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Help and Advice - Small Amount of Debt

edited 30 November -1 at 1:00AM in Debt-Free Wannabe
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  • enthusiasticsaverenthusiasticsaver Forumite, Board Guide
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    Early retired in December 2017

    I'm a Board Guide on the Debt-Free Wannabe, Mortgages and Endowments, Banking and Budgeting boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Pease remember, board guides don't read every post. If you spot an illegal or inappropriate post then please report it to [email protected]
  • enthusiasticsaverenthusiasticsaver Forumite, Board Guide
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    CashOut wrote: »


    Hopefully that’s then plan and also why I’m looking at it today when the total is sub £5000 and still “manageable” as I don’t want to be back here in 3-5 years with £30000-£50000 racked up as (no offence intended) some of the horror stories on this forum literally scare the !!!!!! out of me!

    You may consider the debt small and manageable but you will pay up to £1265 per year on interest on that £3800 if you do not make some inroads into paying it off. That is more than 2 years worth of your clothing budget just on debt interest.
    Early retired in December 2017

    I'm a Board Guide on the Debt-Free Wannabe, Mortgages and Endowments, Banking and Budgeting boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Pease remember, board guides don't read every post. If you spot an illegal or inappropriate post then please report it to [email protected]
  • edited 11 July 2019 at 9:10PM
    getmore4lessgetmore4less Forumite
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    edited 11 July 2019 at 9:10PM
    Change your provider if the best they can do is £13.

    Plenty of contract with plenty of data for less than that and unlimited calls/text.

    https://www.hotukdeals.com/tag/broadband-phone-service


    Mileage you need to guess for the year it offsets your running costs.

    You may be subsidising the company by using your own car.
  • zippygeorgeandbenzippygeorgeandben Forumite
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    I'm really struggling to understand how someone thinks £130 is a good deal for a phone? It's astronomical. Like Dan says, is this for more than one contract?
    Also £75 per month for entertainment, what do you get for this? Concerning that you had debts from 2014 and don't seem to have learnt the lesson of living within your means. You're fortunate to have such a small monthly rent bill.
    Changes need to be made!
    Savings as of July 2020
    Savings account 1 - £15597.36(14081.15)Savings account 2 - £5000(4500.00)
    Current account - £2015.64(4116.53)
    Total - £22613.00 (22697.68)
    Plus £840 (£120 per month between CS/BS) HTB £800
  • getmore4lessgetmore4less Forumite
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    If you don't want to guess the mileage payments then change the fuel to only the personal miles.

    The work miles get paid by the allowance.
  • getmore4lessgetmore4less Forumite
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    Two work suits a year?

    You don't get paid enough if the job need 2 expense suits a year make them last longer.

    Look for stuff in the big sales periods and stock up in advance when stuff is cheap

    Next is expensive even in the sales.

    Try house of frazer or John Lewis sales current 50% they go 75% if lucky they will still have your sizes.
    https://www.johnlewis.com/browse/men/all-mens-suits/all-offers/_/N-7dnqZ1yzvw1q?intcmp=cp_menswearoffers_smbl5_suitsoffers_x200619

    See if you can downgrade your current mobile contract to a lower tariff.

    If you need more then one of the cheap ones may still be cheaper on top.

    Must be a seriously good phone on a £130pm contract.

    When this one breaks £100-£150 buys a good phone good for a few years add £10pm sim £200py against over £1,500py
  • CashOutCashOut Forumite
    5 posts
    As others have said the clothes, mobile costs, presents and groceries are high and entertainment can be brought down. Depends on how hard core you want to be on clearing the debt but you are paying very high interest rates so my advice would be cut back to bare bones for a year.

    On that Aqua debt for example you are only paying £80 a month and the monthly interest is almost £73 so only around £7 a month is going to reduce the balance. It will never be paid off at that rate. That should be the one you focus on first as it is the highest interest rate and the highest balance so your most expensive debt. The Capital one is better at only £32.50 interest per month so that is going down faster. I would reduce the payment on that one to minimum and direct it to the Aqua until it is gone.
    If you input those figures into a snowball calculator you will see that it will take you more than 3 years to clear the debts and cost you over £2200 in interest. If you can increase the monthly payment to £200 and pay £40 to Capital One (assuming that is higher than the minimum) and £160 to Aqua you will be debt free in just over 2 years and pay just over £1000 in interest assuming you do not get a 0% deal in those 2 years.
    You may consider the debt small and manageable but you will pay up to £1265 per year on interest on that £3800 if you do not make some inroads into paying it off. That is more than 2 years worth of your clothing budget just on debt interest.

    Ideally I’d like to be clear in a year or less, but I think that’s a little optimistic and most likely unrealistic. I’ll take a look at shuffling the payments around so I can clear down the higher interest card first and then focus on the lesser one. I doubt I’ll get a 0% deal so unfortunately I’ll be stuck on the higher interest rates for the duration.
    Mrsn wrote: »
    Groceries is totally doable on much less. I spend £220 a month for 2 adults, 2 children, small dog and this includes toiletries. We very rarely eat the same meal more than once a month and utilise the leftovers.

    Clothing allowance whilst might not seem much to you a new winter coat of that price is a luxury not a necessity.... you can get one for a 3rd of that price from the likes of primark or supermarket brands. I appreciate it’s different to what your used to but for a temporary measure it’s not unreasonable.

    How do you manage to spend so little on groceries? If we were talking exclusively food at £200 that’s only £1.66 per meal, if you add coffee, washing powder, toiletries etc etc for the month it’s going to be considerably less.

    I’ll take a look at Primark and Supermarket brands for coats, tbh I’d never seen overcoats in Esther but it’s possible that I’ve just never noticed them. How good quality are these clothes when it comes to the other main items I buy (work jackets / trousers / shirts) as I usually buy one lot from Next and they manage to keep me for the entire year (suits x 2 = £200 / extra trousers x 2 = £70 / shirts £90 / shoe maintenance £50).
    Try this linkl]

    Thanks, I’ll take a look at it now :)
    Change your provider if the best they can do is £13.

    Plenty of contract with plenty of data for less than that and unlimited calls/text.

    Mileage you need to guess for the year it offsets your running costs.

    You may be subsidising the company by using your own car.

    I don’t know if it’s “the best they can do”, but it’s their lowest advertised price on their website (provider is EE). Tried to follow that link but my ad-blocker shows it as “spam / advertising” - once on the website I can’t decipher what’s going on, the first “deal” is £360, maybe I need to spend some more time on it but the website looks rather tacky and confusing.

    Like I said, it’s rather hard to guess it, I can go weeks with little to no travel and then get a phone call and have the next three weeks racking up 100 miles a day, that’s why I don’t factor it in as it’s not a reliable source and it’s easier to work out things excluding it.

    I’m not sure what you mean (I guess everyone who drives to work is subsidising their employer as they are taking the hit on travel costs?). I live in the same town as “my office” but a requirement of my role is to travel to multiple locations when required. Fortunately because I live where I work I get true mileage for all of my travel at a rate of 0.45p per mile and my employer have purchased county council parking permits for each city I frequent so I never have any parking charges.
    I'm really struggling to understand how someone thinks £130 is a good deal for a phone? It's astronomical. Like Dan says, is this for more than one contract?
    Also £75 per month for entertainment, what do you get for this? Concerning that you had debts from 2014 and don't seem to have learnt the lesson of living within your means. You're fortunate to have such a small monthly rent bill.
    Changes need to be made!

    Who said £130 was a “good deal”... looks back through thread, can’t see anyone claiming that, honestly I know it’s a terrible deal and I don’t utilise the annual upgrade option so I’ll be glad once I’m finished with it this November (the original package was a phone, watch and headphones which I agreed to almost two years ago and I’ve regretted it for at least the last year after encountering employment / relationship problems resulting in my current financial difficulties).

    The £75 covers my gym membership (£35), online game subscription service (£9) and the remaining £31 covers my monthly “pub n’ grub” night out with friends.

    I’m not sure what you mean by “concerning that you had debts from 2014 and don’t seem to have learnt the lesson of living within your means” the defaults resulted from a disagreement over payments owed with one particular lender that I had three individual accounts with (top and bottom I withheld payment because I believed I was in the right and they were in the wrong, advice later is that I should have made payments and not withheld them while we argued over the terms).

    Yeah that’s one bonus, the place is tiny (bedroom / bathroom / kitchen-living-diner), it’s in a high-crime area where you wouldn’t walk around during the day (never mind at night) but it’s enough for one person and includes parking bays for residents.

    Yes I realise, you don’t need to be all exclamation marks about it... it wouldn’t be here if I wasn’t looking to facilitate change to better my financial situation for the better.
  • theoreticatheoretica Forumite
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    CashOut wrote: »
    I’ll take a look at the clothing, tbh I’d always thought £600 a year was reasonable as it really doesn’t go far, winter coat, two new work suits with additional trousers, two packs of shirts and shoe repairs each September would be around that alone. I’ve never heard of TK before, almost all my work stuff comes from Next, not really sure where else you would buy stuff like that tbh...? As for casual stuff I mainly pickup basics at Primark these days.


    It isn't so much a question of what is reasonable in the abstract as what is possible to cut down and when you consider your debts are a better use for the money. I buy a lot second hand, it can take longer finding the right thing in the right size and condition but was an excellent way of dressing above my means as a student and I continued.
    But a banker, engaged at enormous expense,
    Had the whole of their cash in his care.
    Lewis Carroll
  • CashOutCashOut Forumite
    5 posts
    If you don't want to guess the mileage payments then change the fuel to only the personal miles.

    The work miles get paid by the allowance.

    Fuel is only personal miles, work isn’t factored in.
    Two work suits a year?

    You don't get paid enough if the job need 2 expense suits a year make them last longer.

    Look for stuff in the big sales periods and stock up in advance when stuff is cheap

    Next is expensive even in the sales.

    Try house of frazer or John Lewis sales current 50% they go 75% if lucky they will still have your sizes.

    See if you can downgrade your current mobile contract to a lower tariff.

    If you need more then one of the cheap ones may still be cheaper on top.

    Must be a seriously good phone on a £130pm contract.

    When this one breaks £100-£150 buys a good phone good for a few years add £10pm sim £200py against over £1,500py

    :O expensive suits? I buy the cheapest ones at £99 lol!? Not sure what you mean... salary doesn’t dictate presentation, I know lots of other “young professionals” also only earning around the £30k mark who all are expected to wear suits for work... with regular washing the trousers and shirts are about ready to throw away after a year of daily wearing, next to the jackets they are paired with they look considerably faded and deteriorated. Isn’t John Lewis designer (Armani / Hugo Boss, where suits start at £400?), I’ll take a look at their website after I reply to this post.

    Yes I can down-grade my contract, it’s £650 to break contract and pay the remaining balance, I have enough free credit on either credit card to accommodate this so will look at doing it now. The contract was for an iPhone X, Apple Watch and EarPods, in hindsight this was a little silly of me to agree to but at the time money wasn’t like it is 18 months later, fortunately I didn’t take my annual upgrade so it only has 5 months remaining which I’ll look to pay off now as advised. The phone I’ve got is still in “mint” condition so I will just add a SIM contract to is and save over £100 a month.
  • getmore4lessgetmore4less Forumite
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    £150 for person fuel when you live near work so low commute cost is a lot of miles.
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