This is how I’m organising my money - can any experts take a look for me?

[StickyShoess]

I’m quite new in taking control of our finances, we were in a mess we had no idea what we had coming in and going out, direct debits were being missed and charges added on, we were living in our overdraft being charged daily for it and I held my breath at the checkout every single time, it was awful
Then we had an unexpected fourth baby and had to extend our house
So we are in a lot of debt

Finally about a year ago I said this is ridiculous and started trying to sort it out, after a lot of trial and error this is my current system -

DPs wages cover all bills and minimum debt payments - all DDs & SOs go out on the first of every month
Every week we get £118 tax credits, £110 of this gets transferred by SO to a separate bank account and this is our groceries & petrol money for the week
Every 4 weeks we get £247 child benefit, £100 goes by SO to our ‘occasions’ bank account and £100 goes to our ‘spending’ bank account
Then on the day before payday each month I take whatever is leftover in the main bank account and send it to debt and start on payday from scratch

I feel like this is the best system I’ve come up with so far but I just feel like it’s so slow moving and I’m never going to pay off our debt
What do you all think? Anything glaringly obvious that I can change?
TIA

How much debt are you in? I only ask because there's a chance your repayments are only just covering your interest charges which will add on more time.

Speak to step change about your debt.

Sounds complicated but I guess it works with the money coming in at different times. I'd look at the debt to make sure you are paying it off in the most cost effective way. On the Martin Lewis site 'snowballs' used to be popular and can help you shave years off your debt free date.

What does your "occasions" and "spending" bank account cover?

Debt is around £25,000
I have spoke to stepchange last year and their advice was to get an Iva which we really weren’t too keen on, it’s in the back of my mind as a last resort but I’d prefer to see what we can do ourselves first
We can afford all the repayments and have some left over at the end of the month to pay extra it’s just not much extra and I feel like it will take an age
I’ve been reading Dave Ramsay and I’m snowballing already, I assume it’s the same system as Martin Lewis advises?

The occasions account cover ms birthdays, Xmas, Easter, Halloween, weddings, christenings etc
The spending account is for clothes, haircuts, makeup, eyebrows, days out with kids, dog groomers etc, basically all variable non essentials

Are the dents a mix of loan and credit card? Could you move the credit card to interest free?

Debts!

The debts are a bank loan, a loan from my mum, 2 credit cards, 2 finance purchases, car finance, housing benefit overpayment, 2 unpaid bills from years ago that went to debt recovery companies, the council house surveyor and a couple of parking/speeding tickets (fucking DP!)
Tbh the credit cards are the 2 smallest debts and the ones I’ve currently been snowballing, I hadn’t considered changing them though and tbh I wouldn’t know how to - could you talk me through it? as I said I’m very new to this being a responsible adult business

Whats snowballing please?

Snowballing is where you change all your debts to minimum payments (although mine were all set to this already) then you start with your smallest debt and throw all extra money at it until it’s gone, then you take the next smallest debt and put your previous debts minimum payment + all extra money towards that one till it’s gone, etc etc until they’re all gone

Thank you! I might try it

We can afford all the repayments

Did you mean you can afford all the minimum repayments?

Cut back drastically on the non-essentials - I know it sounds trite but every little really helps.

Use Money Saving Expert to see if you can reduce what you're spending on utilities, TV, mobile phones etc.

Can you save money on your food bill? My sister swears by Jack Monroe, but I've never used any of their recipes: cookingonabootstrap.com/

Keep track of literally everything you spend money on and see where you can but back.

I've got a spreadsheet where I keep track of where I've made savings (e.g. cancelling Sky tv & going to a cheaper broadband supplier, changing my gas & electricity supplier, buying cat food in bulk, not buying bottled water, changing to a bank account with a higher interest rate, putting 25% of any pay rise or tax cut into savings etc.).

Last year I managed to cut my spending by several thousand pounds which is amazing to me as there's nothing really huge on the list but it all just adds up

I thought with snowballing you started with the debt with the highest interest rate?

Yes snowballing is as above, or sometimes you choose the highest rate one to overpay rather than the smallest. There are some good calculators online where you put all your debt in and it tells you what to pay first etc and then you can update it each time you make an over payment to see how many months you've knocked off your final date

One thing you can do is this: every night round down your balance to the nearest ten pounds and send the difference to a savings account (maybe for Christmas?) So if you have £556.32 left in your account tonight, pay £6.32 into savings. Do this every single day.

You need to cut back on non essentials. You don't need eyes brows doing or dog grooming. Even make up, just get some cheap mascara and BB cream if you really feel you NEED it. Do all hair cuts yourself. Don't buy presents for anyone except kids bdays and Christmas. You don't need to spend money at halloween! Get rid of any extras like paid for T.V. Look at all utilities and go with the cheapest.
Get a 0% credit card and transfer some of the debt.

See that’s what the spending account is for in general but we don’t buy all of those things every month, last month the whole £100 went on 2 haircuts and a new car seat
We have massively cut back on general spending DP in particular is a fritterer so he doesn’t have access to this account at all, there was one month when he spent over a grand and had absolutely no idea what on and had nothing to show for it
I haven’t had my hair done in years, get my eyebrows done every 12 weeks which is a tenner, replace about £20 of makeup every month and none of my clothes fit because i haven’t replaced them in so long

Do you all think £100 a month is a lot for a family of 6?

replace about £20 of makeup every month

While having £25k of debts?!

You've seriously got to review what you're spending !

Liz saving money on food wouldn’t really help as that money goes out on SO regardless, so some weeks I’ll be under budget but some weeks we’ll need lots of toiletries or there will be a good offer on nappies or something and it means I can stock up, without budgeting to the penny
It also means there is always money available for food and we don’t have to put something up for sale on Fb to go food shopping that week (yes this has happened before)

The same with transferring what’s left each day - there isn’t any changes because we don’t touch the bank account that money gets paid into at all, only spend on either the occasions, spending, or groceries account

I thought this would help us categorise and prioritise - Is this the wrong approach?

Oh that was supposed to be every 3 months on makeup, not every month

£20 a month on make up plus dog grooming and eyebrows when you are in 25k debt! . Half the occasions spending to £50 and Halloween and Easter shouldn’t cost anything other than £1 each for children’s Easter eggs.

Why does food money go out on Standing Order?
What shops are you buying your food and toiletries from ?

You've literally got to question everything you're currently spending money on and budget to the penny to figure out where you can make savings, so that you can clear your debt.
Once your debt is gone, it'll be so much less stress for you.

I've got to dash out now but I'll try and find the relevant MSE links later and post them if nobody else has.

How much are your debts (in terms of payments per month)? Do you rent or have a mortgage? How much does your husband take home and how much are your bills? Sorry for all the questions but there might be things you can cut back on.

On MSE I've seen people post all their outgoings and people make suggestions as to what can be cut.

£20 every three months on makeup - it was a typo!
And I didn’t say I did spend more than £1 on Easter eggs did I?

With those debts I'd definitely knock the eyebrows on the head. Tweezers, and if you simply must dye them (I'd say not necessary) then a kit from boots is about £7 and will do several applications.

As for the make up... yeah no seriously, that £20 can be cut. Wear it a quarter of the time that you do now, or quarter the number of products, or quarter the brand level to superdrug own, primark or poundland. Look for it on eBay, I spent £10 instead of £55 on a full face kit I love just by glancing on there before I went ahead and ordered. A fiver a month on make up would be much more reasonable to me in your shoes.

Your DH's spending is, of course, much more of an issue. I'm glad he doesn't have access to that account. Can you get in the habit of sitting down at the end of the day and counting how much you've both spent each day?