Being an adult and pulling head out from sand

dearbarbie · 7 August 2018 at 12:44PM

Hello everyone. I'm 36 and feel like I'm just becoming an adult - don't judge me. I know so many people are worse off than me. I was married until last year and my ex was one of those who sorted everything and I just paid half. I've never learned how to save. Until two years ago I was self-employed which actually saw me rack up a load of overdraft fees - classy. I do feel like my upbringing (narcissists) and my subsequent mental health (which I am in therapy for - mostly anxiety and poor decisions) doesn't help where I am and my attitude to money. I got a tax refund recently and instead of whacking on credit card, I decided I needed new clothes for work and a holiday - this stuff just really has to stop.

I coasted for ages without really thinking about my outgoings and well, here I am keen to lower my credit card debt and then add to my house savings (which are some of the pathetic proceeds from my divorce but let's not talk about how I let myself be ripped off!) I want to turn that situation into something good and not spend it all on holidays!!

Here's a rundown of my outgoings:

-rent: £700 a month - live alone, city centre, no car, walk everywhere apart from occasional bus to my bf. Used to Uber everywhere but reminding myself of my laziness! Still Uber if coming home late at night. Moving out of the city and commute costs would work out the same. Am renewing in September and will be asking for a discount (although last time I asked it was a no!)

-electricity - £80!!! I moved into a flat post-divorce and moving 200 miles away so found somewhere I could afford and would be okay being alone whilst I made new friends. It's blooming freezing in winter because it's all bricks inside and there's a tiny electric heater. It got up to £100 a month in December. I was in some awful company when I moved in and switched to Bulb. Is still £70 (was charging me £40 but upped it). Will be buying small EFFICIENT heater that's portable to replace it. This is one of my biggest bugbears. Even in summer I'm using a lot and unsure using an oven once a day/charging phone/occasional evening TV equates to this! No gas, at least. Would you recommend one of those electricity usage monitors?

-council tax - £120ish *shudder* inc single person discount

-contents insurance - about £15

-tv license - £13

-broadband - £20 with Sky. Am considering changing to Hyperoptic as my flat is a basement and has crap signal. Due to change contract next month - would love tips on any deals

-mobile phone - about £50. Yeahhh. I'm in contract until March 2019. No land line.

-pets - about £30. I have guinea pigs and am reducing this by switching their bedding and food. Irritatingly I can no longer buy in bulk like I used to because of being at work/no car if anything delivered to work.

-gym - £10 as is at work

-cc payments - about £200 a month

-water - about £45 a quarter

-beauty/personal care stuff - £50-70

-hobbies - I run a website that has costs (approx £80 a month - social media tool, Adobe Creative Cloud) and doesn't really make any money (but I get to go to events as often as I want for free rather than pay so does support a cheaper social life). Have considered closing it but supports my day job/CV and that of about 20 other people.

-professional membership - £170 a year

-I bring packed lunches to work most days, veggies, grains, and now I've discovered Aldi I will add some fish sometimes
-I eat similar for dinner, maybe with pasta - so food and drink at maybe £50 a week including socialising too. Sometimes more than that.

-having moved to a new city, it's all about being a 'yes' person to make new friends. I'm really trying to reduce this by being comfortable at home and invite people around rather than going out to bars.

-I have £15k in savings and I know I should whack those on the credit cards x2 and then I'm debt-free. But, I'm a contractor. I could be without work for 6 months and I have nobody - no family to rely on, nobody I can move in with, nobody to lend me money if I needed it - so feel like I really need that in my back pocket to calm my raging anxiety about being unemployed between contracts. (In all seriousness, I do have quite bad anxiety about period of unemployment!) Have bf but no sign of that heading in any direction anytime soon so it's just me, myself and I (and two guinea pigs)

-I add £100 a month to a Nutmeg savings accounts - I should be throwing that money at my ccs shouldn't I? I have only just realised that as I am typing it!

What else am I missing that should be on this budget list? Thank you if you made it this far - it's as much about reclaiming my life as well as my credit cards

macman · 7 August 2018 at 1:01PM

You haven't stated what your CC debt is, and at what APR? But nevertheless, it's insane to be paying interest on the CC's at (guess) 20%, when your savings are earning (guess) less than 2% and could clear the debt entirely.
I take your point about being self employed, but, worst case, you can use the once debt-free CC's to live on for a few months-or preferably get a O% card.
Put your figures into an SOA and post it for further advice.
PS: all electric heaters are the same efficiency (100%) so don't waste your money on a new one.

Willing2Learn · 7 August 2018 at 1:20PM

Hi dearbarbie,

It would be helpful if you completed a Statement of Affairs (SOA). It makes sure nothing is missed. Just fill out the form, click on the 'format for MSE' button at the bottom and post it up here.

http://www.stoozing.com/calculator/soa.php

dearbarbie · 7 August 2018 at 2:15PM

macman wrote: »

You haven't stated what your CC debt is, and at what APR? But nevertheless, it's insane to be paying interest on the CC's at (guess) 20%, when your savings are earning (guess) less than 2% and could clear the debt entirely.
I take your point about being self employed, but, worst case, you can use the once debt-free CC's to live on for a few months-or preferably get a O% card.
Put your figures into an SOA and post it for further advice.
PS: all electric heaters are the same efficiency (100%) so don't waste your money on a new one.

Thank you! I'll do that ASAP and paste in there.
You're right about the % on the CCs too - but rent can't be paid from credit cards.

I got the EPC thing from my flat and the heater is the worst-performing thing, like at the bottom of the scale. Surely they're not all inefficient as hell?

dearbarbie · 7 August 2018 at 2:21PM

Now I see this, the CCs really need to shrink. Also my credit rating isn't seeming great, considered stoozing to pay off without the % but I'm not showing more than a 70% acceptance which is a bit annoying - hoping this is because of the relocating stuff - not living somewhere long, no mortgage anymore

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household.........
Number of cars owned....................

Monthly Income Details
Monthly income after tax................ 2000
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2000

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 700
Management charge (leasehold property).. 0
Council tax............................. 120
Electricity............................. 80
Gas..................................... 0
Oil..................................... 0
Water rates............................. 15
Telephone (land line)................... 0
Mobile phone............................ 50
TV Licence.............................. 13
Satellite/Cable TV...................... 0
Internet Services....................... 20
Groceries etc. ......................... 150
Clothing................................ 50
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 30
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 50
Pet insurance/vet bills................. 30
Buildings insurance..................... 0
Contents insurance...................... 20
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 0
Entertainment........................... 200
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1548

Assets
Cash.................................... 18000
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 18000

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
cc1............................8000......100.......19.9
cc1............................10000.....100.......19.9
Total unsecured debts..........18000.....200.......-

Monthly Budget Summary
Total monthly income.................... 2,000
Expenses (including HP & secured debts). 1,548
Available for debt repayments........... 452
Monthly UNsecured debt repayments....... 200
Amount left after debt repayments....... 252

Personal Balance Sheet Summary
Total assets (things you own)........... 18,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -18,000
Net Assets.............................. 0

Created using the SOA calculator at https://www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using other browser.

Karonher · 7 August 2018 at 3:21PM

I think you can cut a bit off your food bill - even if it is just £10 - £20. Also entertainment could come down a bit. I understand what you are saying about the cold, but I would still be looking at cutting back on the electricity as much as possible.

Can you cut out the clothing budget for a few months and check the medical and pet budgets.

All this could give you up to another £100 and with this and £200 of your already available money could be paying a lot more off. I would also use at least some of the savings.

If you could get your spending down to £1450 a month you could keep 6 months money in savings which would be £8,700 - you could even leave £10,000 in savings and pay the rest off the cards.

Then you would have £9,000 to pay and by paying off £500 a month could be debt free in just over 18 months and save lots in interest

0Credit · 7 August 2018 at 3:38PM

Bring down life costs a little (20%)

Up your monthly payments to 3X your current

This way you pay off quicker, use small sums of your savings each month and still feel secure if your job was ever lost/something bad happened.

Mnd · 7 August 2018 at 3:56PM

See if you can get a 0% card as well, then use some savings to reduce some of the 20% balsnce you are paying.
You seem to be ok regarding your income and outgoings, so with your new focus you can get back in control relatively swiftly

Willing2Learn · 7 August 2018 at 4:01PM

dearbarbie wrote: »

Now I see this, the CCs really need to shrink. Also my credit rating isn't seeming great, considered stoozing to pay off without the % but I'm not showing more than a 70% acceptance which is a bit annoying - hoping this is because of the relocating stuff - not living somewhere long, no mortgage anymore....

Where is the spare £252/month going?

If you have breathing space on your credit card limits then it may be possible to stooze on a 3 year % balance transfer. Lenders want to see a solid credit history without defaults, late payments or arrears. Is that you? If so, then try going for the Tesco 36 month 0% balance transfer card. One solitary credit search is not going to negatively impact your credit report.

And ignore your credit rating. Lenders score you independently. They consider the data in your report and application and score you against their criteria and policies. They never see your credit rating...

dearbarbie · 9 August 2018 at 3:49PM

Karonher wrote: »

I think you can cut a bit off your food bill - even if it is just £10 - £20. Also entertainment could come down a bit. I understand what you are saying about the cold, but I would still be looking at cutting back on the electricity as much as possible.

Can you cut out the clothing budget for a few months and check the medical and pet budgets.

All this could give you up to another £100 and with this and £200 of your already available money could be paying a lot more off. I would also use at least some of the savings.

If you could get your spending down to £1450 a month you could keep 6 months money in savings which would be £8,700 - you could even leave £10,000 in savings and pay the rest off the cards.

Then you would have £9,000 to pay and by paying off £500 a month could be debt free in just over 18 months and save lots in interest

Thank you! I do fritter a lot on crap tbh - quick beer after work here and there, I'm in a new city where I don't know many people so being a bit of a 'yes' person. However I do have a Monzo card I really should be using to budget. Think I'll start using that to manage my entertainment budget as a starting point.

Medical is a no-change sadly, and I've reduced my pet budget significantly, just found somewhere yesterday that is even cheaper for bedding (guinea pigs).

I'm hoping to join walking groups and stuff where things are free too beyond transport there!

dearbarbie · 9 August 2018 at 4:02PM

0Credit wrote: »

Bring down life costs a little (20%)

Up your monthly payments to 3X your current

This way you pay off quicker, use small sums of your savings each month and still feel secure if your job was ever lost/something bad happened.

Ooh small bits of savings each month is a great idea - thank you!

Being an adult and pulling head out from sand

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