I have massively fucked up our finances(224 Posts)
I've just been scooting along with my eyes shut for ages. I bit the bullet and sat down with DH to go through stuff a couple of months back and we were 14k into the credit cards, and paying interest.
We have a 13k bank loan which we took out to clear the last lot of credit card debt, there are still three years on that.
I also have a car loan that was around 14k, I think that's down to 12.5k now, 4.5 years to go. I am looking into selling the car back to the garage next month and buying a cheaper, smaller car (needed a 7 seater for work but don't anymore).
We then took out a new 0% cc and shifted stuff around, so we're not paying any interest now, but having totted up all the balances today we are now £16k into the cards. I know some of that is fees, but it's also that we've managed to piss £800 away over our budget in the last two months, and we have paid the balance of our holiday (£700).
It's completely unsustainable. About 6k of the debt was court fees, and 5k was our kitchen overspend. The rest is just spending.
Help me. Please give me all your best advice and tips. I seem to just be failing miserably at this. We have over 4k a month coming in and I don't understand how we overspend every single month, it's nuts.
Well done! Just don't slip back into bad habits, and focus on how much better life will be debt free!!! xx
Well done Skint and thanks for the update - it's great to hear how people get on further down the line.
My DH totally changed my attitude to money when we got together and now I look forward to our monthly review of the household budget spreadsheets
Ours is overperforming, which was an unexpected bonus.
Meanwhile we've had a repayment mortgage AND paid a crippling amount into the endowment. I knew it was a good idea when I thought of it but took my eye off the prize and felt like we were drowning in debt...
We're going. to continue putting the same amount away each month, in fact we should double it. Our income has doubled since we initially took on the repayments plus savings, so it should be easy, especially without any debts.
Well done for converting as well. We were warned about a shortfall so we took the potential worst case shortfall and converted into a reapyment.
Our endowment has now matured a few months ago and we are fine with about £10k to spare because we took the worst case scenario.
That is great Skin. I hope you dont mind me mentioning it, its just that I keep coming across people who dont understand that when you cash in an endownment its not 'spare' money. My degree educated BIL thinks the goverment will sort out any shortfalls and that it will all turn out OK in the end.
My other relative got himself a very cheap interest only mortgage when others had a much more expensive repayment. He kept boasting about his low repayments. Well years later he is struggling...
We switched to a repayment mortgage 5 years ago and kept the endowment as an untouchable savings account.
I thought we'd have to slog it out for another 16 months but the few grand we'll lose by cashing in early is offset by the interest we'll save by clearing everything. That and having a couple.of grand spare every month.
Sorry to be the voice of gloom - if you sell your endowment how will you pay off the interest only element of the mortgage. The reason I am saying this is that my DM took our an interest only mortgage with NO endownment and she has now no way of paying the mortgage back.
Also, a relative cashed in his endowments because he didnt believe they would pay out the full mortgage. Problem was he cleared his debts and went on a very nice holiday indeed. However now the mortgage has come to an end he has no way of paying it back.
Just found out officially that can sell our endowment , or just cash it in, and get almost the full 60k.
Which means we can start 2014 debt free, move house and save a huge amount of money over the next few years
I call that a result...
Aww, thanks for the update and good luck for 2014!
Hello all, I thought it would be good to update this thread.
I did get a new job, and quickly got promoted, and then dh changed his hours at work to save nearly £300PM in childcare.
Our new budget is £900pm for food, petrol and stuff, which means we are paying down just over 1.5k, some months 2k (overtime and commission) on the various debts. September was horrendous, we overspent by £1400 (!) so that was a setback but it is reducing nicely which is good to see. We update our spreadsheet on the 1st of every month.
We have found a house we'd like to offer on, and if we do we'll absorb the debts into the mortgage, but that's not ideal. My aim is to halve the debts by next April, which is when our endowment matures, and use that to clear them and move. We are going to see the house at the weekend, it seems to tick all of our boxes so if it really does we'll go for it (and then use the endowment to pay a chunk off in a year).
A nice kick start for the new year is the two months of no council tax, and dry January as usual, possibly Feb too.
We're not perfect, but we are doing ok.
This thread has been invaluable and I've reread it many times, thank you.
Skintorama - When we went self catering I took our slow cooker so I could set it up first thing and we could go off for the day without the awful thought of having to "cook".
We took loads of food with us so I didn't have to buy it on site
I've just read the whole thread. Hardly ever do that on long ones! We have almost identical income to you of £4000 and couldn't ever imagine being in debt, but this has really opened my eyes. S for that thank you. I too can be a bit frivolous with spending, and as we don't have children right now that's ok, but has made me realise I will have to be more sensible in the future.
Sounds like you are doing well OP. keep it up!
Hi. I was exactly like you (don't think I ran up the as much debt)! We are in the early days of budgeting (2months) but doing really well. Everyone is on board -hubby and 2 sons (11&8) which I think is key. None of us feel we are going without but really think about purchases before making them. Got a couple of heavy months approaching with new uniforms and costs associated with the move to senior school and entertaining the kids for 6 weeks! How key thing to making it work is keeping track of everything you spend.we have a spread sheet that each night we update. I'm a real spender on absolutely anything and everything but feel great for holding back and waiting to make a purchase. In less than a month I've saved enough cash to pay for all the new uniforms! Good luck but keep in mind hat you need to adopt new habits so that you don't end up like this again. It takes a lot of hardworking and discipline on everyone's part but in the end you will end up so much better off financially.also - no excuses!!!!! X
We are off to Northumberland.
Hoping for good weather.
Where are you going Badvoc?
We're off to Center Parcs at the end of the month and we're going to properly self cater ie cook instead of going out for expensive meals.
I notice you have roast chicken written down for next weekend, do you not get any left over meat from your chickens?
I know my OH would eat the whole thing if he thought he could get away with it, but I pick off anything left and it goes into soups, salad, pasta bakes, curry, risotto, sandwiches etc etc.
Last night I did 2 chicken breasts, rice, sweetcorn and green beans for all 4 of us, that was enough. Chicken was chopped and marinated. I could have done more chicken but decided it looked like enough once I'd chopped it, no one needed more.
Right...been to collect meds needed prior to hols.
Have drawn out cash for our holiday next week and I am not taking my purse/cards so when it's gone it's gone!
Getting a grocery shop delivered so hopefully won't need much extra food.
A budget sheet for people to test ....
Sorry, copied it straight over from excel and it didn't format well, but you get the idea.
Actually I've just played around with that, added another tenner on and it now takes us up to our holiday, so two and a half weeks.
FridayFish and chips
TuesdayFish and chips
SaturdayChinese pork and noodles
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