Debt advice 40k

EssexHebridean

The SOA looks far more accurate now - however you will notice how much of that £500 has been swallowed up simply by getting the basic budgeting in place! It never fails to amaze me how easily we underestimate our spending in some areas - and we've all been there on this too! 

Now - the stuff you are budgeting to put money aside for monthly needs separating out and ring-fencing at the beginning of the month each month - some folk use separate pots for (for example) car, holiday, general household expenses, emergency fund etc - others use a single savings pot but then keep a spreadsheet to keep a tally of what money is allocated where within that. I personally prefer keeping stuff separate with one exception which is my emergency fund - that sits in with general long term savings but we're fortunate to be in a position to work like that now after a lot of years of hard work.  Once you have sorted how best to ensure that is saved (remember that it needs to be in easy access, but have a look through your providers easy access options to get a decent interest rate, and for your emergency fund you could potentially look at a limited withdrawal account allowing say 6 withdrawals a year without penalty on interest as if your budget is working OK you won't be dipping into that regularly anyway) then set a standing order or orders for the day after payday to transfer the funds away from your current account so they are a) out of the way of temptation as "available money" and B ) into an account where they are earning you some interest. 

elsien

Yes I do that. I have a bill fund, a holiday fund, a car fund and a house maintenance fund (essential repairs for my old house.)

Some accounts let you set up pots within the main account but that doesn't work for me although it does cut down on the admin if you can get your head round it. 

Helloadviceplz

Ok thank you both. The SOA has definitely been a useful exercise. I guess once my partner is able to support more with costs this will increase my ability to save. I will share that he is likley not to go halves on my mortgage as he pays his own mortgage, however a general increase proportionate to his new income from May will be helpful. I guess its just figuring of what that will be. 

All in all, I assuming you think the right decision is to pay these debts as I am then? And you do not believe I need any support or additional help (I said no to the IVA). I guess having asked your advice I am seeking some reassurance that my SOA proves I can do this alone if I stick to a budget. My income may also increase mid way through the year slightly as I am doing well in my current role and salary will be reviewed against performance in June.

Thank you

Helloadviceplz

Helloadviceplz said:

Ok thank you both. The SOA has definitely been a useful exercise. I guess once my partner is able to support more with costs this will increase my ability to save. I will share that he is likley not to go halves on my mortgage as he pays his own mortgage, however a general increase proportionate to his new income from May will be helpful. I guess its just figuring of what that will be. 

All in all, I assuming you think the right decision is to pay these debts as I am then? And you do not believe I need any support or additional help (I said no to the IVA). I guess having asked your advice I am seeking some reassurance that my SOA proves I can do this alone if I stick to a budget. My income may also increase mid way through the year slightly as I am doing well in my current role and salary will be reviewed against performance in June.

Thank you

Its also so frustrating to realise how much better off I would be without these debts, i'd feel rich!!

RAS

It's quite important at the moment not to have your partner paying towards your mortgage, as that means they can claim if you split up. Can pay the rent however.

Helloadviceplz

RAS said:

It's quite important at the moment not to have your partner paying towards your mortgage, as that means they can claim if you split up. Can pay the rent however.

Yes we wont be paying on each others mortgage. Paying for the rent would be great! 

Helloadviceplz

any other advice? 

EssexHebridean

Stick to your new budget like glue.
Learn the phrase "Ah no I'm sorry, that's outside my budget for this month - can we pencil something in for XXX  instead?"
Resist the temptation to say "I can't afford that" - it makes you feel poor and encourages a "woe is me" mindset - channel "I'm choosing not to spend money in that area to improve my financial situation" instead.
Check your bank accounts regularly - learn what your balance looks like at certain times of the month - you will then be more quickly alerted if things go wrong.

Maybe consider starting a debt free diary on the diaries board - it can be a great way of getting support and keeping track of your progress.