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  • FIRST POST
    • charliedavis
    • By charliedavis 5th Nov 18, 12:55 PM
    • 346Posts
    • 739Thanks
    charliedavis
    -99,152 net worth - scary figure
    • #1
    • 5th Nov 18, 12:55 PM
    -99,152 net worth - scary figure 5th Nov 18 at 12:55 PM
    Unbelievably, this huge amount of debt has been incurred solely in the last 3 years.

    It was even higher, but I've been working with a debt counsellor and we've managed to reduce it down by around 5,000 in the last 30 days.

    As you can see from the SOA below, the debt is being paid - just about. There's even room for some over payments.

    However as we are both self employed - the income below is as of today. It is finely balanced and we can both have a bad month, meaning this budget gets knocked and we have ended up using credit.

    With no savings, this has meant we have tended to use credit haphazardly and irresponsibly.

    I am determined to get this paid off hence this diary, and really hoping for your support!

    As you can see, we are renting which is really expensive, and we want to buy a house eventually.

    We have nothing to show for the amount we have spent, except some great holiday photos.

    Yes I inherited this method of overspending from my parents, as did my OH - but I want this pattern to stop now before I pass it on my kids too.

    I'll add this first post now then continue to add more thoughts.

    Statement of Affairs and Personal Balance Sheet

    Household Information

    Number of adults in household........... 2
    Number of children in household......... 2
    Number of cars owned.................... 2

    Monthly Income Details

    Monthly income after tax................ 5000
    Partners monthly income after tax....... 3600
    Benefits................................ 0
    Other income............................ 180
    Total monthly income.................... 8780


    Monthly Expense Details

    Mortgage................................ 0
    Secured/HP loan repayments.............. 342
    Rent.................................... 2850
    Management charge (leasehold property).. 0
    Council tax............................. 280
    Electricity............................. 100
    Gas..................................... 0
    Oil..................................... 190
    Water rates............................. 26
    Telephone (land line)................... 0
    Mobile phone............................ 200
    TV Licence.............................. 12
    Satellite/Cable TV...................... 43
    Internet Services....................... 48
    Groceries etc. ......................... 600
    Clothing................................ 60
    Petrol/diesel........................... 180
    Road tax................................ 0
    Car Insurance........................... 165
    Car maintenance (including MOT)......... 60
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 0
    Other child related expenses............ 30
    Medical (prescriptions, dentist etc).... 20
    Pet insurance/vet bills................. 0
    Buildings insurance..................... 0
    Contents insurance...................... 0
    Life assurance ......................... 47
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 100
    Haircuts................................ 60
    Entertainment........................... 400
    Holiday................................. 200
    Emergency fund.......................... 0
    Amazon (toiletries, book etc)........... 60
    Itunes subscriptions for work........... 20
    Netflix................................. 10
    Pet food................................ 62
    Total monthly expenses.................. 6165



    Assets

    Cash.................................... 0
    House value (Gross)..................... 0
    Shares and bonds........................ 0
    Car(s).................................. 6000
    Other assets............................ 0
    Total Assets............................ 6000



    Secured & HP Debts

    Description....................Debt......Monthly.. .APR
    Mortgage...................... 0........(0)........0
    Hire Purchase (HP) debt ...... 19500....(342)......6.85
    Total secured & HP debts...... 19500.....-.........-


    Unsecured Debts
    Description....................Debt......Monthly.. .APR
    MBNA...........................18572.....450...... .23
    MBNA...........................6814......100...... .0
    MBNA...........................6322......100...... .0
    Sainsburys Loan................12500.....300.......12
    Barclaycard....................4876......100...... .20
    Barclaycard....................12735.....300...... .15
    Zopa Loan......................23833.....689.......15
    Total unsecured debts..........85652.....2039......-



    Monthly Budget Summary

    Total monthly income.................... 8,780
    Expenses (including HP & secured debts). 6,165
    Available for debt repayments........... 2,615
    Monthly UNsecured debt repayments....... 2,039
    Amount left after debt repayments....... 576


    Personal Balance Sheet Summary
    Total assets (things you own)........... 6,000
    Total HP & Secured debt................. -19,500
    Total Unsecured debt.................... -85,652
    Net Assets.............................. -99,152


    Created using the SOA calculator at www.stoozing.com.
    Reproduced on Moneysavingexpert with permission, using other browser.
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
Page 2
    • charliedavis
    • By charliedavis 6th Nov 18, 3:05 PM
    • 346 Posts
    • 739 Thanks
    charliedavis
    I have just read the posts above and see you have already answered about the Zopa loan. Putting money aside for tax/NI is also critical when you are self employed. Do you have an accountant? Good to see you have already put some economy measures in place.
    Originally posted by enthusiasticsaver
    Yes I do have a good accountant, thank goodness. I worked out I need to pay 400 per month towards my January self assessment to avoid getting into debt. Best option will be to pre-pay it to the HMRC I think.
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
    • enthusiasticsaver
    • By enthusiasticsaver 6th Nov 18, 4:17 PM
    • 7,284 Posts
    • 15,987 Thanks
    enthusiasticsaver
    Sorry the HP is for a car that is technically on a lease, i.e. we plan to hand it back 2 years in and exchange it for a new one, due to the number of miles OH does. I presume I could probably remove it for that reason?

    Yes totally agree our overheads are waaaay too night, looking forward to moving to somewhere far cheaper in August.
    Originally posted by charliedavis
    You could remove it if paid from the business account. If it comes out of the income quoted on the soa then you need to leave it there as a liability although technically it is car lease and not HP which is when you keep the asset at the end.


    Remember moving costs money so over the 10 months or so before moving you will need to save up to cover moving fees, deposits etc. Not a problem and presumably at some point you will get a deposit back from your current property but that won't come back until after you need to pay for a new rental.

    Yes I do have a good accountant, thank goodness. I worked out I need to pay 400 per month towards my January self assessment to avoid getting into debt. Best option will be to pre-pay it to the HMRC I think.
    Originally posted by charliedavis

    I am glad you have an accountant and are prepared for tax costs. So many self employed people get themselves into a real pickle with this and then end up panicking when it gets to SA and the tax deadline.
    Debt free and mortgage free and early retiree. Living the dream

    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 forumteam@moneysavingexpert.com
    • charliedavis
    • By charliedavis 6th Nov 18, 7:02 PM
    • 346 Posts
    • 739 Thanks
    charliedavis
    That is so true about the house deposit - it will cost us at least 800 in moving costs, 500 in referencing and around 2500 in deposits so this definitely needs to go into the budget.

    In other news - DS is throwing a hissy fit. He got a job at the local pub but was told hed only be paid 4.50 per hour. Hes now in a massive sulk - Im presuming he will then decide he doesnt want the job. He needs the job to pay for his car insurance and I think hes just presuming we will give in and pay for it. Hes definitely the one thats having the toughest time adjusting to the new budget. Currently hes refusing to drink anything in the house as we bough unbranded squash... even typing this I feel guilty what a spoilt kid Ive raised :-(
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
    • enthusiasticsaver
    • By enthusiasticsaver 6th Nov 18, 9:59 PM
    • 7,284 Posts
    • 15,987 Thanks
    enthusiasticsaver
    A bit of tough love needed with your DS I think. Tell him to buy his own branded squash out of his first weeks wages. Stick to your guns. My DD2's first job was cleaning caravans in a local caravan park for a fairly low wage and she hated it but stuck it out for a year including through the summer and easter holidays and earned herself a massive bonus. The biggest plus though was that she realised how hard she had to work to earn a decent salary and resolved to study hard to get qualifications and a decent job after school/university with good wages. Sometimes we can make life too easy for our young adults and it does them no favours in the long run.
    Debt free and mortgage free and early retiree. Living the dream

    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 forumteam@moneysavingexpert.com
    • adg89
    • By adg89 7th Nov 18, 10:04 AM
    • 49 Posts
    • 23 Thanks
    adg89
    Totally with enthusiasticsaver

    DS will definitely thank it for you later. Being given money will not make him realise how hard you have to work to earn it, but by earning it himself, he will learn the value of his money going forward and will maybe make his own concessions on branded squash.


    Keep going charliedavis, you've got this!
    My DF Journey Start: 22/10/18 DFD: 25/03/19
    VM CC 5,620.10 OD - PAID OFF OH Cap One: 300 OH Aqua: 700
    Owed to fam/friends: 423 EF - 170/720 (23%)
    Total Debt Remaining: 7,043.10/8,991.57 21.5% gone
    Balloon Payment for adg89's car due in March 2019 - Amount due will be 5,227

    • charliedavis
    • By charliedavis 7th Nov 18, 10:39 AM
    • 346 Posts
    • 739 Thanks
    charliedavis
    Thanks all!

    So a quick update on the first week of November having meticulously tracked our spend (for the first time ever!)

    1) Grocery spend 99.17 (thinking around 100 per week might be doable based on this week)
    2) Holiday spend 90.53 (had budgeted 100 for a night away for my birthday so came in under budget)
    3) Eating out / misc 47.98
    4) Credit overpayments 2811.91 (made using tax overpayment for OH - normally we'd have booked a holiday with this!)
    5) Savings towards EF 200
    6) Prepayment towards my self-assessment 100. If I pay 100 per week until Jan I will pay it in full

    I'm finding the daily habit of tracking our spend to be really helpful and OH is fully on board with this. He's making sandwiches to take with him and taking a drink to avoid needing to spend while out. It's a shame DS hasn't quite got it yet, but we will get there!
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
    • enthusiasticsaver
    • By enthusiasticsaver 7th Nov 18, 11:47 AM
    • 7,284 Posts
    • 15,987 Thanks
    enthusiasticsaver
    Brilliant first week and so good you used the 2811 towards debt overpayment and saved for EF and tax. Reducing 220 to 100 on groceries spend is great although you could probably get it down further using Aldi or Lidl. Small steps though. Hopefully your DS will take the pub job. If not I would seriously think about pulling back on the driving lessons if he won't get on board. He is almost an adult so should be starting to grow up a bit and realise the world can be a tough place.
    Debt free and mortgage free and early retiree. Living the dream

    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 forumteam@moneysavingexpert.com
    • charliedavis
    • By charliedavis 7th Nov 18, 3:22 PM
    • 346 Posts
    • 739 Thanks
    charliedavis
    Just had another 1958.55 tax rebate - about to go and pay it in at the post office. I’ll then use this towards my EF and further debt repayment.

    OH has broken our NSD by spending 1 on bread - sigh... well we nearly would have managed it! Need to buy more / freeze more next time
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
    • charliedavis
    • By charliedavis 9th Nov 18, 1:39 PM
    • 346 Posts
    • 739 Thanks
    charliedavis
    NSD yesterday, the second this month. Did have business expenditure though.
    Been busily sorting out life insurances, basic private medical insurance, income protection insurance. Following the advice in the Barefoot Investor book that arrived a couple of days ago.

    I don't find I can apply all it yet until I've paid down a lot of the debt, anyway else that has read the book find this?

    In other news - DS did his first shift as a kitchen porter and enjoyed it - YAY! He has accepted 4 evening shifts next week which is great news. So pleased for him.
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
    • adg89
    • By adg89 9th Nov 18, 1:43 PM
    • 49 Posts
    • 23 Thanks
    adg89
    Congrats to DS on the job - hopefully he will see the benefit soon!


    Well done on the NSD - I find even if I break it, so long as it's a low spend (under 5) for the day - and it's not too frequent - I don't need to be despondent as it would still be less than I would have spent in the past!


    Go you!
    My DF Journey Start: 22/10/18 DFD: 25/03/19
    VM CC 5,620.10 OD - PAID OFF OH Cap One: 300 OH Aqua: 700
    Owed to fam/friends: 423 EF - 170/720 (23%)
    Total Debt Remaining: 7,043.10/8,991.57 21.5% gone
    Balloon Payment for adg89's car due in March 2019 - Amount due will be 5,227

    • charliedavis
    • By charliedavis 9th Nov 18, 2:24 PM
    • 346 Posts
    • 739 Thanks
    charliedavis
    Yes I totally agree about aiming for NSDs and it still being okay if it's just a couple of pounds, that makes sense!

    Just rang and closed my Next Directory account down having paid it off in full a couple of weeks ago. Their VIP sales used to tempt me into spending a good 3000 or so each year! It's a very satisfying feeling :-)
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
    • ImpulseSpender
    • By ImpulseSpender 9th Nov 18, 3:36 PM
    • 60 Posts
    • 131 Thanks
    ImpulseSpender
    So glad your son enjoyed his first shift. I loved having my own money when I first started my first part-time job, felt like I could spend it how I wanted without anyone giving their opinion!
    Make 100 in November: 132.39/150.00 / November NSDs: 3/15
    FD CC - 258.78/258.78, Santander CC - 50/3564.05, MBNA CC - 400/3144.96, Savings - 300/5000
    • charliedavis
    • By charliedavis 10th Nov 18, 10:17 AM
    • 346 Posts
    • 739 Thanks
    charliedavis
    Just set up a weekly direct debit to ensure my self assessment is paid off on time by January, and now doing the same for OH. feeling very organised!
    McDonalds last night for a rapid tea, just got off a 5 hour off train journey and OH had emergency jobs he needed to get to. Not very money saving OR healthy but when his phone rings he has to take the work - the downside of being self-employed
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
    • charliedavis
    • By charliedavis 10th Nov 18, 10:39 AM
    • 346 Posts
    • 739 Thanks
    charliedavis
    Updated SOA, as didn't have allowances in for Self assessment. This will be a tight few months due to the tax bills being due at the end of Jan. May not be able to make overpayments until those are paid off.

    Also updated to remove the car which is on a lease linked to HP, as it will be handed back in 2 years time and replaced with another for OH work, so isn't technically a debt.

    Quite a bit paid off in the last few weeks thanks to tax repayments from previous years, which has given us the chance to build some cash reserves, definitely needed with 2 self-employed people.

    Statement of Affairs and Personal Balance Sheet

    Household Information

    Number of adults in household........... 2
    Number of children in household......... 2
    Number of cars owned.................... 2

    Monthly Income Details

    Monthly income after tax................ 5000
    Partners monthly income after tax....... 3600
    Benefits................................ 0
    Other income............................ 317
    Total monthly income.................... 8917


    Monthly Expense Details

    Mortgage................................ 0
    Secured/HP loan repayments.............. 0
    Rent.................................... 2850
    Management charge (leasehold property).. 0
    Council tax............................. 280
    Electricity............................. 100
    Gas..................................... 0
    Oil..................................... 190
    Water rates............................. 26
    Telephone (land line)................... 0
    Mobile phone............................ 200
    TV Licence.............................. 12
    Satellite/Cable TV...................... 42
    Internet Services....................... 47.5
    Groceries etc. ......................... 433
    Clothing................................ 60
    Petrol/diesel........................... 160
    Road tax................................ 26
    Car Insurance........................... 165
    Car maintenance (including MOT)......... 60
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 0
    Other child related expenses............ 12
    Medical (prescriptions, dentist etc).... 30
    Pet insurance/vet bills................. 0
    Buildings insurance..................... 0
    Contents insurance...................... 0
    Life assurance ......................... 96
    Other insurance......................... 110
    Presents (birthday, christmas etc)...... 100
    Haircuts................................ 60
    Entertainment........................... 240
    Holiday................................. 200
    Emergency fund.......................... 0
    Self assessment (OH).................... 300
    Self assessment (me).................... 400
    Car lease............................... 337
    Pet food/care........................... 62
    Itunes.................................. 20
    Netflix................................. 9
    Driving lessons......................... 245
    Total monthly expenses.................. 6872.5



    Assets

    Cash.................................... 3500
    House value (Gross)..................... 0
    Shares and bonds........................ 0
    Car(s).................................. 6000
    Other assets............................ 0
    Total Assets............................ 9500


    No Secured nor Hire Purchase Debts


    Unsecured Debts
    Description....................Debt......Monthly.. .APR
    MBNA Horizon...................18100.....500.......23
    Zopa Loan......................23833.....689.......15
    MBNA Nuba......................6814......100.......0
    Sainsburys Loan................12500.....300.......12
    MBNA...........................6322......0........ .200
    Barclaycard....................4875......100...... .150
    Barclaycard....................12735.....300...... .15
    Total unsecured debts..........85179.....1989......-



    Monthly Budget Summary

    Total monthly income.................... 8,917
    Expenses (including HP & secured debts). 6,872.5
    Available for debt repayments........... 2,044.5
    Monthly UNsecured debt repayments....... 1,989
    Amount left after debt repayments....... 55.5


    Personal Balance Sheet Summary
    Total assets (things you own)........... 9,500
    Total HP & Secured debt................. -0
    Total Unsecured debt.................... -85,179
    Net Assets.............................. -75,679


    Created using the SOA calculator at www.stoozing.com.
    Reproduced on Moneysavingexpert with permission, using other browser.
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
    • charliedavis
    • By charliedavis 11th Nov 18, 10:17 AM
    • 346 Posts
    • 739 Thanks
    charliedavis
    Had a couple of glasses of wine last night and booked us a February weekend away in Geneva for 36 each (flights only so far). We'd decided not to go on big holidays next year, just a cheaper 7 day holiday and a couple of weekends away but still feeling daft that I spent my entire 75 HSBC switch cash on the flights. Holidays have been one of our downfalls in the past few years, as we both love experiencing new places.

    In other news did a Tesco shop for 85, think I will alternate Tesco and Aldi as Aldi's toiletries and packed lunch items are great but I don't find their fruit and veg lasts as long as Tesco.

    Been reading a website by Rami Sethi who says it's far easier to add 1000 of income than save 1000 from your bills so thinking of setting up a People Per Hour profile and doing some extra work on the side to get more cash in to pay off debts. OH business doing really well at the moment so our income will be higher this month than normal, and xmas is always busy for him too.
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
    • charliedavis
    • By charliedavis 11th Nov 18, 10:20 AM
    • 346 Posts
    • 739 Thanks
    charliedavis
    Ooh forgot to add - logged on to Barclaycard yesterday and reduced my credit limit, I have been doing this monthly as I pay the debt off
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
    • BookmobileBadGirl
    • By BookmobileBadGirl 11th Nov 18, 11:37 AM
    • 112 Posts
    • 152 Thanks
    BookmobileBadGirl
    Are you really not paying anything to your MBNA card each month?
    Mortgage - Shared Ownership 25% 75,300 - MF December 2051

    Currently (27/09/18) 65,900 Aim (31/12/2018) 65,300
    • redmel1621
    • By redmel1621 12th Nov 18, 10:32 PM
    • 5,901 Posts
    • 25,625 Thanks
    redmel1621
    You seem to be making great headway on the debts.

    Well done sticking to your guns about the grocery cut backs and I'm sure your ds will come round to the cheaper brands
    Unless someone like you cares a whole awful lot,
    Nothing is going to get better. It's not.

    • charliedavis
    • By charliedavis 13th Nov 18, 12:47 PM
    • 346 Posts
    • 739 Thanks
    charliedavis
    Our 3rd NSD yesterday. I cannot remember having NSDs at all in the past so this is amazing, OH is really working hard with me.

    Not going to manage one today, as I had my eyebrows threaded for 8.

    Overall, I feel like a different person, I am thinking differently about spending, about debt.

    Signed a new client yesterday which is an extra 700 per month to put towards the debt.

    DS is enjoying his new job, and found out he can get a pay rise after working there for a few months, and does get a share of the tips so his pay should be higher than 4.50. He's always loving cooking and is actually assisting the chef so it really is such a great job for him!

    Sounds like I need to update my SOA as I must have forgotten to put an MBNA payment in there, whoops!
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
    • charliedavis
    • By charliedavis 13th Nov 18, 5:40 PM
    • 346 Posts
    • 739 Thanks
    charliedavis
    Decided to pay off 1000 from the largest debt with the tax repayment, and EF is now up to 1200. OH is having a really good month too so we should be able to overpay on our minimum payments by at least 1500 per month. Looking at the snowball debt destroyer this shows our debt as being paid offin 28 months so not too long at all. It's got me super motivated to earn extra income so we can pay it off even faster!

    In other news, got my DD's xmas pressie sorted, bought her a second-hand PC so she can play Sims. Also bought her a beautiful red leather chair from Facebook Marketplace for 10.
    November NSDs: 3/10

    -99,152 net worth - scary figure - my diary out of debt!
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