early 40s and not fabulous at all

Hi Plush

I totally agree about the school photo and choir concert. They are what memories are made of and are priceless.

That's exactly the sort of expense that always seem to appear when you have no money. I imagine there are costs each month for school so you could give it its own YNAB category (my wild birds have their own bit in my budget).

Your SOA is going to be a work in progress for the first year or so. Have you got an allowance for replacing your passports?

The debt journey isn't easy and actually can be both time consuming and overwhelming. That's why I suggest having a list of self care things that make you feel a bit pampered.

I can understand why you want to consolidate you credit card debt into your mortgage when you remorgage to fund extending your lease. Most will say this is not advisable as you are making an unsecured loan into one secured on your flat. I can't advise you, sorry.

And that light at the end of the tunnel? You know it's there, don't you? November is a challenging time for everyone. There always seems to be too much to do in too little time.

Keep posting, enjoy the weekend
Pauline

@pauline thanks - yes I know there are school expenses each month on top of childcare and clubs. In Dec I plan to analyse spending from Oct - Dec and I should have a good idea how much it goes to that. Same goes for passports and pretty much anything else.

Regarding adding CC debts to the mortgage, I don't really want to do it, especially because it's still on 0%. However, I need to renew the lease on the flat before it drops to 85 years (if I don't, the lease extension costs skyrocket in the tens of thousands). I have a job now, and there is a way to do it - however Halifax won't lend me more because of the debt. Extending the lease costs about £7K at the moment, but it adds at least £15K to the flat value. So in that sense, it's a no brainer.

My plan is to shift the CC debt to the mortgage and borrow extra £7K, and make monthly overpayments. Just for the sake of the argument, this is how it would work:

current CC debt: £13K
current mortgage balance £180K (this will be the value mid next year)
current flat value: £400K, lease 92 years
current mortgage repayments: £1000 (rounded up)
current CC payments £300-400 (minimum is £300 or so)
total: £1300-£1400 monthly

new CC debt: £0 (and I plan to cancel ALL credit cards).
new mortgage balance: £200K (=£180K current mortgage +£13K cc debt+£7K lease)
new flat value: £415K, lease 182 years
new mortgage payments £900 (this is due to much lower interest rates)
but, I plan to make monthly over-payments of at least £300, so new total: £1200 monthly*.

*This is less than I'm paying at the moment and also, IF I make monthly overpayments of £300 I will pay much less interest over the term of the mortgage, see scenario 3 https://www.moneysavingexpert.com/mortgages/move-debts-to-mortgage

So, this all looks manageable and it only works IF:
1. I make monthly over-payments as planned
2. I cancel all credit cards
3. I never do this again

By the time I remortgage (July 2018) I believe I will have a very good idea if I am disciplined enough and have the willpower to stop using credit cards, so my plan is to make a decision then. If I manage to stay away from the CC card and overdraft, the above plan might be a good idea. If not... well then my problems are much bigger than I thought and I might as well start clean, sell the flat, pay off the mortgage and buy in a different area...

Hi Plush, I've just read through your diary. We're of similar age

The mortgage/loan calculation seems reasonable, but only if you actually stop using credit cards and using the overdraft. You have 6 months to train yourself

You've mentioned a few times that you will get a bonus at the end of the year; is it possible that in your mind you have spent this bonus several times already? For instance: 'I'll use it to pay off a credit card', 'I'll use it to pay off the overdraft', 'I'll use it to give myself a Christmas gift', 'I'll use it to buy dear child a Christmas gift', 'I'll use it to visit family'. It may make sense to completely disregard the bonus, to never take it into consideration and the moment it lands in your account, to make it the start of your emergency fund. Be very careful when assessing if something is an emergency. School photos come every year, some sort of school performance will also come every year, house maintenance ... well, things break down every 10 years or so, I believe the guideline is 2% of the house value should be spent on maintenance per year.


Good luck!

Just checking back in to say I'm still on track. I "made" some money as I returned some Decathlon ski gear I had bought in September (don't ask), they have a 365 days return policy for members. So at the moment I'm still in green, but I only have less than £50 left in my Halifax spending account - which should cover one week worth of groceries plus anything else. Pay day is on the 24th this month.

I would have more money, but I started a gym membership and the joining fee was £30. The monthly direct debit membership works out cheaper than paying for single yoga classes. It's £45 per month and there is no yearly commitment, they only need 15 days notice to end it. And the best of all, they have a promotion and it's free until 31 January, so the first payment comes out on the 1st of Feb. Also, the company I work for allows us to claim up to £150 each calendar year for "health and well-being" courses, including gym. I can claim that early next year, as I've already claimed this year's.

This weekend looks good, we're off to some friends' house for an early dinner on Sat, I will bake a cake and take a bottle of wine I already had at home. I'm hoping for good weather on Sunday so that we can go cycling in the local park - at the moment it looks like it will be cold but sunny.

Tonight's the first yoga session, I'm so excited to go back to yoga, no more whining on the sofa at home on Friday nights! I plan to go each Wednesday, but I can also go Friday evenings - whenever I'm not going out (and I haven't been going out much....). Won't be able to use the membership much outside of those 2 sessions, that's when DD is at her dad's. But, even if I go only once per week, it's still cheaper than paying for single yoga classes, which are over £11-13 in my area.

Thanks Pauline, Christmas for me is a good time - I normally recharge batteries, read, avoid shops and stay close to friends and family. I don't tend to spend and/or eat too much around Christmas, for some weird reason I'm able to keep bad habits in check around that time of the year. In any case, my annual work bonus will help me keep in green, but I really do hope to pay as much CC debt as I can with it, and not spend much of it.