Money Struggle

Toots

The short term debt is really what's crippling you here. Are the 2 credit union loans with the same credit union? If so, would they be able to consolidate the two into one loan and maybe increase the term, which would hopefully lead to reduced repayments. If all the other debts are with separate institutions, it's unlikely you'll get one to agree to take on the debt of the others. Any that are with the same place, see can you restructure. Are the cars on HP or was it an actual loan?

You're right about the cars being a huge drain, the tax is very high and so is the insurance. If your job is too far away to cycle, and the bus is too expensive, would it be worth looking at something like a moped or motorbike? My brother in law recently sold his car and got a moped and he says he's really noticed a saving. It would also mean that your wife wouldn't be left without a car on the weekend if you were in work. If you sold one of the cars, you'd likely have enough to get a decent enough moped/bike, and pay down the balance on the loan.

With the prescription meds, have you looked into whether or not you'd be eligible for a medical card or a GP visit card? I know it's small amount in the grand scheme of things, but it could lighten the load a little bit every month. I was 'technically' a bit above the income threshold but because I've got a condition that requires prescription medication that costs just under €100 per month, I was able to get a medical card for myself, and my husband was given a GP visit card.

LegacyUser

You can't buy more than one month's worth of prescriptions at a time to bring your total to over 144e. So you are stuck with the 86e per month I'm afraid. Unless you qualify for a medical card. You might get a gp card pn your incomes as they take rent payments into consideration.

Club55

batmanrobin wrote: »

I find it helpful to get out my bank statement and go through everything and see where I can cut back.

If it's weekly, €300 seems excessive for food shopping for 2 adults and 2 children. 8 of us were fed on €100. You just have to buy the cheap stuff I'm afraid. Get the brand of whatever super market you shop e.g if dunnes, but their label. Buy fresher ingredients rather than packaged foods. My shopping was halved by doing this. You could save yourself nearly €200 by doing this.

See if you can work out a smaller repayment on your loan. That's the biggest killer for you it seems.

You might have to think about cutting back to one car. It doesn't sound like you can afford 2 right now.

It's €300 monthly for groceries not weekly. My wife does a great job of budgeting and making her own items from scratch etc.

XsApollo

Your outgoings are pretty similar to my own bar the debt, 2 adults 2 young kids.
The only thing that is a bit high is the ESB bill , ours is about 60 a month ,are you on level pay for gas and ESB?
We pay 55 a month for ESB and the same for Gas.
It's perfect
No surprise big bills in the winter.

Have ye both mobile phones?
What are the bills like on them?
Also do you use the brodband much or just for browsing?
Could you use your phones for that and lose the broadband?

The debt is the problem , your outgoings arn't excessive.

bp

Taking a pizza/ take away delivery at weekends is a good idea or getting a moterbike or moped. Definitely cheaper to run although you would need to invest in good gear.

Could you look at switching credit cards, there used to be 0% interest on transfers which would really helps as the card will cripple you.

As the others have said call mabs, that is what they are there for, and talk to CU etc about extending the term your loan to get the credit card paid off faster

kirving

The elephant in the room here is the short term debt. No matter how much you save on food and really try to cut down, its 1/3 of your total income, with it and rent taking up almost 2k. Your rent seems very reasonable though.

You can cut down on the small luxuries all you want and be miserable, but the savings made will pale in comparison to what you could do if you restructure your debts. I wouldn't worry about what this may do to your credit rating. Buying a house is a few years down the line at the minute anyway, because you'll first need to save for a deposit.


If you're determined to pay off the debt as it is - look at the car outgoings.

As another poster asked, what are the makes and models of both your cars? Do they make up a significant portion of that 32k? The reason I ask is because until I added up what my car was costing me, I didn't really appreciate it. By getting the bus you'll save tax, insurance, repayments, diesel, servicing, unexpected repairs.

I know you say you want to keep the car for emergencies, but you can use a taxi here. If it's a serious emergency like an injured child or your wife is worried about something at home, it's time for an ambulance or the Gards anyway. You can also get yourself insured for very little extra to be insured on any car fully comp. You could then look at borrowing a friends or family members car when you need it in the knowledge that you're fully covered.

Mooooo

OP gather everything together. All income outgoings etc. Go to a couple of banks not just the ones you are with and apply for a personal loan over a minimum of 5 years. This would close on half your repayment figures and allow you to have extra to spend in a month and/or save. You'll be clearing those obviously expensive debt issues. In terms of the future for a mortgage then you will be paying a manageable loan, rent and if ye can put a couple of hundred away as savings it will all look better to banks in the future. One of the biggest problema with debt is people try to pay it off too fast and then get caught with unrealistic and unmanageable repayments. The 1200 a month would clear a 100k loan over 10 years that's how rediculous the repayments levels are for your level of debt

Mooooo

OP gather everything together. All income outgoings etc. Go to a couple of banks not just the ones you are with and apply for a personal loan over a minimum of 5 years. This would close on half your repayment figures and allow you to have extra to spend in a month and/or save. You'll be clearing those obviously expensive debt issues. In terms of the future for a mortgage then you will be paying a manageable loan, rent and if ye can put a couple of hundred away as savings it will all look better to banks in the future. One of the biggest problema with debt is people try to pay it off too fast and then get caught with unrealistic and unmanageable repayments. The 1200 a month would clear a 100k loan over 10 years that's how rediculous the repayments levels are for your level of debt

silverbolt

i dont think anyones suggested it bu can you combine the broadband with sky. Sky hav excellent broadband if they operate in your area?

PokeHerKing

OP do not cut back on anything else. You're already living well within your means and it's currently no life at all. It's just survival and it's admirable.

As has been said, consolidate your debt and that will give you some breathing space. Get it paid off in 3-5 years and then look at a mortgage.

You won't be punished by a bank for this. You will just have a loan history that you've been paying off for 3-5 years.

intheclouds

Club55 wrote: »

Rent €700 - ok
Debt €1200 - the best way to manage debt is either to consolidate it or organise it so the highest interest debts get paid down first. Can you break this figure out by amount and interest rate?
Childcare €300 - this is great!
ESB €100 - seems about right
Gas €60 - seems about right
Car insurance x2 €125 - this seems high, 3k car insurance for both of you for a year? Surely you can bring this down?
Sky TV €28
TV license €13.33
Contact Lenses €12.75 - I buy prescription glasses from zenni optical online for under 20 euro delivered - ive had the same pairs for years.
Car Tax €70 - a month? This seems very high? Can you downgrade to smaller cars?
Bins €24
Broadband €45 - sky AND broadband for 28+45 a month? I just have broadband and I watch whatever I want online.
Prescription Meds (unavoidable) €86 - can doc prescribe generic versions of anything? Can longer prescriptions be used?
Vitamins €8 - cheaper in LIDL
Groceries €320
Nappies €40
Diesel €260
Christmas Club €20

It occurs to me you can definitely cheapen the car situation by either getting rid of one car and one of you using public transport or cycling to work (or a job change) or downgrading the cars.

Another obvious solution here is for one or both of you to get better paid jobs.

Another thing I would consider is stopping payment on some of the debt and allowing it to go to a debt collector and agreeing to settle for a figure lower than the amount owed.

Also contacting some of the debtors and asking them to stop fees and interest on the debt or else you will have to stop paying and do above.

I dont know the split on the combined take home - but considering there are childcare and travel costs - it might make more sense for one of you to not work and then mind children in your home for money and eliminate a childcare and travel bill at the same time?

Mooooo

intheclouds wrote: »

Club55 wrote: »

Rent 700 - ok
Debt 1200 - the best way to manage debt is either to consolidate it or organise it so the highest interest debts get paid down first. Can you break this figure out by amount and interest rate?
Childcare 300 - this is great!
ESB 100 - seems about right
Gas 60 - seems about right
Car insurance x2 125 - this seems high, 3k car insurance for both of you for a year? Surely you can bring this down?
Sky TV 28
TV license 13.33
Contact Lenses 12.75 - I buy prescription glasses from zenni optical online for under 20 euro delivered - ive had the same pairs for years.
Car Tax 70 - a month? This seems very high? Can you downgrade to smaller cars?
Bins 24
Broadband 45 - sky AND broadband for 28+45 a month? I just have broadband and I watch whatever I want online.
Prescription Meds (unavoidable) 86 - can doc prescribe generic versions of anything? Can longer prescriptions be used?
Vitamins 8 - cheaper in LIDL
Groceries 320
Nappies 40
Diesel 260
Christmas Club 20

It occurs to me you can definitely cheapen the car situation by either getting rid of one car and one of you using public transport or cycling to work (or a job change) or downgrading the cars.

Another obvious solution here is for one or both of you to get better paid jobs.

Another thing I would consider is stopping payment on some of the debt and allowing it to go to a debt collector and agreeing to settle for a figure lower than the amount owed.

Also contacting some of the debtors and asking them to stop fees and interest on the debt or else you will have to stop paying and do above.

I dont know the split on the combined take home - but considering there are childcare and travel costs - it might make more sense for one of you to not work and then mind children in your home for money and eliminate a childcare and travel bill at the same time?

Stopping payment on the debt is badly advised if the op wants to attempt to buy a home in the future. Credit rating etc all effected as well as the fact if it's restructured it is affordable for the op.

intheclouds

Mooooo wrote: »

Stopping payment on the debt is badly advised if the op wants to attempt to buy a home in the future. Credit rating etc all effected as well as the fact if it's restructured it is affordable for the op.

Sure - dont disagree at all - we all have to make decisions and live with the consequences.

Club55

For the type of debt this is what we are looking at

Please no comments about how we shouldn't have gotten into this situation as we are already well aware of that. A lot of these are loans that we had before we met, and when you put them all on paper its scary, our main focus is trying to clear them and most importantly not get into any other debt

BOI Loan balance €1,319 - Repayment €85 per month
Credit union Me balance (stupid as a teen) €7,000 - Repayments €175 per month
Credit union Wife (college debt) balance €5,150 - Repayments €240 per month
Credit union Joint balance €3,193 - Repayments €120 per month
Debt Collector(debt thats over 10 years old, they have settled on €50 pm) €5,120
Loan for a car €8,886 -€228 per month-Can't sell the car have tried! 2011 mondeo
Credit card debt (historic) €948 - Repayments €119 per month
Current credit card €500 - Repayments €50 per month - never reduces balance due to interest
Family loan repayment €100 per month

Seems like an awful lot, bank loan and credit union loan taken out due to emergencies and poor health situations with up to 8 weeks in hospital with no pay so they were unavoidable

Car loan was a huge hit to us a few years back but we literally had no car as our older car blew the engine, i couldnt get to work and we couldnt gather a few thousand together to buy something so we went down finance route

I can't imagine that any bank in their right minds would give us a consolidation loan?

ted1

What's the debt collector one ? Was it a debt that was sold ? That could be one that you could ignore or settle for a much lower sum.

The J Stands for Jay

Phone up each of the companies you have debt with and ask if they can reduce the interest rates. I've done it myself in the past and it had no effect on my ability to get a mortgage.

Look into cancelling the sky TV subscription but keeping the box for all the free channels (most of what's on sky is available FTA anyway).

SarahMollie

Can you consolidate all the credit union debt and seek a better rate?

Also, prioritize getting rid of the credit card debt. Even though there isnt much of it, paying interest only is very expensive and gets you nowhere.

Would the family give you a break on your repayments until you have the credit cards cleared at least.

As for who will work with you - you just need to get an appointment with MABS asap. Theres just too many types of debt there to deal with on your own and it seems like you're inspiring.

SarahMollie

Club55 wrote: »

Seems like an awful lot, bank loan and credit union loan taken out due to emergencies and poor health situations with up to 8 weeks in hospital with no pay so they were unavoidable

Also, if something like this were to happen again, you should really seek a meeting with the community welfare officer (if thats what they're called) as there are likely some social welfare payments that could be appropriate in a case like this, instead of going straight to the banks.

Mooooo

Club55 wrote: »

For the type of debt this is what we are looking at

Please no comments about how we shouldn't have gotten into this situation as we are already well aware of that. A lot of these are loans that we had before we met, and when you put them all on paper its scary, our main focus is trying to clear them and most importantly not get into any other debt

BOI Loan balance 1,319 - Repayment 85 per month
Credit union Me balance (stupid as a teen) 7,000 - Repayments 175 per month
Credit union Wife (college debt) balance 5,150 - Repayments 240 per month
Credit union Joint balance 3,193 - Repayments 120 per month
Debt Collector(debt thats over 10 years old, they have settled on 50 pm) 5,120
Loan for a car 8,886 - 228 per month-Can't sell the car have tried! 2011 mondeo
Credit card debt (historic) 948 - Repayments 119 per month
Current credit card 500 - Repayments 50 per month - never reduces balance due to interest
Family loan repayment 100 per month

Seems like an awful lot, bank loan and credit union loan taken out due to emergencies and poor health situations with up to 8 weeks in hospital with no pay so they were unavoidable

Car loan was a huge hit to us a few years back but we literally had no car as our older car blew the engine, i couldnt get to work and we couldnt gather a few thousand together to buy something so we went down finance route

I can't imagine that any bank in their right minds would give us a consolidation loan?

The main thing banks will look at is repayment capacity. You are looking for 32k over 5 years. You are currently meeting those debts which have a repayment capacity of twice what you are looking for so I don't see why not. You will be paying back less than what you are now and less overall as there will be interest savings on credit card and possibly even credit union. If you wish perhaps ask someone you know/trust to give a hand putting everything together. Be confident going in to the bank don't go in saying your in trouble just say you are wishing to make things better from a cash flow point of view. If ye are secure in your jobs they should deal with you. If you don't try you'll never know

Club55

Thanks for your advice so far everyone, some points that I will be looking into for sure, every cent counts at this stage so every saving is a huge deal for us

It's just so frustrating as we are not entitled to rent allowance/council house as we are earning too much (€32k & 20k) but they don't take any outgoings into consideration

I am praying I get made redundant at work which would make me approx 20k which would clear an awful lot of debt, then hopefully i could pick up something locally and cut out one car (hopefully sell our cheaper car which would help clear another thing)... but this may never happen.

I am currently due a payrise and have been doing a job above my paygrade for 2 years now, they keep promising the payrise will come every quarter but I am starting to think it will never come now at this stage. I know the obvious answer would be to leave but then I lose the possibility of getting made redundant with 6 years service - Company is currently restructuring which is why I am holding out for redundancy

intheclouds

Club55 wrote: »

BOI Loan balance €1,319 - Repayment €85 per month
Credit union Me balance (stupid as a teen) €7,000 - Repayments €175 per month
Credit union Wife (college debt) balance €5,150 - Repayments €240 per month
Credit union Joint balance €3,193 - Repayments €120 per month
Debt Collector(debt thats over 10 years old, they have settled on €50 pm) €5,120
Loan for a car €8,886 -€228 per month-Can't sell the car have tried! 2011 mondeo
Credit card debt (historic) €948 - Repayments €119 per month
Current credit card €500 - Repayments €50 per month - never reduces balance due to interest
Family loan repayment €100 per month

See will the debt collector settle for less?

The current credit card - there is no point in paying and not reducing the balance - thats basically adding to your debt each month. I suggest you address that immediately and pay off the 500 (pay less on any of the other debt to facilitate this) and bring it to zero immediately. That then frees up 50 euro a month to go elsewhere AND it is a debt that is cleared. Perhaps tell the credit union you need a loan pay moratorium to do this. Cut up the credit card then.

Next tackle the historic credit card debt - either do similar to above and pay it off all at once while letting the other debt wait or substantially increase the repayments on it to clear it in 2 or 3 months.

Both of those debts are costing you the most in terms of interest.

The credit union - can the 3 debts here be consolidated within the credit union itself - they are the next to tackle - Ive no doubt the credit union charges high interest.

What is the family loan repayment?

fits

Yep if you could get the two credit cards off your back it would be a start. I would be looking for a pause in the other loans so you can clear those.

Club55

intheclouds wrote: »

See will the debt collector settle for less?

The current credit card - there is no point in paying and not reducing the balance - thats basically adding to your debt each month. I suggest you address that immediately and pay off the 500 (pay less on any of the other debt to facilitate this) and bring it to zero immediately. That then frees up 50 euro a month to go elsewhere AND it is a debt that is cleared. Perhaps tell the credit union you need a loan pay moratorium to do this. Cut up the credit card then.

Next tackle the historic credit card debt - either do similar to above and pay it off all at once while letting the other debt wait or substantially increase the repayments on it to clear it in 2 or 3 months.

Both of those debts are costing you the most in terms of interest.

The credit union - can the 3 debts here be consolidated within the credit union itself - they are the next to tackle - Ive no doubt the credit union charges high interest.

What is the family loan repayment?

Thanks for the advice, definitely going to tackle the cards first. They are both well cut up with a long time.

The family loan is a one off situation, my parents were in a bit of trouble and needed help so myself and my 4 sisters got a loan to dig them out (loan in my sisters name and we all equally contribute monthly)

intheclouds

Club55 wrote: »

Thanks for the advice, definitely going to tackle the cards first. They are both well cut up with a long time.

The family loan is a one off situation, my parents were in a bit of trouble and needed help so myself and my 4 sisters got a loan to dig them out (loan in my sisters name and we all equally contribute monthly)

How much is left on that one?

You definitely need to prioritise on the higher interest loans. The idea is you take your monthly amount that loans cost you (1200) and you make the smallest payment possible on the lower interest loans and then make as big a payment possible on the higher interest loans.

You can do it all out in a spreadsheet but the basic idea is to cut down on how much it is costing you to actually service the debt. A good example is your current credit card. Its costing you 600 a year to service that loan and you and not paying anything off the capital. Thats madness. That loan can be cleared in 1 month and that saves you 600 per year as well as the capital amount of 500 itself. There is NO point in just servicing debt without paying money off the capital.

So you take the highest interest loans one at a time and divert the maximum amount to paying them off and as you get rid of each one it is costing you less and less to service the debt which frees up more and more to pay off the rest of the debt.

On the car loan - what kind of a loan is that? Is it Hire Purchase? Could the half rule be applied here?

m'lady

I was just about to ask could the half rule be applied, but intheclouds has just suggested it. It might be an option op..

I would be wary about the advice about downgrading the cars. You are both driving an hour to work and need a reliable car. Buying something cheaper could be a false economy if you it ends up giving trouble and you have to pump money into it.

d-gal

Club55 wrote: »

Thanks for the advice, definitely going to tackle the cards first. They are both well cut up with a long time.

The family loan is a one off situation, my parents were in a bit of trouble and needed help so myself and my 4 sisters got a loan to dig them out (loan in my sisters name and we all equally contribute monthly)

Could you ask your parents/sisters for a loan of 500 and pay the credit card off immediately and then pay them back €50 a month? At least be no interest and it gets done.

Otherwise don't pay a few bills for one month and throw the money at the credit cards. The €50 towards the credit card bill is like burning money just for the interest. You'll feel a lot better if you get the CC loans done and dusted

d-gal

Club55 wrote: »

BOI Loan balance €1,319 - Repayment €85 per month
Credit union Me balance (stupid as a teen) €7,000 - Repayments €175 per month
Credit union Wife (college debt) balance €5,150 - Repayments €240 per month
Credit union Joint balance €3,193 - Repayments €120 per month
Debt Collector(debt thats over 10 years old, they have settled on €50 pm) €5,120
Loan for a car €8,886 -€228 per month-Can't sell the car have tried! 2011 mondeo
Credit card debt (historic) €948 - Repayments €119 per month
Current credit card €500 - Repayments €50 per month - never reduces balance due to interest
Family loan repayment €100 per month

Here's a breakdown of it OP that will hopefully help and put a plan together

9 loans
- 2 credit cards
- 3 credit unions
- 1 car loan
- 1 family loan
- 1 general BOI loan
- 1 debt collector

Credit cards have to go - immediately. €1448 required

Credit union loans total up €535 p/m currently. Go to the credit union and tell them you can only pay €300 - tell them your screwed and need to or you'll be missing payments. PUSH HARD FOR THIS. Tell them it's for one year and then you'll increase it up to €400-€450p/m. They'll 90% of time accept it - money in is better than no money at all. I know at least 5 people who've done similar. So with a bit of luck you'll save €235p/m.

Current credit card has €500 left on it. Pay €285 for 2 months and that should take care of that.

Next take care of the historic credit card. €948 left. Put the €285 (current credit card repayment money) plus €119 (current repayment) together. €404 now is going into the historic credit card. Less than 3 months and it's gone.

Now you have €404 to play with. BOI bank loan is €1319 (that'll be less in 5-6months). €404 plus your €85 repayment is €489. Again less than 3 months and it's gone.

So in less than a year you've 3 loans gone. Finished.

So you'll have a couple of months left before you increase your credit union repayment. So the €489 should be thrown in onto your car loan. €228 is the car loan. Total money you could repay €717 monthly. Do that for 2 months and then bring it down to €500 per month. You'll have that paid a lot sooner.
Now you could delay the BOI loan and prioritize the car loan but I find stress levels reduce when you've literally less loans to look at.

Al that's left after that is credit union loan and family loan. That's only 2 loans. A hell of a lot better!

You've €15000 roughly to pay the credit union. Realistically once you've gotten rid of your credit card and car loan debts then start throwing money at that.

This might sound crazy but if you put your mind to this then you'll be debt free in less than 3 years. That's without redundancy packages. Push for your wage increase, tell your boss you're struggling, you have to start asking people. Credit unions, family, employer.
Simply get to work OP, work your ass for it and you'll be happier and stress free a lot quicker. Best of luck!

Edit: About your wages as well. Both of ye are not getting paid great. If your wife is not holding out for redundancy (which it doesn't sound like it) then get her to quit her job and get a local job. Even it's less pay it'll still probably work out cheaper with selling the car, no petrol and no tax. She could still be insured on your car. Plus her commute would be shorter which means more time with her kids which every parent wants. Actions are needed OP, quicker the better

Double edit: you mentioned you've a 2011 mondeo that you can't sell. On done deal the worst mondeo I can see selling for is €5600. And that's the worst one remember. If your wife moved to a more local job you could sell that and clear your 2 credit card bills, your BOI loan and over 30% of the car loan in one go. That's a lot gone immediately. Or you could get rid of your wife's college debt credit union loan and then combine the remaining 2 credit union loans together and get a cheaper repayment plan. Loads of options right there.

Sound Bite

Op, there is a lot of scope here and opportunity to make things better.

Start with the credit cards, who are they with, for example if they are with BOI ask them to consolidate them into one and over a more manageable term. I'm not sure if they will consolidate all the other debt but it's worth asking.

If they don't want to take over all debt,you have 3 credit union loans - seek to consolidate them and again reduce your repayments.

Approach both with your spreadsheet, include a reasonable amount also for contingencies I.e. car repairs, doctors trips etc.

Even with the debt collector - write to them and advise of all the other debt - tell them you need to reduce your repayment by 100 per month to ensure you can continue to repay their full debt.

If you only managed to address the credit cards or consolidate other loans it would make a huge difference.

If all of the above is too much to do on your own, mabs will help you

jockeyboard

If your car loan is a hire purchase type isnt there a clause you can hand car back and loan is cancelled if it is after a certain amount of time???
Not sure of details but defo heard something like this before. Obviously you would be down a car but also the repayments/insurance/tax etc.

Sorry i posted before read all replies....