Any hope for me

strewthelvis

hi all, am feeling slightly hopeless today. Have been with my partner 8 years (might be important) and we have a baby. We have been renting various houses (3) since the beginning of our relatikonship and now i just really want someplace to call home.

I earn 35000 a year, he hasnt worked for the past year and isnt entitled to unemployment as we live together. I have a stupid credit card debt of 4,000 thats been following me around for years i keep ploughing money into it but it dosen't seem to be getting any smaller, i also have a personal loan that has is down to just under 3000 now.

I cannot seem to save anymoney, i dont smoke, we dont drink in fact we dont go out at all but still we just seem to manage to survive on my pay, it seems to be cut in half by the time i actually get it between tax and levies and pension.

We do our shopping in aldi or lidil and always just the basics, have to pay rent, oil and esb and solid fuel, we have one car with tax and insurance due soon. I just cannot see a way to save money or cut back on costs, i cannot see a way of ever owning our own home.

Everyone says rent is dead money you should get a Mortgage but you can't get one of them without having savings. It amazes me sometimes when i read on this site things like saving of 50000.

Basically i just want some free financial advice as i cant seem to sort myself out at all

coylemj

You're in debt and want some money advice, that's precisely what the Money Advice and Budgeting Service (MABS) is there to do. It's a Govt. agency so they will not try to sell you a different credit card or steer you to any particular bank...

http://www.mabs.ie/

The website has a 1890 number but if you have a bundle with a certain number of minutes call time on a mobile phone you can call them on 01 8129350 to avoid being charged separately - 1890 calls don't come out of your monthly call allowance and are charged separately.

Howitzer

I'm just passing through and saw your posr. Would downsizing your car to 1litre engine to save tax and insurance be any help i wonder. All i can think of at moment. Keep on going as best you can

PaulieMac

Hey,
The trick is too keep track of everything you spend for a month. I use to be really bad with money. I was never reckless but it just seem to go. You crazy getting a mortgage now because the price of houses will keep falling and falling for years to come. The market in Ireland will be gone for a while. The banks are not lending simple as. Join a credit union and consolidate the loans. Credit cards are the killer. Maybe ask for a break on paying your personal loan and concetrate on the credit card because of the massive interest. Your partner needs to get some type of a part time job. You cant do it on your own
Regards

strewthelvis

thanks all, PaulieMac i appreciate your advice re getting a mortgage and joining a credit union which is something thats next on my list. At the moment my partner is a house husband so to speak and im really glad he is out baby is only nine months and glad its her dad thats minding her, but he is on the look out for a job and hopefully it wont be long till something turns up, its not good for his moral been at home if noting else. He wants to be the provider but its just not an option at the minute.

PaulieMac

I didnt realise he was a house husband. Our little one is 9 months as well. Herself went back to work and we are no better off between fees and time frames. Its all madness.

manatoo

strewthelvis wrote: »

hi all, am feeling slightly hopeless today. Have been with my partner 8 years (might be important) and we have a baby. We have been renting various houses (3) since the beginning of our relatikonship and now i just really want someplace to call home.

I earn 35000 a year, he hasnt worked for the past year and isnt entitled to unemployment as we live together. I have a stupid credit card debt of 4,000 thats been following me around for years i keep ploughing money into it but it dosen't seem to be getting any smaller, i also have a personal loan that has is down to just under 3000 now.

I cannot seem to save anymoney, i dont smoke, we dont drink in fact we dont go out at all but still we just seem to manage to survive on my pay, it seems to be cut in half by the time i actually get it between tax and levies and pension.

We do our shopping in aldi or lidil and always just the basics, have to pay rent, oil and esb and solid fuel, we have one car with tax and insurance due soon. I just cannot see a way to save money or cut back on costs, i cannot see a way of ever owning our own home.

Everyone says rent is dead money you should get a Mortgage but you can't get one of them without having savings. It amazes me sometimes when i read on this site things like saving of 50000.

Basically i just want some free financial advice as i cant seem to sort myself out at all

Hi there

Firstly my sympathies to your situation but if it's any consolation there are many many people out there with similar or even worse situations at the moment so it's important to remember you're not alone.

There are many things you need to do to improve your cash situation but without giving a full personal finance plan, the three most important things above all else are the following

1) As mentioned above, you need to monitor, plan and then budget your income/expenditure.

First of all -monitoring - take a sample period of a week or two and during this time, write down and keep receipts for every little thing you buy or pay. This means expenditure as large as say your ESB bill and as small as a packet of chewing gum. Make sure your partner does the same. Similarly, record your full household net income across that time. Ensure everything is taken into account - salary, child allowance, etc.

The planning phase will involve looking back at your record of expenses paid and identifying areas where money can be saved. You mentioned you don't smoke, does your partner? Whatever about rent, this is certainly dead money if so. Other areas you may see potential savings are fuel costs (are you driving when you could walk/cycle), clothes - can you shop cheaper, ESB - are you efficent in how you use your electricity and so on. When you have identified savings in specific, categorised areas of expenditure, (entertainment, food, car, ESB etc) move onto the budgeting phase

The budgeting phase involves taking a new sample 2 - 3 week period and using the newly identified expenditure amounts from the planning phase by category adjusting your expenditure in each category downwards to this amount.

The most important points of this process are that a) You are realistic about what savings can be made using this plan. If your newly budgeted expenditure is unrealistic your plan is doomed to failure. b) You must allow breathing space, ie leave some room in your plan for entertainment so that life continues to be enjoyable for all involved. Budgeting doesn't mean that you have to spend nothing, it just means reducing costs in readily available ways to allow for a continued standard of living just in a slightly modified way. Simple example - rent DVDs instead of visiting the cinema. c) And most importantly - STICK TO THE BUDGET!! No matter how small an overspend in a category may be, it will lead to diverging from the plan over time so make sure all involved rigidly stick to the plan!!

2) Debt improvement.

You identified 7,000 of debt which you are carrying at the moment. This is not at all an unmanageable amount so don't be demoralised about it. Again there are people with lower incomes than you who carry far higher debt! What is important however is the debt structure you appear to have. Let me make one thing perfectly clear. THERE IS NO MORE EXPENSIVE WAY OF BORROWING MONEY THAN CREDIT CARDS!!! Without details of the credit card deal you have I can't tell you the amount you are paying in interest on this loan but it is likely to be somewhere in the 14%-19% APR range. This means for every year you keep your €4000 debt on your credit card you are paying €560-760 annually just to service interest on this. At the end of the year you will still owe the full €4000 and the same interest amount will need to be paid the following year. This needs to stop immediately.
My advice would be to do one of two things. Preferably, if the credit card issuer is a bank and even more preferably if it is the same lender with whom you hold the personal loan, you need to ask them to lend you a further 4,000 to cover the full amount of the credit card debt. This is called debt consolidation. The benefits of this will be twofold. Firstly, a personal loan is usually around 11% APR so you will instantly save almost 40% of the amount of interest you are currently paying to service this 4,000 while it is on your credit card. Secondly, a personal loan is repaid in scheduled, pre-determined monthly repayments so you will always be repaying at least some of the capital debt as well as the interest.

Your second, less preferable option here in the event that the above is not an option because the personal loan lender will not increase your loan amount is to negotiate a revised payment plan on your personal loan extending the period to allow excess monthly cash to pay down your credit card. You must repay your debts in order of the most costly (highest APR) first and anything you can do to redirect cash that is currently being used to pay lower interest loans towards repaying higher interest loans (credit card debt) is what you must do.

Lastly, you mentioned your partner is not working and does not receive welfare payments because you are living together. You didn't mention what skills he has or what he previously worked at but if he has a trade skill (carpenter, electrician etc) he should get some paper fliers printed and distribute them around your local housing estates and shops in the area looking for nixers and odd jobs. If he doesn't have a trade then he should be spending a few hours every week asking around every local petrol station/corner shop/warehouse etc. Very often with jobs like these it's a matter of being in the right place at the right time when they need someone. Employers in these sectors don't tend to hold CVs in queue order and review when needed! If parents/friends are available to take on any child care that he provides at present for just a few hours a week while he works it would be hugely beneficial. Any income he can generate, even a couple hundred euro a week will make a huge difference to your budget.

Without having access to your current income/expenditure budget etc I can't advise much further. There are many many many areas that you may need to look at further such as tax and welfare (are you receving every tax credit you are entitled to and are you claiming every benefit?), accommodation (are you renting a bigger property than required?), car (could you sell up for a cheaper model and realise some tied up cash or better still, get rid of it completely?) and so on but I guarantee you if you follow the above three points completely you will find a dramatic increase in your financial position quite quickly!!

Hope this helps and keep positive!!

eagle_i

You’re best option is to immediately arrange an appointment with MABS, you need clear and concise advice on how to control your current debt (cc and personal loan) and more importantly reduce/clear that debt asap. MABS will also give you advice in respect of social welfare entitlements for both you and your partner, aswell as setting out an expenditure and saving (where possible) plan/budget to suit your circumstances.

I don’t quite understand why your partner is not entitled to some form social welfare assistance. Living with a person is not sufficient grounds to refuse unemployment benefit on its own, other factors would have to influence the refusal, such as income. TBH your income level should not have a huge bearing on this decision too, as it is just around the average industrial wage. If he is out of work for less than 12 months he has entitlement to Job Seeker Allowance – that is unless he was previously self employed then he unfortunately falls into that big black hole called ‘You’re on your own, baby!’ The fact that he is caring for the child would indicate to me that at the very least he should be entitled to the Carer’s Allowance. Talk to MABS and see if you have grounds to appeal.

This will not satisfy your desire to purchase a home over night but should put you on the right road to achieving that goal in the future. You should look into the ‘Affordable Housing Scheme’ in your area, find out what the criteria is to qualify and submit an application. But first off you need to reduce and clear your debt.

Depending on where you live you could be waiting a while for an appointment with MABs, in the meantime you should keep a spending diary, which will greatly help MABS in assessing your position. The spending diary needs to be honest and account for everything down to chocolate lolly for the little one. The spending diary should be kept for at least a month, but ideally a 3 or 4 month period to give a complete picture of your spending habits.

drunkmonkey

Move your credit card to one that will give you interest free for 9 or 10mts, this will give you a chance to attack the capital instead of just paying off interest. If you don't have it paid off in 9mts move it again for some more interest free. Do this today and you'll make a saving straight away.

strewthelvis

thank you all, you have me feel so much better about everything. I really appreciate it and will follow all your advice.

rainbowtrout

eagle_i wrote: »

You’re best option is to immediately arrange an appointment with MABS, you need clear and concise advice on how to control your current debt (cc and personal loan) and more importantly reduce/clear that debt asap. MABS will also give you advice in respect of social welfare entitlements for both you and your partner, aswell as setting out an expenditure and saving (where possible) plan/budget to suit your circumstances.

I don’t quite understand why your partner is not entitled to some form social welfare assistance. Living with a person is not sufficient grounds to refuse unemployment benefit on its own, other factors would have to influence the refusal, such as income. TBH your income level should not have a huge bearing on this decision too, as it is just around the average industrial wage. If he is out of work for less than 12 months he has entitlement to Job Seeker Allowance – that is unless he was previously self employed then he unfortunately falls into that big black hole called ‘You’re on your own, baby!’ The fact that he is caring for the child would indicate to me that at the very least he should be entitled to the Carer’s Allowance. Talk to MABS and see if you have grounds to appeal.

This will not satisfy your desire to purchase a home over night but should put you on the right road to achieving that goal in the future. You should look into the ‘Affordable Housing Scheme’ in your area, find out what the criteria is to qualify and submit an application. But first off you need to reduce and clear your debt.

Depending on where you live you could be waiting a while for an appointment with MABs, in the meantime you should keep a spending diary, which will greatly help MABS in assessing your position. The spending diary needs to be honest and account for everything down to chocolate lolly for the little one. The spending diary should be kept for at least a month, but ideally a 3 or 4 month period to give a complete picture of your spending habits.

You don't get the Carer's Allowance for minding your own child. You only get it for minding a person that is disabled or incapacitated in some way and they must be over 16. i.e. someone who is not able to live their lives independently without some form of help.

eagle_i

rainbowtrout wrote: »

You don't get the Carer's Allowance for minding your own child. You only get it for minding a person that is disabled or incapacitated in some way and they must be over 16. i.e. someone who is not able to live their lives independently without some form of help.

Right ye' are, RT! That should have been the Home Carer's Tax Credit, then again you have to be married to qualify for this!

Bill2673

The credit card debt really stands out.

Who is it with?

Is it with AIB or BKIR?

I would consider going to your credit union, borrowing €4,000 from them to pay back the credit card debt. The interest rates will be much lower. (please note, I'm assuming credit unions have the lowest interest rates. get your bf to go to all the local banks and credit union, with baby in tow, to find out who has the lowest rates).

When that credit card loan is paid off, rip up the credit card, never use it again.

The other thing I would do is get your mum or his mum or your sister or whoever to come over and stay for the night, and go to the movies.

Keep your chin up. You have a lot going for you though it might be hard to see it right now. First year of little baby's life is hard work. Its a joy, but its a strain also.

Don't get too hung up on 'a place called home'......lots of people have a home/ house they feel trapped in because of the mortgage......grass is always greener on the other side. I have friends in Germany who would never dream of buying a house, wouldn't make sense to them. its not their culture. My point is, you don't need to buy to have a home.