September onwards
worriedDan
Posts: 262 Forumite
Hi everyone,
would we keen to get other peoples thoughts on this.
In September our income will increase a fair bit due to my wife returning to full time work, plus my annual increment. I am also continuing to do my additional work at evenings/weekends. My parents are paying me back £130 per month based on some money that I loaned them some years ago.
I have decided to do an updated SOA for September onwards. I have tried to be realistic with out living costs and also the amounts that we need to put aside for emergencies/Christmas etc.
I have decided not to include a figure for entertainment, holidays or unsecured debt payments as I want to see how much is left after essential spending. More comments after SOA – see below
Household Information[/b]
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 3690 this is my main income, plus the additional work that I do
Partners monthly income after tax....... 1222
Benefits................................ 82.8
Other income............................ 130 This is the money that my parents pay me back from an old loan
Total monthly income.................... 5124.8
Monthly Expense Details
Mortgage................................ 507
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 105
Electricity............................. 40
Gas..................................... 69
Oil..................................... 0
Water rates............................. 33
Telephone (land line)................... 15
Mobile phone............................ 40
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 12
Groceries etc. ......................... 250 This seems to be what we spend on a normal month, including all clearning products and toiletries, plus a few beers and a bottle or two of wine
Clothing................................ 50 – never sure what to put here
Petrol/diesel........................... 160 – This is what we spend during term time. It drops significantly in school hols to around £80 but decided to use the higher figure
Road tax................................ 5
Car Insurance........................... 92 – this is for 2 cars, plus breakdown insurance. I have 6 points so can’t get my any lower just yet!!
Car maintenance (including MOT)......... 50 – based on 2 MOT’s, 2 services and wear and tear repairs, tyres etc
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 75 before/after school provision
Other child related expenses............ 61 swimming lessons, beavers, martial arts.
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 25 – pay £25 for building and contents
Contents insurance...................... 0
Life assurance ......................... 35
Other insurance......................... 5
Presents (birthday, christmas etc)...... 100 - this is too much, however I have don’t want any Christmas debt, so keeping this at a higher amount until the new year
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 50 – our boiler isn’t great and I think that we may need some new radiator at some point soon.
HMRC payment............................ 122 – this ends just after Christmas !!!128522; !!!128522;
Total monthly expenses.................. 1923
Assets
Cash.................................... 15000 – wifes money from family – please see my earlier posts for more info – we can’t touch this just yet.
House value (Gross)..................... 200000 – based on other houses in the area
Shares and bonds........................ 0
Car(s).................................. 8000
Other assets............................ 0
Total Assets............................ 223000
Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 68000....(507)......1.8
Total secured & HP debts...... 68000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Total unsecured debts..........0.........0.........-
Monthly Budget Summary
Total monthly income.................... 5,124.8
Expenses (including HP & secured debts). 1,923
Available for debt repayments........... 3,201.8
Monthly UNsecured debt repayments....... 0
Amount left after debt repayments....... 3,201.8
Personal Balance Sheet Summary
Total assets (things you own)........... 223,000
Total HP & Secured debt................. -68,000
Total Unsecured debt.................... -0
Net Assets.............................. 155,000
So it appears that we will have £3201.80 left after we have covered our living costs and saved a little for emergencies/Christmas.
Our minimum debt payments are around £1250 so this reduces that figure to £1951
If we overpay our debts by £750 we will be paying 2K per month. This reduces the ‘surplus’ to £1201
We certainly don’t need £1201 per month for entertainment and holidays. I am thinking of allocating £300 per month for entertainment and £200 for holidays. This leaves £701
So do we save the £701 per month and additional emergency savings, or do we knock it off the debts?? Alternatively I could drop the additional work that I do, however I think that this would be irresponsible of me as it brings in £440 per month. I will be looking to drop this as soon as we are debt free though.
would we keen to get other peoples thoughts on this.
In September our income will increase a fair bit due to my wife returning to full time work, plus my annual increment. I am also continuing to do my additional work at evenings/weekends. My parents are paying me back £130 per month based on some money that I loaned them some years ago.
I have decided to do an updated SOA for September onwards. I have tried to be realistic with out living costs and also the amounts that we need to put aside for emergencies/Christmas etc.
I have decided not to include a figure for entertainment, holidays or unsecured debt payments as I want to see how much is left after essential spending. More comments after SOA – see below
Household Information[/b]
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 3690 this is my main income, plus the additional work that I do
Partners monthly income after tax....... 1222
Benefits................................ 82.8
Other income............................ 130 This is the money that my parents pay me back from an old loan
Total monthly income.................... 5124.8
Monthly Expense Details
Mortgage................................ 507
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 105
Electricity............................. 40
Gas..................................... 69
Oil..................................... 0
Water rates............................. 33
Telephone (land line)................... 15
Mobile phone............................ 40
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 12
Groceries etc. ......................... 250 This seems to be what we spend on a normal month, including all clearning products and toiletries, plus a few beers and a bottle or two of wine
Clothing................................ 50 – never sure what to put here
Petrol/diesel........................... 160 – This is what we spend during term time. It drops significantly in school hols to around £80 but decided to use the higher figure
Road tax................................ 5
Car Insurance........................... 92 – this is for 2 cars, plus breakdown insurance. I have 6 points so can’t get my any lower just yet!!
Car maintenance (including MOT)......... 50 – based on 2 MOT’s, 2 services and wear and tear repairs, tyres etc
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 75 before/after school provision
Other child related expenses............ 61 swimming lessons, beavers, martial arts.
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 25 – pay £25 for building and contents
Contents insurance...................... 0
Life assurance ......................... 35
Other insurance......................... 5
Presents (birthday, christmas etc)...... 100 - this is too much, however I have don’t want any Christmas debt, so keeping this at a higher amount until the new year
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 50 – our boiler isn’t great and I think that we may need some new radiator at some point soon.
HMRC payment............................ 122 – this ends just after Christmas !!!128522; !!!128522;
Total monthly expenses.................. 1923
Assets
Cash.................................... 15000 – wifes money from family – please see my earlier posts for more info – we can’t touch this just yet.
House value (Gross)..................... 200000 – based on other houses in the area
Shares and bonds........................ 0
Car(s).................................. 8000
Other assets............................ 0
Total Assets............................ 223000
Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 68000....(507)......1.8
Total secured & HP debts...... 68000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Total unsecured debts..........0.........0.........-
Monthly Budget Summary
Total monthly income.................... 5,124.8
Expenses (including HP & secured debts). 1,923
Available for debt repayments........... 3,201.8
Monthly UNsecured debt repayments....... 0
Amount left after debt repayments....... 3,201.8
Personal Balance Sheet Summary
Total assets (things you own)........... 223,000
Total HP & Secured debt................. -68,000
Total Unsecured debt.................... -0
Net Assets.............................. 155,000
So it appears that we will have £3201.80 left after we have covered our living costs and saved a little for emergencies/Christmas.
Our minimum debt payments are around £1250 so this reduces that figure to £1951
If we overpay our debts by £750 we will be paying 2K per month. This reduces the ‘surplus’ to £1201
We certainly don’t need £1201 per month for entertainment and holidays. I am thinking of allocating £300 per month for entertainment and £200 for holidays. This leaves £701
So do we save the £701 per month and additional emergency savings, or do we knock it off the debts?? Alternatively I could drop the additional work that I do, however I think that this would be irresponsible of me as it brings in £440 per month. I will be looking to drop this as soon as we are debt free though.
0
Comments
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Hopefully someone else will be along to provide more feedback, but if it were me I'd definitely be looking at ways to clear the debts more quickly, simply to save on the amount of interest you'll be paying to your creditors.
You don't go into the detail of your unsecured debts, so it depends if this is credit card debts (likely to be high interest) or a fixed term loan/s, or a mix of both. I'd focus on any credit card debt and pay off the smallest balance outstanding first, then put all the money you'd pay that one to the next etc. and so forth.
Whilst you don't want to leave yourself short and understanding that you want to live a little (which you deserve when doing a 2nd job) you might want to hold off on that entertainments and holidays pot and use more of your surplus to get yourself in a better position (referring to the interest charges you are handing over each month).
With that said you seem to have a good handle on the situation, so good luck with it.0 -
You have done well so far with your plan. You pay a good amount already off your debts and seem solid in your resolve.
Any surplus maybe just save some of it and put a little more towards debt bringing that debt free date a little closer. Others are more knowledgeable on this but maybe snowballing some of the debts with higher interest so you feel like you are getting somewhere a little faster?
The more money/cash you save the less likely you will need to borrow again and you have money handy if you ever need it. There's not actually anything listed for an emergency fund or cash assets other than your wife's money?
I'd keep the entertainment and holiday money, maybe reduce a little or if you don't spend it all you can put towards debt at the end of the month. Plus you and your family need a little something to look forward to.0 -
I'd probably save the £700 to generate an emergency fund, given that the £15k appears untouchable (to cover six months outgoings).
A couple of other things...
Your net pay is quite high. Are you earning over £50k per annum? Is your extra income taxable? Are you paying into a pension? You start to lost child benefit over £50k and you pay 40% tax on income over £45kish. Paying into a pension can resolve all these issues and potentially gives you access to an employer pension contribution.
You have a solid plan to tackle your debts so I think now is the time to think about the bigger financial picture by making sure that your (understandable) focus on paying down debt is not costing you elsewhere, in the long term.0 -
Happier_Me wrote: »I'd probably save the £700 to generate an emergency fund, given that the £15k appears untouchable (to cover six months outgoings).
A couple of other things...
Your net pay is quite high. Are you earning over £50k per annum? Is your extra income taxable? Are you paying into a pension? You start to lost child benefit over £50k and you pay 40% tax on income over £45kish. Paying into a pension can resolve all these issues and potentially gives you access to an employer pension contribution.
You have a solid plan to tackle your debts so I think now is the time to think about the bigger financial picture by making sure that your (understandable) focus on paying down debt is not costing you elsewhere, in the long term.
Presuming the extra income is taxable then the gross salary on this take home would be about 63k. You can still receive Child Benefit but would have to pay the High Income Child Benefit Charge but at over 60k then I think the tax you have to pay is the same as the child benefit you receive so it zeros out effectively. The OP may already be paying this tax charge. If they're not then they need to do something about this quickly as if this level of salary has been going on for a while whilst child benefit has been claimed then it will need paying back to HMRC.0 -
in the famous words of Mr Ramsey
£1000 in emergency funds then hammer the debts starting smallest to largest
then 3-6 month expenses then clear mortgage then boom get yourself ready to prepare for your future and live like no one else
honestly I am loving dave ramsey and have made a fab start on smashing my debt down .. just google him and you will be hooked
Lisa xDFW
January £0/£11,100
NSD
January 1/310 -
I'm a dave Ramsey can too! Watch him on you tube every night whilst cooking. Check out the debt free screams and you will see what's achievable.
The good thing is you have a decent surplus which gives you choice.0 -
As your childs entertainment is already catered for I think £300 is way too much.
I would put at least half of that away for emergencies.Tallyhoh! Stopped Smoking October 2000. Saved £29382.50 so far!0
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