Debt... incoming

AnnieB2018

LBincoming said:

 I haven’t yet been able to find a double pushchair for under £900 on Facebook, but I’m keeping an eye!

What brand are you looking for? Even a second hand Bugaboo Donkey won’t ever be more than £500. On Buy Now you can get one on Ebay for £360 plus 50 postage but I’m sure it will go for much less at auction, even better if you find one locally and save on postage.

LBincoming

Ideally the Bugaboo Donkey haha! The cheapest I can find in my area is £900, but I’m keeping my eyes peeled as still got a few months yet to get one.

fatbelly

The rules changed on council tax a few years back. Everyone has the right to pay in 12 instalments and the council usually puts this in tiny type on the annual bill.

If you go on to the council's website there should be a variety of options for payment. I ticked 12 instalments on the 20th of each month, as that pushes it  out as far as it will go.

Should make quite a difference for this year as you may have already paid 4/10 instalments so the remaining 6 get spread over 8 months - in round terms that might save £50 per month.

As another point you mentioned that selling the cars wasn't worthwhile. You are not allowed to sell an item on HP as you are not the owner. The factsheet I linked to earlier explains this, and your Consumer Credit  Act right to terminate - so it's a little different to a mortgage even though it's like a loan secured on something.

You spend a lot on electricity - and rates are going up. There are some fixed deals worth considering and Martin has an article here

https://www.moneysavingexpert.com/utilities/-are-there-any-cheap--fixed-energy-deals-currently-worth-it--/

LBincoming

fatbelly said:

The rules changed on council tax a few years back. Everyone has the right to pay in 12 instalments and the council usually puts this in tiny type on the annual bill.

If you go on to the council's website there should be a variety of options for payment. I ticked 12 instalments on the 20th of each month, as that pushes it  out as far as it will go.

Should make quite a difference for this year as you may have already paid 4/10 instalments so the remaining 6 get spread over 8 months - in round terms that might save £50 per month.

As another point you mentioned that selling the cars wasn't worthwhile. You are not allowed to sell an item on HP as you are not the owner. The factsheet I linked to earlier explains this, and your Consumer Credit  Act right to terminate - so it's a little different to a mortgage even though it's like a loan secured on something.

You spend a lot on electricity - and rates are going up. There are some fixed deals worth considering and Martin has an article here

I’ll have another look at the council tax - thanks!

The electric bill is gas and electric combined, it’s gone up from £140 a month with the recent energy price changes. We’re doing everything we can to cut back on our energy usage. I’ll definitely have a look at alternative fixed deals though.

I did read the fact sheet you linked, but surely places like we buy any car you can sell? As they’ll usually pay the debt off? We’re not in a position to sell either of the cars yet anyway, but I’d like it as an option possibly next year ideally.

Thanks for your help 

fatbelly

WBAC won't give a market price for a car. This sounds good:

https://www.webuyanycar.com/car-finance-calculator/selling-a-car-with-outstanding-finance/

But as I said earlier, the devil's in the detail. I suspect the point at which their 'valuation' would cover the shortfall on an HP agreement would be very late in the agreement period and you would be better completing the HP and selling a fully owned car normally.

Or doing a voluntary termination once 50% had been paid.

To be fair to WBAC the information on their site is very good, including how S99 of the CCA works

https://www.webuyanycar.com/car-finance-calculator/cancelling-car-finance-early/

LBincoming

fatbelly said:

WBAC won't give a market price for a car. This 

But as I said earlier, the devil's in the detail. I suspect the point at which their 'valuation' would cover the shortfall on an HP agreement would be very late in the agreement period and you would be better completing the HP and selling a fully owned car normally.

Or doing a voluntary termination once 50% had been paid.

To be fair to WBAC the information on their site is very good, including how S99 of the CCA works

We did get a good price with them for my husband’s old car, same as any other garage we’re offering anyway. Mine went for scrap haha. Think we’re stuck with the cars for at least a while longer. 

I’m going to look more in depth at our food bill, the phone contracts we have and also see if I can boost our income further with my side hustle. 

Grumpelstiltskin

You do need to go through everything with a fine toothcomb.

For instance how much do you spend on ready prepared baby food?

Do you buy ready prepared meals for yourself and your husband?

Do you know what time your supermarket has reduced offers?  Lidl is usually first thing in the morning.

Your husband needs to be 200% with you on this, I'm sure he doesn't need to go to the barbers every 2 weeks, he might want too but at the moment it's needs not want.


Edit     Have you discovered the Old Style board on here?

Old Style MoneySaving — MoneySavingExpert Forum

They have loads of money saving ideas.

powerspowers

Congratulations on baby number 2 and well done for recognising early that your heading into debt. 

To be honest, although there’s well meaning advice on shaving bits off haircuts, grocery, tv licence etc which will all add up, your biggest expenses are the 2 cars. Focusing on those will make the biggest impact on your availabile cash, allowing you to save for maternity leave and pay nursery fees. I’d be seriously looking at options to trade them in for something cheaper as it’s unaffordable on your current wage. Ideally you need to be building up a buffer, otherwise when washer blows up or whatever you end up taking on more debt. 

Good luck! 

EssexHebridean

LBincoming said:

ratrace said:

this is the link to the soa

Giving a full breakdown of your situation.

Format for MSE and put it on here.

Think I’ve managed! Thank you! I did a similar one earlier for my figures, just the MSR budget planner excel sheet, but here’s the lemon fool one.

[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......... 1

Number of cars owned.................... 2[b]

Monthly Income Details[/b]

Monthly income after tax................ 1633

Partners monthly income after tax....... 1830

Benefits................................ 82

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

Total monthly income.................... 3545[/b][b]

Monthly Expense Details[/b]

Mortgage................................ 675

Secured/HP loan repayments.............. 762.74

Rent.................................... 0

Management charge (leasehold property).. 0

Council tax............................. 215 Assume you have checked this is correct? There's a section on the main MSE site about this - that feels like a high figure for the property value though

Electricity............................. 223 This isn't as stand-out high as it once was but it it still a fair bit up on where I'd think it could be. Have a think about where you can trim use, and make sure you're giving regular meter readings (or checking smart meter readings if you have one of those) to be sure your estimated annual use figure is accurate. 

Gas..................................... 0

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

Water rates............................. 29 Metered I take it? Again - have a think where use can be trimmed a little.

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

Mobile phone............................ 47 Even for two, this is high. Have a look on the main MSE site for the current "best buy" deals for SIM only plans - and if it helps, I currently have unlimited calls/texts plus 10gb data with EE for under £10 a month - I could get cheaper than that, too! 

TV Licence.............................. 12.5 Check this - I think it's more like £13.37 a month now?

Satellite/Cable TV...................... 0

Internet Services....................... 29 You might be able to get better than this too - again - the main MSE site is your friend here. 

Groceries etc. ......................... 250 Definitely room for some tweaking here!

Clothing................................ 50 

Petrol/diesel........................... 300 Make sure you're driving as economically as possible, and combine journeys or walk/cycle where possible.

Road tax................................ 5

Car Insurance........................... 70 diarise to get renewal quotes at the right time to see if any savings can be made here.

Car maintenance (including MOT)......... 10 for TWO cars? Does your finance deal include all servicing, other maintenance, tyre replacement etc? If not, then what happens when you  need a service as this will barely cover an annual service on one, never mind anything else that needs doing! We budget £165 a month to cover our two - that's a little above where we need to be now we both have slightly newer (but still of MOT needed age) cars - that includes insurance too, without that if I was redoing my figures now I'd be looking at budgeting around £70 a month to cover the two for maintenance and depreciation I think.  

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

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

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

Other child related expenses............ 40

Medical (prescriptions, dentist etc).... 0

Pet insurance/vet bills................. 14

Buildings insurance..................... 22 Hopefully this includes contents as well?

Contents insurance...................... 0

Life assurance ......................... 62

Other insurance......................... 0

Presents (birthday, christmas etc)...... 80 OK - but is this actually being saved? I ask because we're half way through the year and you only show £200 in cash assets - some of which is presumably from other things you budget for monthly as well? It  may be that all your family birthdays happen in the first half of the year though.

Haircuts................................ 70 HOW much?! This is seriously a lot ! As a guideline most folk on here seem to be able to find a gents barber visit for £15 and a Womens cut for £30-ish - looks like your OH is about on that level but going far more often than he ought to need - perhaps time for a less high-maintenance style? You could try dropping a stylist level maybe - that sounds like "Senior Style Director" or similar level. 

Entertainment........................... 80 Does this cover all your entertainment?

Holiday................................. 0 You never go away at all - not even for a weekend visiting family?

Emergency fund.......................... 0[b] You definitely need to get something in here! 

Total monthly expenses.................. 3046.24[/b]

[b]

Assets[/b]

Cash.................................... 200

House value (Gross)..................... 217000

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

Car(s).................................. -4500

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

Total Assets............................ 212700[/b]

[b]

Secured & HP Debts[/b]

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

Mortgage...................... 165600...(675)......3.02

Hire Purchase (HP) debt ...... 20124....(385)......7<

Hire Purchase (sofa)...........998.14...(90.74)....0<

Hire Purchase 2nd car..........16000....(287)......7[b]

Total secured & HP debts...... 202722.1.-.........-   [/b]

[b]Unsecured Debts[/b]

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

Owed to parents................1100......0.........0[b]

Total unsecured debts..........1100......0.........-  [/b]

[b]

Monthly Budget Summary[/b]

Total monthly income.................... 3,545

Expenses (including HP & secured debts). 3,046.24

Available for debt repayments........... 498.76

Monthly UNsecured debt repayments....... 0[b]

Amount left after debt repayments....... 498.76[/b]

[b]Personal Balance Sheet Summary[/b]

Total assets (things you own)........... 212,700

Total HP & Secured debt................. -202,722.14

Total Unsecured debt.................... -1,100[b]

Net Assets.............................. 8,877.86[/b]

Please bear in mind however, that our income will drop by £890(ish) when I have to go on maternity leave later in the year.

Comments on the SOA in bold as usual...

Right then - the first thing to track down is that £500 a month you are showing as unallocated - that's nearly £6k a year you're just "losing" at the moment - in other words, enough to clear what is owed to your parents inside three months and then be able to start building a proper emergency fund too. Might be worth getting together a spending diary - literally a notebook and pen each where you write down EVERYTHING you spend over a month as that will see where money is being spent that's not currently being budgeted. 

Others have said about checking what benefits you may be due - this will definitely come into play later in the year I would think. 

The absolute blessing here is that you have asked for help BEFORE getting into serious debt - it's so much easier to deal with at this stage when you can really drill down into what you're spending, and also work to track down "leaking" money like your £500. 

If you're happy with your existing mobile providers then a good starting point is to ring them and tell them that, and then continue with "however I've seen this great deal from X offering this, that, and the other, and it's only £8 a month so I think I need to leave you - could I have a PAC code please?" and see what they say - most will match. If the offer you quote happens to be with another supplier using the same network they are even more likely to in my experience! 

On the TV license you need it if you are watching ANY TV "as live" I believe. If you only watch things like Netflix etc then you  may be able to get away without though. 

LBincoming

Grumpelstiltskin said:

You do need to go through everything with a fine toothcomb.

For instance how much do you spend on ready prepared baby food?

Do you buy ready prepared meals for yourself and your husband?

Do you know what time your supermarket has reduced offers?  Lidl is usually first thing in the morning.

Your husband needs to be 200% with you on this, I'm sure he doesn't need to go to the barbers every 2 weeks, he might want too but at the moment it's needs not want.


Edit     Have you discovered the Old Style board on here?

They have loads of money saving ideas.

No ready meals, no pre-prepared baby food (other than things like malted milk biscuits, which doesn’t even come to £1 a month). I cook almost everything for scratch, partly because we’re quite keen on eating healthy so I like to know what’s in our food and also because I love cooking.

I think it’s mainly our ‘extra spend’ that we don’t really need to be honest. I go out for coffees a lot as a way to catch up with friends and family - could just as easily go round theirs or have them come to me.

Thank you! I’ll have a look at that!