SOA budget advice

RobM99 · 13 December 2022 at 10:06AM

TheAble said:

RobM99 said:

£80 - mobiles? Holidays £215? With the above post, I can see where the problems lie!

£215/month for holidays isn't that egregious. What is that nowadays, one week in Spain? I can sympathise with this one as I generally have to stump up similarly myself.

When someone's sinking in a sea of debt, I wouldn't consider it essential by a long chalk.
As foxgloves says - "it's someone else's money" and that's just a highlight from their post.

The OP is hitting themselves over the had with a baseball bat then taking paracetamol. Well, stop doing it. Spent the money, had fun. Now it's payback time. Living in denial is not the answer.

OP - you must act, not ask for help then 'justify' why you can't do what the whole board advises.

RAS · 13 December 2022 at 10:17AM

It comes down to: Do you want a roof over your head or a holiday in Lapland?

You earn decent salaries but spent recklessly. Now it's pay back time.

In whose names are debts? And as asked elsewhere, you need to add the credit cards as well.

You might want to take a short break from the overtime, but you really need it and some massive cuts in your living costs. Maybe look at taking a holiday from overtime every couple of months.

TheAble · 13 December 2022 at 10:27AM

RobM99 said:

TheAble said:

RobM99 said:

£80 - mobiles? Holidays £215? With the above post, I can see where the problems lie!

£215/month for holidays isn't that egregious. What is that nowadays, one week in Spain? I can sympathise with this one as I generally have to stump up similarly myself.

When someone's sinking in a sea of debt, I wouldn't consider it essential by a long chalk.

Well holidays are never really essential, and I agree it's something that has to wait until you've paid your debts back. But I guess my point was that, but for the debts, £215/month for holidays isn't exactly unreasonable as part of an overall budget.

Of more interest are the gym memberships and protein supplements which really are a waste. And the OP definitely has a car problem, when you look at how much those are burning up every month.

Ebe_Scrooge · 13 December 2022 at 10:31AM

snowdrop33 said:

Household Information[/b]
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 2[b]

Monthly Income Details[/b]
Monthly income after tax................ 3119
Partners monthly income after tax....... 2100
Benefits................................ 157
Other income............................ 0[b]
Total monthly income.................... 5376[/b][b]

Monthly Expense Details[/b]
Mortgage................................ 1052
Secured/HP loan repayments.............. 514
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 232
Electricity............................. 150
Gas..................................... 0 Is this correct - I'm assuming you're all-electric?
Oil..................................... 0
Water rates............................. 50
Telephone (land line)................... 0
Mobile phone............................ 82 This could be reduced somewhat, unless you're tied into contracts
TV Licence.............................. 14
Satellite/Cable TV...................... 20
Internet Services....................... 32
Groceries etc. ......................... 833 This is very high - you could likely halve this by shopping at Lidl/Aldi
Clothing................................ 60 Can this be reduced? Appreciate you've got kids to clothe, but is there any wiggle-room here?
Petrol/diesel........................... 250
Road tax................................ 92 Each month? Sounds extremely high
Car Insurance........................... 93 Sounds a lot - can you shop around?
Car maintenance (including MOT)......... 130
Car parking............................. 5
Other travel............................ 0
Childcare/nursery....................... 606
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 7.5
Pet insurance/vet bills................. 31
Buildings insurance..................... 11
Contents insurance...................... 0 No contents insurance?
Life assurance ......................... 19
Other insurance......................... 0
Presents (birthday, christmas etc)...... 50
Haircuts................................ 60 You can reduce this
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 50
Child support - husband has older daught 125
Supplements-protein, vitamins .......... 60 Are these necessary?
Date nights and takeaways............... 100 Each month? This can be stopped, or at least cut dramatically
Me and husband sport comp............... 30
Family days out......................... 60 This is a lot if you're wanting to make savings
Children gymnastics..................... 40
House fund - painting/furniture......... 25
Children fund........................... 25
Holiday fund............................ 215
Gym memberships......................... 72 Can this be cut?
Professional fees....................... 27
Spotify................................. 13.99 Do you really need this?
Tesco delivery saver.................... 7.99
Breakdown............................... 13[b]
Total monthly expenses.................. 5257.48[/b]
[b]

Assets[/b]
Cash.................................... 0
House value (Gross)..................... 475000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0[b]
Total Assets............................ 475000[/b]
[b]

Secured & HP Debts[/b]
Description....................Debt......Monthly...APR
Mortgage...................... 297000...(1052).....0
Hire Purchase (HP) debt ...... 15000....(204)......0<
HP.............................24000....(310)......0[b]
Total secured & HP debts...... 336000....-.........- [/b]

[b]Unsecured Debts[/b]
Description....................Debt......Monthly...APR
Novuna - sofas.................208.......52........0
Barclays loan..................27000.....647.......5.4
Barclays loan..................9300......212.......3.8[b]
Total unsecured debts..........36508.....911.......- [/b]

[b]
Monthly Budget Summary[/b]
Total monthly income.................... 5,376
Expenses (including HP & secured debts). 5,257.48
Available for debt repayments........... 118.52
Monthly UNsecured debt repayments....... 911[b]
Amount short for making debt repayments. -792.48[/b]

[b]Personal Balance Sheet Summary[/b]
Total assets (things you own)........... 475,000
Total HP & Secured debt................. -336,000
Total Unsecured debt.................... -36,508[b]
Net Assets.............................. 102,492[/b]

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

My thoughts in bold above.

Singlespeeder · 13 December 2022 at 10:48AM

Morning.
I don't often comment but do enjoy watching other peoples Light Bulb Moments, having been there myself at nearly £50k of various debt.

I'm impressed with your stoicism.

It doesn't feel like you've really got your head around just how much debt you've got. The other post swishes in with oh I've got a bit of debt and 10.5k to clear it with .... completely ignoring the the rest of the mountain / nay avalanche
This one gives a clearer picture ... but ignores the Credit card debt.

Barclays loan..................27000.....647.......5.4

barclays loan 5.4% balance £30500 payments £646 a month so about 4 years left

Presumably these two are the same (though different) if so .... we'll remove the mortgage as to me that's acceptable (though significant)

Secured & HP Debts[/b]

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

Hire Purchase (HP) debt ...... 15000....(204)......0<

HP.............................24000....(310)......0[b]

Total secured & HP debts...... 336000....-.........- [/b]

£39,000 Secured

[b]Unsecured Debts[/b]

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

Novuna - sofas.................208.......52........0

barclays loan 5.4% balance £30500 payments £646 a month so about 4 years left

mbna credit card 0% £985

barclays credit card 0% £3995

Barclays loan..................9300......212.......3.8[b]

Total unsecured debts..........44988.. [/b]

You've got just shy of £84,000 of debt. Possibly slightly less if the Barclays loan is 27k not 30K
And that's not counting the nearly £300,000 of mortgage. How long have you got on your fixed rate on that?

Forget Lapland.
Forget £1000 a month on food
£60 on supplements?
£50 Emergency Fund but no Emergency Fund...

EDIT** Ebe_Scrooge has done a better job that me ...

You can't live like you're living.

I hope the LBM hit's soon. When it does, at least you have a reasonable income and plenty of wriggle room.

EssexHebridean · 13 December 2022 at 11:35AM

[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.................... 2[b]

Monthly Income Details[/b]
Monthly income after tax................ 3119
Partners monthly income after tax....... 2100
Benefits................................ 157 Not sure what this is but if Child Benefit have you checked whether you will need to repay it?
Other income............................ 0[b]
Total monthly income.................... 5376[/b][b]

Monthly Expense Details[/b]
Mortgage................................ 1052 Make sure you are very aware of when your deal ends assuming you are on a fix - as your payments are going to increase at that stage.
Secured/HP loan repayments.............. 514
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 232
Electricity............................. 150 Have you checked this is accurate? Both the mortgage and the C Tax suggest a large property and this seems a little low to cover all heating, cooking etc. Ignore "what your direct debit is set at" and check your annual use and work out costs from there.
Gas..................................... 0
Oil..................................... 0
Water rates............................. 50
Telephone (land line)................... 0
Mobile phone............................ 82 This is very high - diarise when contracts end, keep your existing phones and switch to sub £10 a month SIM only plans.
TV Licence.............................. 14
Satellite/Cable TV...................... 20
Internet Services....................... 32 This is expensive - shop around for better deals when the contract ends.
Groceries etc. ......................... 833 Already mentioned but this is extraordinarily high. The Old Style board and the Grocery Challenge could help provide some inspiration. To give you a clue, I feed two grown adults without feeling constrained in the least on around £220 a month. That's probably a bit hardcore for you in the first instance, but you can work towards knocking off a chunk a month for a few months and see where your comfort point lies. See below for a little challenge around this.
Clothing................................ 60 This is pretty high allowing that with the debt you have, you and hubby should be only buying bare essentials at the moment. For smaller children, charity shops and eBay can be good resources.
Petrol/diesel........................... 250
Road tax................................ 92 Ouch. Already covered by others I believe.
Car Insurance........................... 93 Also ouch - why so high? Any prospect of this reducing - do you have any claims ready to drop off, for example?
Car maintenance (including MOT)......... 130 You MUST make sure you set this aside each month. I would open a specific savings account for the purpose.
Car parking............................. 5
Other travel............................ 0
Childcare/nursery....................... 606
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 7.5
Pet insurance/vet bills................. 31
Buildings insurance..................... 11
Contents insurance...................... 0 There shouldn't be a zero here!
Life assurance ......................... 19
Other insurance......................... 0
Presents (birthday, christmas etc)...... 50 Make sure this is realistic, and you must make sure you really do put it aside each month going forwards.
Haircuts................................ 60 This is high.
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 50
Child support - husband has older daught 125
Supplements-protein, vitamins .......... 60 I'm going to suggest you do some reading on whether the supplements really do what they are hyped to do. there are a lot of supplements recommended to sporty people that either have low efficacy because of the way they behave in the body, or that can be got from a healthy balanced diet. worth investigating with an open mind as this is over £700 a year that could be better used elsewhere.
Date nights and takeaways............... 100
Me and husband sport comp............... 30
Family days out......................... 60
Children gymnastics..................... 40
House fund - painting/furniture......... 25
Children fund........................... 25
Holiday fund............................ 215 I agree with others that with the debt you have, this is too high currently. Centreparcs has to be paid by the sound of it, but I think you need to put other "big" holiday plans on the back burner for a few years and get shot of the worst of the debt.
Gym memberships......................... 72
Professional fees....................... 27
Spotify................................. 13.99
Tesco delivery saver.................... 7.99
Breakdown............................... 13[b]
Total monthly expenses.................. 5257.48[/b]
[b]

Assets[/b]
Cash.................................... 0
House value (Gross)..................... 475000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0[b]
Total Assets............................ 475000[/b]
[b]

Secured & HP Debts[/b]
Description....................Debt......Monthly...APR
Mortgage...................... 297000...(1052).....0
Hire Purchase (HP) debt ...... 15000....(204)......0<
HP.............................24000....(310)......0[b]
Total secured & HP debts...... 336000....-.........- [/b]

[b]Unsecured Debts[/b]
Description....................Debt......Monthly...APR
Novuna - sofas.................208.......52........0
Barclays loan..................27000.....647.......5.4
Barclays loan..................9300......212.......3.8[b]
Total unsecured debts..........36508.....911.......- [/b]

[b]
Monthly Budget Summary[/b]
Total monthly income.................... 5,376
Expenses (including HP & secured debts). 5,257.48
Available for debt repayments........... 118.52
Monthly UNsecured debt repayments....... 911[b]
Amount short for making debt repayments. -792.48[/b] There you go - THAT is how much you need to trim from this to make your budget work.

[b]Personal Balance Sheet Summary[/b]
Total assets (things you own)........... 475,000
Total HP & Secured debt................. -336,000
Total Unsecured debt.................... -36,508[b]
Net Assets.............................. 102,492[/b]

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

Comments on the SOA above in bold as usual.

I'm also going to remind some respondents here of DFW's "No Judgement" basis - constructive comments are good, but there are some posts here that aren't really providing that so much as simply laying blame on the OP. No helpful, and worse, inclined to frighten people away which is really not what we want!

OP - I'm going to issue you with a challenge. Never mind the money you're being given - I want you to reduce your grocery spend enough this month that you can clear the remining sofa loan with what you've saved on it. First step here is to inventory your fridge, freezer and cupboards, then write a meal plan around the things you already have in. Write out as many meals as you can - not against specific day at the start, just a list of meals. As you reach the point where you are at "well I could make a chicken stew but I'll need to buy carrots" - write "carrots" on the shopping list. Think about the small additions you can make to your stores to make the food you have stretch even further. (So if you have peppers, tomatoes, bacon & mushrooms it might be worth buying eggs to make omelettes one night for example). If you buy pre prepared pasta sauces and similar, then making from scratch (perhaps by batch cooking and freezing extra portions) is a great way of reducing costs.

Without including the TV license - had you realised that your spend on "entertainment" totals just under £4000 a year? I think you need to take some tough decisions and see where some of that can be cut back I'm afraid. Have you checked whether there are better deals locally for gym membership for example? Personally I'd say the £100 for takeaways needs to go as well - if you can save enough from your monthly grocery budget to afford a takeaway from it, and that is how you choose to use that money, grand - if not, then best to go without and "fakeaway" at home instead.

Further suggestion on the shopping - start shopping in store - then you have to physically pick things up and put them in the trolley - and you'll see how much you're buying in a far more "solid" way than shopping online.

With the money, I'd be setting aside £2k for that emergency fund - that is ONLY to be touched in a genuine emergency - NOT because someone needs new school shoes and you forgot to budget for them, or because the car needs a service and you haven't been setting money aside for that, or because it's dark and cold and everyone's tired and ordering a takeaway is soooo much easier than throwing some pasta in a pan... (these are real examples of occasions on here that I have seen people saying they will "just use the EF" by the way!). Then I'd use the balance to clear most of the smaller Barclays loan. The sofa will already be paid if you decide to take my thrown down gauntlet above, of course.

Add the £52 saved there to get the remaining balance on the smaller loan cleared sooner, then start working on the bigger loan.

The main thing though is to balance the books and trim the lifestyle I'm afraid. You can't "have it all" - from now on, you can only have what you can afford.

Sncjw · 13 December 2022 at 3:05PM

Could you cut out the date nights if you did that for 2 months that's the sofa paid off and after that is an extra 100 a month to the debt. Maybe you could pay off the smaller Barclays loan with the 10k. Then all's the money you pay to those debts tackle the larger loan. Cut down on groceries too. Meal plan so you buy what you actually need and maybe cut out any processed foods and batch cook on your days off so that you have meals ready for the busy days.

What's the benefits for?

Cut out the holidays and use that money to the debt. The quicker you pay off the debt the more you have in the future for holidays.

You say nappies and wipes but you say your child is 3 but not how old your husband's child..if they are.older than three could you potty train the 3 year old to save costs there..

Makingabobor2 · 13 December 2022 at 3:32PM

Well, I don't often post on threads asking for advice, but having been in the situation myself, £57K debt 7 years ago....and we didn't have a family to worry about, I have to agree with what most people have said
Scrap the holiday plans, maybe a cheap UK caravan in a couple of years, but certainly not saving for Lapland or Center Parcs
Cut down on the grocery spend...start meal planning & batch baking/cooking
Cut out the date nights and takeaways, the gym membership and the vitamin supplements
Get the cost of haircuts down.
Get the cost of clothing allowance down. I'm afraid once you are in debt its the time to start making things last, looking on freebie pages on FB and using charity shops.
Get cheaper mobile packages.

Good luck

LoulaBelle · 13 December 2022 at 4:10PM

Hiya,

I read on your other post that your mortgage is coming to an end in a few months' time and will be going up by £500 - I'm not sure if the others, that have said where you can make cutbacks have seen that - I'd heed their advice, these guys talk a lot of sense. Wishing you all the best, it can be done, I've been there, done that and got the T shirt !!!

fatbelly · 13 December 2022 at 4:25PM

On a rough count you're spending £1100 a month on two cars and you have no equity in either of them.

The aim is to get to the point where you have two cars (maybe just one) that you own and that are not worth very much and therefore not depreciating, and that don't cost high amounts in road tax, insurance, fuel and maintenance.

I don't know where you are with your HP agreements, whether there are balloon payments at the end (maybe that lump sum could be used) or whether you might be best to just do voluntary terminations and use the lump sum to buy a sensible car.

But I think you need to plan a route from 'here' to 'there.'

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