Money, money, money

[stonybroke]

Hi there - could really do with some advice, opinions, experience! I have changed my name (what a wimp!) as I am too embarrassed to use my normal name. I am even nervous as I type, as I know some will wonder how we got in this mess.

Anyway... the subject is AGGGHHHHHH MONEY! We are in a major, and I mean major, mess and we have worked all weekend on figures trying to work out the solution.

I don't have the exact figures with me but the situation is:

We owe £30,000 on credit cards, personal loans, car loan.
We own our house through a shared housing scheme, where we have a mortgage for half and rent half. The equity is only around £8,000. Property prices don't go up very much where we live approx. £2,000 per year. Our mortgage is £31,500

We need a new roof, we only have two bedrooms and now need additional one with dd's arrival. We could convert our room into two bedrooms for 2 kids and we move into ds room. Our garden needs major work done - it is a big old concrete jungle.

We earn about £26,000 between us. I work parttime, childcare is £75.00 per week.

Anyway there lays bear the facts of the situation - scarey eh? We do not live lavish lives - don't buy many clothes, have had one holiday in 10 years, etc. I stayed at home with my ds for 3 years and that is where the problem began. We also bought our first house in the sticks which turned into a major mistake.

The figures this weekend showed that we get into debt every month just paying for our household bills and loan repayments. That leaves nothing for clothes, going out, christmas, birthdays, etc. No extras of any shape.

The option we think my be the one to go with (even though I am a avid watcher of Alvin Hall and he says never to do this) is to consolidate over 25 years (if we would even be accepted for this?) In theory this would reduce our monthly repayments from approx £750 to aprox £260 or thereabout. That at least would mean we would have some cash for clothes, school fund, christmas, etc.

Anyway, I think that is the details. I am shaking as I type this. Please Please any sound financial advise would be very much appreciated! I am off to the ladies to have a cry.

Good job Stonybroke! Look at the progress you've made since this morning! You're really inspiring! : )

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Well done stonybroke! Progess indeed. If you want a spreadsheet template with income and expenditure calculations you're welcome to mine, I'll just take all my figures out and let you have a blank one with the formulae. It has colums for all outgoings (you might need to add some) and income and then calculates the monthly surplus/deficit. You don't have to tell me your name but if you want it my hotmail account is wickedwaterwitchy at symbol hotmail dot com. You need Excel to use it but you wouldn't need much knowledge to plug the figures in.

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berries - the babysitting is a good idea. I couldn't cope with standing in a shop but babysitting is definitely something that would appeal. I might put an ad up in the local newsagents.

robinw - my dh is not the most balanced person in the world - always tripping over his own feet, dropping dishes when washingup (don't think its to get out of it!!)! I had thought of the moped idea before, because the trip to his work would be much quicker than bus (it goes a very very long way round and only has one in morning and one at 5pm) but his mother even said that it is the one thing she would never like to see him do! His other brother has a very powerful motorbike, so she's not against them, just him.

Oh my God, this is really really wierd - dh just phoned - his car has exploded! This has never happened before, always been a really reliable car - had it for 2 years. Do you think it knew we were going to get rid of it?! dh is very stressed and upset about it - told him it is fate and all that, but I think this is just final straw for him and he is very very uptight. Better go and ring the scrap yard. Poor dh - looks like he's on the bus sooner than expected.

re the babysitting - agency babysitters only get about half what the client pays AFAIK (a friend used to use one on a weekday morning, she paid c £6 an hour and the sitter definitely only got about £3) - unless berries uses a very upmarket agency! You would probably make a lot more arranging it yourself, in fact our HV used to act as a kind of agent and organise older mothers' teenagers to sit for younger mothers' babies, you could ask yours if she knows anybody who needs a sitter.

Great that you have got so far already, stonybroke - good luck with CAB - sorry about the car though, a bit of a shock for your DH! Might he be able to get a lift off somebody, if he goes somewhere lots of people do, instead of using the bus? He could put cards up on supermarket noticeboards offering to pay for petrol? Or take turns, using your other car some of the time?

Re baby-sitting fees - I used an agency a couple of months ago - the sitter got £5 per hour, mimimum fee £20, the agency got £4 per hour on top plus VAT. Very expensive, but at least the sitter got a reasonably worthwhile fee.

Just had a thought ... Microsoft do a Money program (we got it free with our computer when we got it) and it is so helpful. I am able to keep a tab on our day to day finances really easily with it ... and it reminds me about up coming bills/ automatically puts in anything that I have as direct debit, that sort of thing. All I do is every weekend I sit down for half an hour and put in everything that I have spent that week (including cash withdrawals) ... It really is a great program and we are now so much more on top of our finances ...
Might be worth getting something like that ...

Do you use your other car for work? Do you work at 5.30pm - maybe you could pick him up a few times a week, or he could have the car a few times a week to soften the blow...?
Well done with progress so far.

Try Sitters . I have worked for them in the past and got offered so much work, in the end I told them to stop calling me and that I would only sit during the week. I could have sat every night if I chose to! You get a guaranteed paid 4 hours, even if the parents are only out for a couple of hours. Several times I only sat for 2.5 hours but still got paid £20. It was geat when I wwas trying to get my college work done, as I knew that I could always find simething else to do at home. This way I had to do my work as I don't watch much TV.

Can't had any suggestions because DH and I are in exactly the same boat! Only thing is we rent, so no equity and savings of about £50!

Not trying to hijack the thread but the thing is that now we have 3-month old dd, I'm not working and my £400 a month is due to run out in a couple of weeks time, and we have to move due to the people who own our house wanting to sell. So I really need to get our finances sorted and work out ways of reducing the considerable debt we have already. It's nothing compared to some peoples but considering we don't earn much it's huge to us.

My problem is I'm sure I could sort it all out if I had all the figures but DH's has just started his own business and doesn't know what's coming in from week to week, and I'm still all over the place with my benefits and trying to sort it all out. Also, our bills never seem to be the same from week to week and we try to keep them as low as possible but I don't know how to control it all.

How would you do a budget when you don't know exactly what's going to come in and go out?

alibubbles, I just went to your Sitters site - thinking gissajob, I could do that! - and they are apparently only looking for "Registered Childminders, Nannies and Nursery Nurses."

Oh well.

I agree with Ghosty about the finance programme on computer.

We use "Quicken" weekly and we budget down to the last Mars bar receipt. It does seem a bit anal, but when money is tight, you do have to account for every last spend, including the "little" things.

When we do this, it means at the end of the month, we can see on screen if we've got enough for a take away for example. It's an incentive to keep track of what we're spending and it really does open your eyes when you have to justify your spending to each other. It's all about being accountable.

Wobblymum, if you don't know exactly you'll just have to estimate roughly what you think your income and expenditure will be. If you want to, you can then put in the actual figures once you know them so you can see how accurate your forecasting was and how much in credit/debit you are. Presumably most of the bills are roughly the same every month though? If they're not, you should still be able to work out a monthly average.

alibubbles - Sitters are not in our area. I think it has to be word of mouth and small ads for me! Although I definitely am going to give it a go. Thanks for the link.

wobblymum - poor you! You don't need this stress when you are pregnant. I would imagine (being the fantastic financial whizzkid - not!!! ) that you should base your budget on the very lowest possible income and then any extra would be a bonus. Good luck!

www - I have looked at that other thread and it is brilliant - managed to print half before our computer ran out of ink (off to cutprice computer store that sells cartridges for £4.00!). I went to the ivillage link and very good I thought. Am going to convert to reusable baby wipes today, using recently obsolete muslim squares. Also going to start using Lidl more! Just have to sort out the big stuff! Oh God will we ever get there. How are you getting on? Did you manage to keep going on the budgeting drive? How do you stay motivated?

We've been through this sort of thing this year - every month spending more than we earn (and am ashamed to say we're not on a really low income compared to some on here), building up credit cards after paying them off, etc. We've just remortgaged to consolidate all the debts (due to advice given by mumsnetters earlier this year). I, too have now set up a spreadsheet with monthly outgoings / income. This includes all our regular direct debits, as well as "one off" things that are occuring during the month (MOT, birthdays etc). What I then do is actually get out in cash all the things that are going to be paid out that aren't covered by direct debits - school dinners, childcare, swimming fees, etc etc, and put it all in different envelopes. OK, so you've got a bit of cash hanging around, but it's not in the bank making you feel more "liquid" than you really are, and you don't get to the end of the month realising that you've run out of money for things that you knew you were going to have to pay for. You have to be sure that a) you won't dip into it b) your dh won't dip into it and c) it's out of sight. I then work out how much is left over (income - outgoings), divide it by the number of weeks in the month and then dh and I have a set amount of cash each week to spend - once it's gone, it's gone. This all sounds a bit over the top, and quite old fashioned, but it's working for us - we're starting to only spend what we have, rather than the "oh well, something will come along" attitude that we had before. I never again want to build up credit cards and loans that get paid off by more credit cards and loans.
Wobblymum, I think you have to sit down and work out the bits about your budget that you do know (eg rent must be the same each month), and try and see if you can see a pattern for the things that vary. Can you pay utilities etc by direct debit? That way you pay a set amount each month, and you know what it's going to be - no surprises. Loads of people on here do a weekly plan for food shopping (not managed to be that organised myself, yet) - if you get into the habit of that, again, you may be able to see a pattern and budget accordingly.
Will try and think of some more ideas and come back later.

stonybroke, to answer your question about whether being frugal worked for us after that thread, err, no, not particularly brilliantly, although we're better than we were. I have stopped smoking and drinking (I'm pregnant) and I do try to think like a poor person - i.e. using up leftovers, making sandwiches rather than buying lunch when we're out, cutting down my mobile bill (down to about £30 from about £150 a month!), calling people after 6pm (don't always manage this), and when I'm buying things like shampoo only getting whatever's on offer. The upshot is though that we still can't afford to live on what we've got coming in so we're moving to where I can get a decent job with a decent salary. That way we should be able to clear our debts (manageable atm but still too big), buy a house and we'll still be better off. There was soooo much good advice on that thread wasn't there? It's a work of art!

Thanks for all the advice! I'm going to try making a rough budget now - just difficult at the mo!

Barclaycard is doing an offer with 0per cent on balance transfers for as long as it takes you to pay it off. There is a catch, you have to spend £25 a month on it. But if you use it for something you would have bought anyway (eg supermarket shop) and pay it off, plus some for the debt, you will have an endless0per cent deal. My dh is doing this with his credit card debt (not that big) but he is a very disciplined spender,

In a desperate attempt to save money and be more organised does anyone know where I can get cheap cards (birthday, blank, thank you) cards on the internet?

Why not make some, Ghengis?

Even if you're not very arty you can make something that looks nice simply by sticking something interesting looking (eg. textured or handmade paper from an art shop) to a bit of card. Cost about 20p.

Or potato prints are good - can't wait until dd's old enough for them!

In fact, it might be nice to get your kids to make some potato prints for the cards!

aloha, does that 0% Barclaycard thing work? We've been sent the offer 2 or 3 times but it seemed to me as if there was a catch - like, whatever you paid off each month would only be applied to the balance transfer, so the purchases would accumulate and then interest would be charged on them?

Do you have eg a direct debit for the minimum, to pay off the balance transfer, and then send them a cheque specifically for the purchase?

Janh, having read the application form and info, no, the only 'catch' is that you have to be quite disciplined not to keep spending on it! So if you spend the minimum to keep the interest at 0per cent - £25, you have to pay back at least £25 to stop your debt building up. The more you pay, the more you whittle away at the whole amount. This only works if a/you always remember to spend the minimum amount (not really a problem) and b/don't spend much more than the minimum amount (trickier if you are a spendthrift like me) and c/pay back more than the £25 you have spent so you actually tackle the debt.

Don't forget that credit card companies get paid a percentage by the retailer for each transaction, so they like you to use them, even if you pay the balance off in full each month.