140k Unsecured debt - advice

iza_belle1

Is there any scope for changing the car? At the beginning of our money saving journey we switched to a small Hyundai, one year old, 5 year warranty.  It's definitely not an exciting car but is very cheap to run, insure, tax etc. And fits a family of four plus a buggy. I don't know if you're tied into a HP deal but just a suggestion. 

Bluebell1000

If either of your employers offer a salary sacrifice car scheme, you could look at electric car options through that as another alternative.

zedonk

My advice with groceries would be to keep all your receipts/delivery emails for a few weeks so you can analyse where your money's going. (Especially if you've tried/are already doing the obvious stuff like budget supermarkets and cooking from scratch.) Once you know what's costing you the most money, you can target it specifically. E.g. if it's meat/fish, can you buy cheaper cuts or plan more vegetarian meals? If it's nappies and formula, are you checking prices and going wherever's cheapest, and have you tried switching down a brand? Are you popping to a corner shop for top-ups and spending over the odds there? There's likely to be something you can change.

DrEskimo

iza_belle1 said:

Is there any scope for changing the car? At the beginning of our money saving journey we switched to a small Hyundai, one year old, 5 year warranty.  It's definitely not an exciting car but is very cheap to run, insure, tax etc. And fits a family of four plus a buggy. I don't know if you're tied into a HP deal but just a suggestion. 

I was thinking the same. There is no worries about being locked in to a finance deal. Can settle the finance and trade or sell the car when ever the OP likes.

According to the SOA, the car has a value of £16,500 and the outstanding HP finance is just £8,500. So could trade/sell, then use a portion of the £8,000 left over to buy a cheaper car, with the rest (along with some of the £8,000 cash, leaving at least £1,000 for emergency fund) to clear off the highest interest debts. 

Savings from HP finance, cleared debts with surplus money, along with savings in insurance, tax and maintenance, the OP could save a significant amount per month. to start getting the budget into the black.

Agree that food shop is a big area to bring down too. Easily shave a few hundred off that.

OP are you confident the SOA is a fair reflection of your average spend month to month? There are a lot of rounded numbers and whilst the debt repayments don't leave you with any surplus, it's important to know if the SOA is accurate as you need to know where the spending habits need to be curtailed.

As above, going over the last 6-12months of expenses in both your food shopping, but also all other spending is a must before you can start to make a realistic budget. 

LoulaBelle

Do you actually need a 4 bedroom house?

ldn83

Thanks again for all the input guys, some really good stuff there, we definitely have room to improve in terms of spending less on areas like groceries which we’ll look at properly soon. Problem we have is that my wife doesn’t drive and I’m often away with work on the weekends so getting to the discount stores is tricky so she just orders things for delivery. You’ll be surprised on how much the nectar card takes off the total cost at the moment, lots of promotions on now matching the discounters. We got around £35 off our Xmas shop with the nectar price promotions. Also inflation is projected to come right down this year and hopefully so will our food bill. 

Regarding the car, I should be getting a company van in a few months time which will take down the annual mileage massively off our car so upkeep costs should come right down as well as fuel bill. Also we got a very low apr finance on it and payments relatively low and 50% is paid already. We have a big SUV because we need it for all the family stuff whilst travelling and also it’s been useful for transporting materials and dump runs during the refurb.

barbarawright

With a four bedroom house, could you get a lodger?

ldn83

barbarawright said:

With a four bedroom house, could you get a lodger?

The last bedroom is being done right now. It’s the last room to finish. We were thinking about a live in nanny to occupy that room, my wife doesn’t like the idea of someone living with us full time though so it’s off the cards for now.

RAS

It doesn't have to be full-time.

Given your sort of house and location, it could be a few days a week for someone who needs to be in London but lives elsewhere. Or a professional on a short-term contract looking for anything that's not AirB&B or a hotel. And if you get the contract right you can terminate at a week's notice.

Bluebell1000

ldn83 said:

. Also inflation is projected to come right down this year and hopefully so will our food bill. 

I felt I should mention that falling inflation only means that bills are going up more slowly. It doesn't mean that food bills will fall, unless inflation actually goes negative, so you can't rely on that to save some money. If you want to balance your income and outgoings you need to make some real changes now, rather than hoping that things will be okay because of things that might be different in a while. 

I agree with the poster above about how useful it is to meal plan! We try to batch cook and freeze portions to reheat for busier days, so it reduces waste too. 

We do our supermarket shop on a Friday evening. There's often some good discounts, and it's nice and quiet, supermarket shopping doesn't have to be a weekend activity.