A new partner and new start in life. New SOA...

A question about : A new partner and new start in life. New SOA...

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 0

Monthly Income Details
Monthly income after tax................ 900 1080 - edited to show a higher withdrawal rate from business account
Partners monthly income after tax....... 1500 200 - Partner's contribution to household expenses.
Benefits................................ 0
Other income............................ 600 (gross rental income from my house)
Total monthly income.................... 1880

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 166
Electricity............................. 77
Gas..................................... 0 - Included in above it's a dual fuel bill
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 30 - Includes internet
Mobile phone............................ 10
TV Licence.............................. 13
Satellite/Cable TV...................... 33
Internet Services....................... 0 - Included in landline
Groceries etc. ......................... 325
Clothing................................ 10
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 45 - Walking, taxis and buses for me. I don't drive.
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10 - (estimate)
Pet insurance/vet bills................. 0
Buildings insurance..................... 15
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10 - (estimate)
Haircuts................................ 5 - (estimate)
Entertainment........................... 130 - Ј30 per week sounds about right
Holiday................................. 65
Emergency fund.......................... 0
Legal costs............................. 300
Partner Misc expenses................... 1300 - Partner will not participate in the SOA exercise the average spend is about Ј300 per week on all other expenses to do with partner and child only including savings, travel, mobile, clothing, dental, haircuts, presents, holidays, outings, insurance etc.
Letting Agent........................... 58
Total monthly expenses.................. 1327

Assets
Cash.................................... 450005000 - Emergency fund
House value (Gross)..................... 145000 - Value of my house which is rented out.
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 190000

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly.. .APR - All are my own personal debts
Sainsburys.....................15505.....443...... 4.1 (35 months to go)
Halifax Loan...................12980.....295......6.9 (44 months to go)
Halifax CC.....................1960......19.6......0
Santander CC2 0% Purchases.....1450......14.5......0
Barclaycard....................4640......46.4..... .0
Capital One....................369.......5.........3.9
Santander CC1 0% BT............4160......41.6......0
Total unsecured debts..........41064.....865.1.....-

Monthly Budget Summary
Total monthly income.................... 1,880
Expenses (including HP & secured debts). 1,327
Available for debt repayments........... 553
Monthly UNsecured debt repayments....... 865.1
Amount short for making debt repayments. -312.1

Personal Balance Sheet Summary
Total assets (things you own)........... 190,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -41,064
Net Assets.............................. 108,936

Created using the SOA calculator at.
Reproduced on Moneysavingexpert with permission, using other browser.

Ј900 per month profit is my average net profit from self employment after work related expenses and it is highly variable gross income ranges from minimum of Ј100 per week to maximum of Ј600 per week. I use a business account to buffer the income and draw around Ј225 per week from it and transfer it to my current account. The remainder stays for tax, national insurance and any work related expenses such as computer repairs/upgrades, business mobile, printing supplies, travel costs etc... If no income was generated I could continue to draw the money for up to 3 months before it runs out. It's also an emergency fund which I feel is required.

Ј1,500 Partner's income is an estimate of partners child support received Ј1,200 per month, child tax credits of around Ј50 per week and child benefit of around Ј20 per week. Partner does not work.

I own a house with no mortgage which I let out for Ј600pcm as I have moved into my partners house. The income goes straight into my current account every month and covers the Sainsburys loan which I took out to bring it up to an excellent letting standard and refinance some other debts. I do not want to sell it. It has expenses that are fixed such as buildings insurance and agency costs and some things I have not taken into account in the SOA such as annual gas safety certificate/boiler service and house maintenance which could be anything really.

Basically, we go halves on the council tax (Ј83 a month each), I pay for the groceries (around Ј325 a month for 3 people) and partner pays the bills for the house (around Ј200 a month).

I have a personal legal issue (don't worry it's just a civil case nothing criminal) that I make payments of Ј300 a month towards (at least 6 months remain..could be more). Legal aid is not available. It's not a debt it's an expense. Proceedings haven't started yet and don't look like they will for at least a year. It's very slow progress and very annoying.

The Ј45,000 of cash isn't all mine...it's mostly my partners from a divorce settlement. It is not going to be given or lent to me to pay off my personal debts. My share of the cash is around Ј5,000 which is an emergency fund as explained earlier.

As you can tell my partner gets a lot in child support and has been used to spending or having a lot more money around than now. Based on the child support payment received I estimate the partners ex is on around Ј150,000 per year. I am nowhere near the same earning level and we are arguing a lot about money. A lot of the arguments are along the lines of me not having the money to go out which I don't especially in the weeks in which I only get the minimum Ј100, my partner refuses to pay for me and to make it clear I don't expect to be supported as a working adult from what is effectively money given from an ex partner for the support of a child...What do I do? The child is 16 and this money will only come in for another 3 years before it stops and I would be supporting the household with my income only. I'm hoping by then the Sainsburys loan will be clear and the legal issues all resolved so it should me much better soon although I think I'll be in a bit more debt.

I don't think there is anything I can do.

I've been using a credit card to purchase nearly everything and using my income to make the minimum repayments.

I don't want to go onto a DMP as I'm hoping to get a mortgage and buy a house together when the daughter moves out at which time the house can be let out giving my partner some sort of monthly income.

It was all much easier living in my house and visiting each others homes every few days but living together as a couple should save us both money in the long run.

Best answers:

• As much as I hate to say it, your partner's expenses are crippling you. And there's no way for anyone to figure out how to cut down if we don't know where it's going.
  Other things - entertainment - what does that involve?
  Groceries - you could cut down there. We spend approx half of that and there's two adults and a toddler so even with a teenager it could be cut down.
• you have 45000 cash ? why not pay off your debt with that ? You're supposedly a debt free wannabe with liquid assets of 45000 ? I feel like im in the twilight zone.
• Only Ј120 a year on presents, for your child, partner, friends and family...... really?
• PS..... OP your business isn't even making you the equiv of a FT minimum wage job. perhaps it's time to consider another way to provide yourself with an income?
• hi, think communication as well as the money may be an issue.so,
  in three years when child support stops, the partner will expect you to support him/her? why would they not get a job themselves?
  I'd definitely keep hold of your house, just in case you need it.
  The SOA is muddling to me. Do you keep your two finances totally separate, and you just contribute the food and council tax?
  If OH income doesn't "go in the pot" you may as well just do a SOA as if you are a lodger, just put your income, and the Ј83+Ј325 as your "rent" ,may make it easier to see the wood for the trees.
  Have you tried speaking to a debt charity at all?
  are you continuing to use the credit cards to meet the shortfall every month?
• Have you shown your SOA to your partner so that she can appreciate the predicament you are in.
  It's fair enough that the child support is going toward support her and her ex's child, which you both seem to acknowledge. Has she given any thought as to what will happen when the child support, tax credits and child benefits dry up. Can she realistically expect to get a job that pays her the same net amount each month or will she be expecting you to support her?
  Money is a very emotive subject and I can see why it causes so many arguments but the bottom line is that you can't afford this current lifestyle and your debts. Really you should be living together because you want to live together, not because it should save you money in the long run.
  Using your credit card to pay for everything and then just making the minimum payments each month is financial suicide. Destroy the credit card! Is the fact that everything goes on this credit card the reason you won't shop at Aldi?
  The job offer sounds like a good idea but will it really cost you almost Ј25 a day in travel? That sounds like a lot, could it be reduced using a season ticket?
  Would you be able to take the job and still do whatever it is you do for other clients freelance?
• another thought- what about "downsizing" the house you own?
  value of house Ј145000, sell up, pay debts of Ј41000, buy a property with what's left, that you can rent out.
  (and move back into when oh won't get a job in 3 years...)
  the job offer sounds promising-if you cannot drive, and public transport is so expensive, if cycling isn't an option, what about a moped? very cheap to run.
  Or advertise to see if someone travels that way anyway and you could pay them to take you along?
• Selling your house would be an extreme fix, but unless you can balance your incomings and outgoings, it might end up there.
  Not sure if your SOA is up to date since you corrected it;
  Council tax............................. 166 (should this be halved?)
  Telephone (land line)................... 30 (does partner pay for this?)
  Water rates............................. 25 (does partner pay for this?)
  TV Licence.............................. 13 (does partner pay for this?)
  Satellite/Cable TV...................... 33 (does partner pay for this?)
  If these changes should be made to the SOA, then your outgoings (excluding debts) are up to Ј184 less than Ј1327, so Ј1143.
  Income is Ј1880 which leaves Ј737 for debt repayments.
  Now I'm hoping that this is a more reflective summary.
  Monthly Budget Summary
  Total monthly income.................... 1,880
  Expenses (including HP & secured debts). 1,143
  Available for debt repayments........... 737
  Monthly UNsecured debt repayments....... 865.1
  Amount short for making debt repayments. -128.1
  ~
  You still have a shortfall, so you need to save at least that Ј128.10 a month, though more as you mentioned there are things that are unaccounted for.
  The only things that I can really pick out are the following;
  - if you can get your grocery spend closer to Ј225 (aim for Ј50 a week as a start, which should be easily doable and there is plenty of advice on the DFW and OS boards to do that and more)
  - if you cut out new clothing
  - reduce your entertainment spend by half, look for free/cheap/special offers etc.
  You could save ~Ј140 a month (~Ј1700 a year) and get your SOA back into a positive balance in the process.
  I would also consider cutting out the holiday spend completely to save Ј800 a year.
  ~
  At a push, and if you make sacrifices such as this, you could be debt-free in around 6 years. If the legal expenses stop next year, and if you use some/all your emergency savings in the meantime against debts, you could do it in 4.
  It won't be easy, but it is possible.
• I put Ј200 as my partners contribution to the household expenses so if I halved the council tax and removed what she pays for I'd have to remove the Ј200 figure as well. My income is Ј1,080 plus Ј600.
  There is another problem...she claims tax credits as a single person and refuses to contact HMRC. I think she's scared she'll lose the money. If she lost the tax credits because I moved in I'm sure she'll want me to give what she lost to her. Would HMRC have any comeback against me to repay the money? I'm not on the claim.
  The council knows we live together and have stopped the 25% SPD.