Big debts - ever seen anything like this?

southernscouser

Hi slickster. And welcome to the site.

Whatever you do, don't take any of the comments personally. It might feel people are being a bit savage and unsensitive, but I promise you we're not. We just know where you can make cutbacks and are trying to get the point across.

Currently you have a monthly defecit of £2,669. So you have to do EVERYTHING you possibly can to reduce this amount. What sort of income is the business making? Can you add that to your total incomings?

Cigarettes. I'm not gonna pretend to know what it's like to give up, but I do know that you can't afford it. How many do you smoke a day? Can you start by putting the money in a jar to see the savings you're making? You can also get free help to quit smoking from your GP.

Shopping. You honestly can shave at least £300 off your shopping board. I can't tell you how, but the Oldstyle board can!

If you can reduce the shopping and quit smoking thats already £430 saved. That brings the defecit down to £2,239.

I know it sounds nosey but we really need to know what the business is bringing in. :undecided

**ZAPPER**

Hi there

Do you know how you owe on each of the following, and what the apr is of each??

Egg loan 151
Barclay Loan 139
Capital 1 270
Smile 158
IF card 114
Mint 20
Tesco card 20
Barclay Card 50
Store cards 186

Regards.

southernscouser

Gonna be a right pain in the @rse here now! :rotfl:

With all your debts can you list balances, APR's, minimum payments, and with loans/hire purchases when you took the loan out and how long left to go?

Tiglet

Just a small point: you listed £19 for mortgage payment protection. If this covers you for unemployment them you've probably been mis-sold it, so you should be able to reclaim it. There's an article about it here.

slickster77

Don't worry about being harsh - I came here for your input! Will certainly start online food shopping and meal planning if I can make good savings.

The business is now in its third year and is on target to make probably about 25k year ending 31.3.08, and has the potential to do a whole lot more - its a risk I took knowing we already had debt problems as it was relatively cheap to set up and could bring in a great income. The other earnings I put down are for a p/t job I do the rest of the week to keep some regular cash coming in. My accountant says I can legally 'borrow' up to 30k per year from the business (ltd company) without losing tax creds etc, although tbh in the business there are obviously cash flow problems from time to time and with recently moving house and xmas I've taken too much out instead of paying the suppliers which has led to this shortage of money. The business itself is going well, but obviously I don't want to jeopardise its growth by contantly taking loads out to cover credit card bills etc, and when we look at our debt mountain its a bit disheartening!

Gemmzie

You should be drawing a wage from the company/business though. It depends what kind of business it is, but things like five sevenths of petrol, electric etc can be covered if you work from home by the business.

southernscouser

slickster77 wrote: »

Don't worry about being harsh - I came here for your input! Will certainly start online food shopping and meal planning if I can make good savings.

The business is now in its third year and is on target to make probably about 25k year ending 31.3.08, and has the potential to do a whole lot more - its a risk I took knowing we already had debt problems as it was relatively cheap to set up and could bring in a great income. The other earnings I put down are for a p/t job I do the rest of the week to keep some regular cash coming in. My accountant says I can legally 'borrow' up to 30k per year from the business (ltd company) without losing tax creds etc, although tbh in the business there are obviously cash flow problems from time to time and with recently moving house and xmas I've taken too much out instead of paying the suppliers which has led to this shortage of money. The business itself is going well, but obviously I don't want to jeopardise its growth by contantly taking loads out to cover credit card bills etc, and when we look at our debt mountain its a bit disheartening!

I know nothing about running a business so I don't want to sound condescending or whatever the word is but make sure you have money for suppliers and the taxman!

Could you but an estimate on a safe and realistic income from the business per month without jeopardising it? :think:

slickster77

Egg loan 151 - total 9500, 8ish yrs to go, apr c7.9%
Barclay Loan 139 - total 6000, 5 yrs to go, apr not sure - wife took it out
Capital 1 270 - total c9000, apr c15%
Smile 158 - total c7600, apr c 12%
IF card 114 - total c 5200, apr c17%
Mint 20 - total c1000, apr c16%
Tesco card 20 - total 1000, apr c16%
Barclay Card 50 - total c1500, apr probs high - this is Mrs' card
Store cards 186 - not sure of total - Mrs again... apr probably nrly 30%

Min payments are the payments I make each month in budget.

fc123

slickster77 wrote: »

First post, so hi everybody!



We’ve been getting by by taking money out of the business (which is growing well) to cover the shortfall, but in doing so have fallen a bit behind with our suppliers, so now have to focus all the money in the business towards that for the foreseeable future.

Below is a summary of our situation:

Monthly Incomings (not including income from the business):

Earnings: £760
Tax Creds: £600
Child Ben:£168
Other income:£130

Total = 1658

Monthly Outgoings:

Mortgage 1065
Payments to mum 500
Council Tax 126
Water 30
Gas 30
Elec 30
TV Licence 11
BT 10.50
Virgin 19.99
My mobile 15
Ptr’s mobile 35
Sky 19
Egg loan 151
Barclay Loan 139
Capital 1 270
Smile 158
IF card 114
Mint 20
Tesco card 20
Barclay Card 50
Store cards 186
Life insurance 34
Mortgage payment protection 19
Car insurance 25
Contents ins 7
Buildings ins 15
Bank charge 11.50
Denplan 22
Optician 7.50
Lotto 12
Bensons Beds 45
Supermarket 600
Sundries 50
Cigs 130
Booze 20
Presents 50
Swimming lessons 40
Petrol 240

Total = £4327! !!!!!



Other debts include loans of £15,500, (not inc student loans) and credit cards of £24,500ish. We also have a combined overdraft of £3,800 which unsurprisingly we live in!

Hi, we are S/E too and are now early 40's. Developed business and had kids through our 20's. I read your SOA and feel the stress.

We came to a crunch point 3 yrs back (after many good yrs) and I decided to
do our budget in a different way.
As S/E, sometimes one tends to take out what is needed rather than allocate oneself a fixed salary. The problem with this is it kills the cashflow for the business plus gives one a sense of false security...there is always a few quid available for whatever.

If suppliers aren't paid, they won't supply you and the business is over. Sorry that sounds harsh ...was just meant to be factual.

Please don't take this the wrong way..I'm just commenting from experience but if the business is doing that well, how have the debts piled up?

I now do our expenses Annually (not monthly) ; personal and all business (basing the stock figure on projected T/O). It really helps to see everything more clearly.

To carry on as you are you need profits (after taxes ) of £2669 pm every month of the yr.
When the busy months are happening, it is easy to forget the slow ones.


I'm not good at looking at others SOA's, but I can see a lot of expenditure that can go.

Sorry can't be of more help.;)

slickster77

Will look into reclaiming MPP cheers, as for the business- works from separate office (not at home), put through mileage allowance for tax purposes (accountant said better to do this than individual receipts). At the moment could realistically take £1,000 per month from business for the next 3 months, then hopefully more after April