Debt Advice

Fellalis89

I'm currently on shift and won't finish till tomorrow. Once home I will respond and send across my completed SOA

Fellalis89

Hello all,

Thank you for your messages. Please find my SOA below. 

In response to budgeting car maintenance, this is something I have never done and have used CC or borrowed money from someone to cover the cost. I have, for now, put £10 but obviously this won't be a true reflection of how much I actually need to budget.

The account fee will be cancelled, I am in the process of sorting breakdown cover as this, and mobile phone insurance, is what I have used it for but I can go without phone and travel insurance. 

Statement of Affairs & Personal Balance Sheet

Summary

Monthly Budget Summary	Amount(£)
Total monthly income	2,231.99
Monthly expenses (incl. HP & secured loans)	1,472.19
Available for debt repayments	759.8
UNsecured debt repayments	715.04
Amount left after debt repayments	44.76

Personal Balance Sheet Summary	Amount(£)
Total Assets (things you own)	127,000
Total Secured & HP Debt	-84,196
Total Unsecured Debt	-20,888
Net Assets	21,916

Household Information

Number of adults in household	1
Number of children in household	0
Number of cars owned	1

Income, Expense, Debt & Asset Details

Income	Amount(£)
Monthly income after tax	2231.99
Partners monthly income	0
Benefits	0
Other income	0
Total monthly income	2231.99

Expenses	Amount(£)
Mortgage	354
Secured/HP loan payments	141
Rent	0
Management charge (leasehold property)	0
Council tax	96
Electricity	68.5
Gas	68.5
Oil	0
Water Rates	28.78
Telephone (land line)	0
Mobile phone	10
TV Licence	13.37
Satellite/Cable TV	36.3
Internet services	0
Groceries etc.	100
Clothing	5
Petrol/diesel	400
Road tax	2.5
Car Insurance	36
Car maintenance (including MOT)	10
Car Parking	0
Other travel	0
Childcare/nursery	0
Other child related expenses	0
Medical (prescriptions, dentists, opticians etc.)	0
Pet Insurance/Vet bills	14.25
Buildings Insurance	4.5
Contents Insurance	4.5
Life Assurance	0
Other Insurance	0
Presents (birthday, christmas etc.)	0
Haircuts	5
Entertainment	0
Holiday	0
Emergency Fund	0
Gift	10
Account Fee	17
Amazon	7.99
Gym	39
Total monthly expenses	1472.19

Secured & HP Debt Description	Debt(£)	Monthly(£)	APR(%)
Mortgage	77729	(354)	4.24
Hire Purchase (HP) Debt	6467	(141)	7.9
Secured & HP Debt totals	84196	-	-

Unsecured Debt Description	Debt(£)	Monthly(£)	APR(%)
Admiral Loan	9479	322	13.09
Lloyds Loan	2710	153	22.3
MBNA Card	4572	50	20.93
DWP	139	10	0
Sofa Finance	255	42.52	0
Virgin Card	2933	87.52	23.29
Capital One Card	800	50	0
Unsecured Debt totals	20888	715.04	-

Asset Description	Value (£)
Cash	0
House Value (Gross)	120000
Shares and bonds	0
Car(s)	7000
Other assets (e.g. endowments, jewellery etc)	0
Total Assets	127000

NeverendingDMP

That's much clearer, shows where the money dissapears off to. The things with zero or low amounts you might allocate more money to once you get straighter as I'm pretty certain you will need to spend on those categories at some point.

The positives are
you do have a tiny surplus. I'd say use this as a buffer whilst you practice your budget. ive been "practicing" for few years now and things still crop up.

your new mortgage will save you over 50 pounds a month, emergency fund money maybe?

The furniture is nearly paid for so in Sept you will have another 45 spare.

It's up to you whether you choose to snowball and try and pay it all off or go for a dmp but a few things to consider for now are:

Is your council tax over 10 months. If so you can ask for it to be spread over 12.

Where do you buy your petrol from?  Are you signed up to everyone's loyalty cards so you can get money off vouchers, club card points, etc. Not sure what they have on offer but there must be something for the amount you spend and surely you can play them off each other and follow the offers.

What is your hp. I have no idea about these things but if its a thing where you have to have a balloon/end payment you might have to consider how that will affect you. 
Good luck with it all

kimwp

Great start to your SOA @fellalis89; a few thoughts:

- Income - if the government tax calculator didn't include pension and student loan repayments, the moneysaving expert take-home pay calculator does, so that should get you closer to the real figure. It also has the new tax and NI.
- For car maintenance, no-one can really predict the cost, but the total cost of the maintenance/services the previous year plus 10% is a good estimate.
- Mortgage - is this the value before or after the fix? (just worth bearing in mind)
- Is your gas and electricity the new figures after the cap was increased?
- Your water bill is a bit high for one person (more than double mine) - would a water meter help reduce this?
- Satellite/cable tv - if I was struggling with money, this is the first thing that would go (if out of contract of course)
- Groceries are low - if this is accurate then you are doing well, particularly if it includes pet food. It may be worth tracking your spend for a few months to check that this is accurate. 
- Petrol is obviously high but often can't be helped unless you have a gas guzzler. Worth considering liftshares for your commute (there are websites to find people) and your driving style in case driving differently would make a difference (it can make a significant difference)
- Do you use the gym enough to justify the expense? My personal view is that it can be justified, but if I was struggling, I'd be considering cheaper ways to stay fit eg YouTube aerobics, park runs etc. 
- Entertainment - do you spend anything on going out, meeting friends etc?

There seem to be a few categories where there's a low estimate - to really get a handle on your finances, I suggest going back through your accounts to get accurate amounts for these - or at the very least tracking them from now on. It's astonishing how they can vary from what you think you have spent.

Fellalis89

NeverendingDMP said:

That's much clearer, shows where the money dissapears off to. The things with zero or low amounts you might allocate more money to once you get straighter as I'm pretty certain you will need to spend on those categories at some point.
I haven't mananged my money properly, so I don't have a true reflection of these costings some of them I don't have at all like life assurance.

The positives are
you do have a tiny surplus. I'd say use this as a buffer whilst you practice your budget. ive been "practicing" for few years now and things still crop up.
Are you using any budgeting tools that you can recommend?

your new mortgage will save you over 50 pounds a month, emergency fund money maybe?

The furniture is nearly paid for so in Sept you will have another 45 spare.

It's up to you whether you choose to snowball and try and pay it all off or go for a dmp but a few things to consider for now are:

Is your council tax over 10 months. If so you can ask for it to be spread over 12.
I have checked and this is already spread over 12 months.

Where do you buy your petrol from?  Are you signed up to everyone's loyalty cards so you can get money off vouchers, club card points, etc. Not sure what they have on offer but there must be something for the amount you spend and surely you can play them off each other and follow the offers.
I will look into this as I normally go to a certain Tesco garage as it is cheapest in the area.

What is your hp. I have no idea about these things but if its a thing where you have to have a balloon/end payment you might have to consider how that will affect you. 
I think I have made a mistake here, this is my car finance not a hire purchase. However there is no lump sum at the end which is a bonus!

Good luck with it all

My response is above

Fellalis89

kimwp said:

Great start to your SOA @fellalis89; a few thoughts:

- Income - if the government tax calculator didn't include pension and student loan repayments, the moneysaving expert take-home pay calculator does, so that should get you closer to the real figure. It also has the new tax and NI.
- For car maintenance, no-one can really predict the cost, but the total cost of the maintenance/services the previous year plus 10% is a good estimate.
Thank you, I will go on this site instead and recalculate.
- Mortgage - is this the value before or after the fix? (just worth bearing in mind)
Before the fix.
- Is your gas and electricity the new figures after the cap was increased?
This is an estimation of monthly increases from the yearly increase they have sent across. I haven't received any updated figures on my new bill to date. Currently chasing for a clearer picutre but nothing. However I have cancelled my direct debit and will pay for what I use, so this could vary month to month.
- Your water bill is a bit high for one person (more than double mine) - would a water meter help reduce this?
Good idea, I thought this was a normal figure and have never considered a meter.
- Satellite/cable tv - if I was struggling with money, this is the first thing that would go (if out of contract of course)
100%, I am nearly at the end of the contract and will be changing to internet only when the option is available.
- Groceries are low - if this is accurate then you are doing well, particularly if it includes pet food. It may be worth tracking your spend for a few months to check that this is accurate. 
I won't lie, I don't track my spending on food and to be honest I have gone without on many occasions due to the worry all of this has caused I can't physically eat.
- Petrol is obviously high but often can't be helped unless you have a gas guzzler. Worth considering liftshares for your commute (there are websites to find people) and your driving style in case driving differently would make a difference (it can make a significant difference)
I will have a look and see if there are any. It is high due to the cost and how far I am going to be travelling. However once I get into the swing of it I will be able to reflect more of an honest figure.
- Do you use the gym enough to justify the expense? My personal view is that it can be justified, but if I was struggling, I'd be considering cheaper ways to stay fit eg YouTube aerobics, park runs etc. 
This is in the process of being cancelled, but won't be cancelled until July. Then no more gyms for now.
- Entertainment - do you spend anything on going out, meeting friends etc?
I rarely do anything like that because I haven't been in a financial position to do so. So this has been absolute minimal. Hence I can't even estimate how much I spend because it is few and far between.

There seem to be a few categories where there's a low estimate - to really get a handle on your finances, I suggest going back through your accounts to get accurate amounts for these - or at the very least tracking them from now on. It's astonishing how they can vary from what you think you have spent.
Do you have any suggestions of tools to use to help with this? I have my own tracker but there might be something more useful out there.

Thank you for your help

NeverendingDMP

Just to say I use an excel spreadsheet to work my budget out.in the beginning I just used to write down all spends till I figured out my bare minimum and my ideal. Some.people use something called YNAB.

There is a grocery challenge on the forums which might be a motivator for you. 

I think some.of your budgets need to be upped but that will take time for you to figure out qhats right for you

Good news about the car finance. Its not your explanation its my lack of knowledge avout which is which, I only mentioned it as other people seem to get really caught out by it!

Fellalis89

I will take a look at YNAB and see if it is more beneficial for me to use. And I'll check out those forums, they sound good and what I need! 

I agree about my budgets, I've never done it before hence why I'm here because I need to make a change.

A friend was trying to advise me to go into a hire purchase but it didn't make sense to spend that money and either give the car up or pay a lump sum. I'm so glad I didn't go with it!!

kimwp

Fellalis89 said:

kimwp said:

Great start to your SOA @fellalis89; a few thoughts:

- Mortgage - is this the value before or after the fix? (just worth bearing in mind)
Before the fix.
Which may mean that this figure increases - you won't know until the AIP is approved, but just something to bear in mind.

- Is your gas and electricity the new figures after the cap was increased?
This is an estimation of monthly increases from the yearly increase they have sent across. I haven't received any updated figures on my new bill to date. Currently chasing for a clearer picutre but nothing. However I have cancelled my direct debit and will pay for what I use, so this could vary month to month.
It's probably as good as you are going to get from an accuracy point of view. Note that a bill that varies from month to month will make it harder to budget, you really want regular payments to be as stable as possible, as annoying as it is for the utilities company to be holding your money. 


- Satellite/cable tv - if I was struggling with money, this is the first thing that would go (if out of contract of course)
100%, I am nearly at the end of the contract and will be changing to internet only when the option is available.
That's great news - also re the gym. There are loads of aerobics, pilates, weights videos on YouTube and you can zoom, FaceTime etc to do them "with" friends (though thinking about it, you can actually do them actually with friends as well now there's no lockdown Going for a walk with friends is cheap and good for feeling better about things too.

- Groceries are low - if this is accurate then you are doing well, particularly if it includes pet food. It may be worth tracking your spend for a few months to check that this is accurate. 
I won't lie, I don't track my spending on food and to be honest I have gone without on many occasions due to the worry all of this has caused I can't physically eat.
Ok. As with everything else, it is worth starting to track this. I'm sure there are helplines to help with the stress of this etc, but it's not my area so hopefully others will comment. I hope that the help you get on here will help lift that worry - it really is a solvable situation. 

- Petrol is obviously high but often can't be helped unless you have a gas guzzler. Worth considering liftshares for your commute (there are websites to find people) and your driving style in case driving differently would make a difference (it can make a significant difference)
I will have a look and see if there are any. It is high due to the cost and how far I am going to be travelling. However once I get into the swing of it I will be able to reflect more of an honest figure.
OK - is this an over or underestimate?

- Entertainment - do you spend anything on going out, meeting friends etc?
I rarely do anything like that because I haven't been in a financial position to do so. So this has been absolute minimal. Hence I can't even estimate how much I spend because it is few and far between.
Ok. Once your SOA is a bit more stable (ie you know your new income/fuel spend, have your mortgage fixed) and sensibly frugal (cut back to sensible necessities, but with a sensible food budget for when you are eating properly again) then I think you need to look at a sensible budget for this. It's essential to socialise and feel connected, otherwise the worries take too large a home in your head. If your current friends can't be persuaded to do this on your budget, then it's a good opportunity to meet other people - have you heard of meet-up?

There seem to be a few categories where there's a low estimate - to really get a handle on your finances, I suggest going back through your accounts to get accurate amounts for these - or at the very least tracking them from now on. It's astonishing how they can vary from what you think you have spent.
Do you have any suggestions of tools to use to help with this? I have my own tracker but there might be something more useful out there.
I use an excel spreadsheet that I created myself - happy to share, but it's very much tailored to me (eg there's a row titled "socialising" is where I put meals out or food bought to share with friends to keep an eye on but mostly accept on a wellbeing basis, but a row for junk food/takewaways which I'm trying to eliminate for example). There are loads of tools though, probably a google of "moneysavingexpert budget tool" and similar searches would find some good threads on this forum.

Thank you for your help

You are very welcome. I've replied above where I think I can help further, but as with anything, take what's useful and ignore the rest. I've asked some of the questions about whether figures might change because it might push you into where it's worth considering a DMP - not something to worry about, but just a different way of solving the issue.

You can do this.

kimwp

Just spotted the earlier post where you said you overestimated your petrol spend and that your mortgage payments are likely to reduce - that's great. If you post your SOA again - (not saying you should as it can lead to confusion with people commenting on earlier posts, but if you do), might be worth a little note by each to say "expected to drop to xx" and "overestimate until accurate figures known" to prevent people like me forgetting details from earlier and commenting again on them