH and a 1 year old munchkin.  I work full time and my DH works 8 hours a week at the weekend and looks after munchkin.  We live in Lincolnshire so should be low housing costs, but when travel is permitted, quite high commuting costs for me as I work in Insurance so pretty much have to travel out of county for any decent job opportunities.  Currently WFH full time but I expect to back in Leeds once or twice a week eventually.

I've spent this year tracking spends, every single one, to get a better idea of a realistic budget.  I'm now gearing up to implement that in 2021 and really make our money work for us instead of frittering away money on nothing.

My (our) goals for the coming year (and beyond):

• Save for next maternity leave.  We'd like a second munchkin in 2022 so need to put some money away for the period of leave on SMP.  I reckon 6k would cover it.  I only took 6 months with munchkin, unsure how much I'll want for munchkin 2 but 6k would cover 3 months (and a bit).
• Save to become 'debt neutral'.  The remaining debt is on 0% so from now I'm putting money into savings instead of paying off the debt (I originally had repayments set up for the debt to be gone by the end of the 0% period).  So now I have a DD for the minimum payments and the rest of the payment is being put away.  I prefer to have the cash available.  Please tell me if this is silly.  0% ends in April 2022.
• Save for a new car.  We currently have a 3 door hand-me-down car.  In fact I've owned 2 cars in my life and they've both been hand-me-downs!  Not enjoying the prospect of actually purchasing one but it's been a bit of a faff with a 3 door car and a munchkin.  I don't fancy doing it with 2 munchkins!  So 5k?  I'm not fussed about cars so that should get us a half decent run around outright.

Longer term:

• Eventually move house (maybe).  We're in a lovely 3 bed right now but with potential 2 munchkins and the need for some WFH space we'll either have to move or create some space somehow.  It's 10 years old so no scope for a loft conversion (without paying ridiculous money), maybe a partial garage one for an office space.  We're still discussing this  But no plans to move for a good few years yet.

I'll post my current SOA on the next post to avoid this one becoming a monster!

daisyiggle

So this is my current SOA, the figures are an average monthly for the last 10 months, I can already spot some areas of savings in it but I think it's fairly healthy.  I want to maximise saving potential as much as possible without living on beans on toast for a year!

Household Information[/b]
Number of adults in household...........	2
Number of children in household.........	1
Number of cars owned....................	1
Monthly Income Details
Monthly income after tax................	2849
Partners monthly income after tax.......	280
Benefits................................
Other income............................ 0
Total monthly income....................	3129
Monthly Expense Details
Mortgage................................	900
Secured/HP loan repayments.............. 0	0
Rent.................................... 0	0
Management charge (leasehold property).. 0	0
Council tax.............................	167
Electricity.............................	57.05
Gas.....................................	0
Oil..................................... 0	0
Water rates.............................	47
Telephone (land line)................... 0	0
Mobile phone............................	19
TV Licence..............................	13
Satellite/Cable TV......................	8.99
Internet Services....................... 0	21.95
Groceries etc. .........................	448
Clothing................................	40
Petrol/diesel...........................	35
Road tax................................	14
Car Insurance...........................	22.5
Car maintenance (including MOT).........	25
Car parking............................. 0	0
Other travel............................ 0	0
Childcare/nursery....................... 0	0
Other child related expenses............ 0	0
Medical (prescriptions, dentist etc)....	0
Pet insurance/vet bills................. 0	0
Buildings insurance.....................	11
Contents insurance...................... 0	0
Life assurance .........................	23
Other insurance......................... 0	9.5
Presents (birthday, christmas etc)......	67
Haircuts................................	5
Entertainment...........................	144
Holiday................................. 0	117
Other - House stuff and my misc category	65
Emergency fund..........................
Total monthly expenses..................	2259.99
Assets
Cash....................................	22140
House value (Gross).....................	185000
Shares and bonds........................
Car(s)..................................	800
Other assets............................
Total Assets............................	207940
Secured & HP Debts
Description....................Debt......Monthly.. .APR
Mortgage...................... 174500   831         4.54
Total secured & HP debts...... 139000....-.........-	174500
Unsecured Debts
Description....................Debt......Monthly.. .APR
Natwest………………4920…….1% minimum……..	50
DFS                                   ?              32           0	32
Total unsecured debts..........6000 ish.........-	82
Monthly Budget Summary
Total monthly income....................	3129
Expenses (including HP & secured debts).	2259.99
Available for debt repayments...........	869.01
Monthly UNsecured debt repayments.......	82
Amount short for making debt repayments. -	787.01
Personal Balance Sheet Summary
Total assets (things you own)...........	207940
Total HP & Secured debt.................	174500
Total Unsecured debt.................... -	5765
Net Assets.............................. -	22190

For clarity:

• Our mortgage is a 5 year fix ending in 2023.  We were FTB with a 5% deposit so the rate isn't great.  Might look to remortgage early once the penalty for doing so is a little lower, but right now the sums don't add up.  We rounded up the mortgage DD to get some sort of overpayment so we're in the best possible shape when coming to re-mortgage.  
• Our grocery spend is higher than I thought it would be.  It does include toiletries and nappies but I think there's room for improvement.  I do meal plan, but maybe I just plan expensive meals!
• Entertainment is mainly comprised of eating out & takeaways.  I see immediate savings to be made there.
• Clothing is mainly munchkin.  I didn't think I spent that much but I guess it adds up when she needs a new set of clothes/shoes every 3-6 months!  She's coming up to 18 months now so in theory the rate of wardrobe replacement should slow down.

daisyiggle

Oh the 18500 in cash is DH inheritance from his Grandpa.  That only came through last month and we have no idea what to do with it, so it's sat in savings at the minute with the idea that it'll form a part of a deposit on the next house or changing this house to have more space.  

Sarahwithlove

Groceries even with Nappies is high. Look at what brands you re using and see if anything can b downgraded. When you menu plan do so from freezer and store cupboards. Have some easy and simple meals a favourite in our household is a baked potato with beans and cheese or tuna mayo. In regards to little ones clothing maybe look at see if you can get any second hand and use supermarkets to buy it. They don't need branded at that age. Good luck on your journey. 
In regards to being debt extras are you certain that if it's in savings you won't be tempted to spend it?