Borrowing from Peter to pay back Paul

S

S&TT

Guest
So first time to post a thread here and have to admit, the thoughts of setting out my financial situation in black and white is daunting to say the least. To put it mildly I feel I'm living on the edge as regards income and expenditure week to week. I think I'm doing what I can to keep my head above water but would appreciate any advice on how to make my situation any better.

I'm a single Mum living in rented accommodation. My income is €2,500 per month plus €160 child benefit. My outgoings monthly are rent €950, crèche €800, €100 insurance, AIB car loan €350 (€17k left - I consolidated a previous personal loan) this was originally €420 a month but I extended the term to reduce the payments, €200 towards credit union loan of €2,600, €150 MBA personal loan which I got to pay off two MBNA credit cards (6.5K left). I have an overdraft of €2,500 with AIB which is maxed constantly and an AIB credit card with a €2k limit which is maxed constantly also. I've applied to Tesco for a card so I can transfer the balance and hopefully wipe it clean within a year or so. Day to day expenses like groceries, petrol (I have a long commute!)etc. usually total €400 a month. Savings I have roughly €800 in the CU in case of emergencies. I receive maintenance sporadically which should be €100 a week however it cant be relied on and is never consistent despite court proceedings.

As a result when I get hit with big bills like home heating oil, car tax, even a new round of shoes etc for my son I never have the money. I try to budget but something always pops up and I end up borrowing from Peter to pay back Paul. Every month I sweat when I look at my bank balance and worry that I wont be able to cover everything, as I said any advice on budgeting or paying debts would be gratefully appreciated.
 
First thing that pops to mind is if you have a long commute and are renting could you try and find somewhere to rent nearer to work this would cut down on petrol, you might find a cheaper accommodation and creche so that would all help. Lots of threads with people in similar situations main advise that always comes up
1) Contact Mabs
2) Deal in cash only, keep a diary of expenditure
3) Shop in likes of aldi
4) Don't bother saving in the likes of credit union while you have high interest loans clear them off first and save later
 
Might help if you formatted your post to make it easier to read the various incomings/outgoings. It's very difficult to make things out as it stands. Itemising each figure (maybe using bullet points) might help.
 
Tough times, indeed.

1) You should ring either your solicitor or the District Court Family Office and enquire about having your maintenance paid directly into the Courts and then out to you. Non-payment then becomes a breach of a Court Order.
2) Stop getting new cards immediatley. This will worsen things considerably if you keep getting new cards. Slice up what already exists and don't use them. You'll be paying 40 quid duty and interest on each of them.
3) How big is your car? Could you downsize and use any profit to pay off some of the remaining debt - you can pick up a decent car for next to nothing these days. Also, make an appointment with your credit union and see if you can
4)Contact the Money Advice Budgeting Service - its a free, confidential, professeional and confidential service set up by the Dept of Family and Social Welfare and they have loads of branches in Dublin and loads outside of Dublin too. They are excellant. Even if you are a totally busted flush, they will be able to negotiate with the banks and esb etc to reschedule your debts.
5) Cancel further Christmas spending - this time of year you sill be buying rubbish for people who should and no doubt would, if they knew, prefer you to sort out yourself first.
6) Park you self respect and see if your family and even your friends can pitch in at all to help you out.
7) Finally, ask for a pay rise - if you don't ask you don't get!!

Finally, you should recognise that money is a bit of a wild beast and that you need to control every aspect of it in your life - knowing where it is going and what it is doing.
I have seen far worse than your situation. At least you have reconised the dangers now. Take stringent and early action.

If you only do one of the above, ring mabs 1890283438.

I don't work there, by the way!

Chin up!
 
There are some basics that you can do -
Can you bring a luch to work - trust me - it saves a load of cash.
Definatly only work with cash - Mr.Bear and I do this as well esp during the working week.
If you smoke - try cutting down - possibly quitting - I am now down to 2 -3 a day in my effort to quit.
I hope you dont mind suggesting but would you think of selling the car and buying a cheaper one..
Are you paying the correct PAYE - did you know that as a single mum you pay less PAYE and it is back dateable....
 
ClubMan, somehow I dont think bullet points will help me financially but thanks for the formatting advice!

My car has been for sale for 9 months now, slow going as its an 2lr jap import, not exactly a practical family car for a commute! But yes I think I will have to swallow my pride and ring MABS and perhaps as daveyboy says ask for some help. Maintenance should be paid into court, a bench warrant issued recently for non payment and non attendance so who knows what he'll tell the judge but at least its given me confidence that the systems work.

I have to say that controlling Christmas spending has been quite difficult as I really feel the pressure of being Santa this year. Although I have put a limit on it and stuck to it and am desperately trying to convince myself that my son won’t be disappointed on Christmas morning, silly I know. I'm sure parents who are more flush than me are feeling the pressure as well.

Anyway guys, thank you very much for reading my story and giving very practical sound advice
 
S&TT said:
ClubMan, somehow I dont think bullet points will help me financially but thanks for the formatting advice!
Click to expand...

No - but it would help others to more easily get a handle on your summary finacial situation and maybe make some useful comments. If I could see the key figures laid out clearly then I would be interested in commenting. I'm sure there are others who will think the same way when they read your original post. Just trying to be helpful/constructive. Take it or leave it.
 
ST&T, you seem to have the worst of both worlds in that you have a long commute and relatively high rent (for a not great wage).

Is there any possibility of you getting work nearer your house for a similar wage? Alternatively is there somewhere cheaper you can move to that would leave you with a similar commute (though this may cause childcare issues)?

How old is your son? Will you have a €800 a month creche bill for the foreseeable future and, if so, would it be cheaper to use a childminder?
 
You know, you'd be surprised and encouraged sometimes by who can help you and how much people will do for you in a pratical sense when you ask for help. Obviously, i know nothing of your family situation but you might find some help there.
You should also think of getting in touch with other single mothers and talking through your situation with them (there are loads of womens groups and local community centres etc where you can find organisations that can offer advice - practical advice - on how to get by andwork through these difficulties. I know that sounds like a whole bunch of fun, but there are endless numbers of people who've beaten this situation before you and for the sake of getting over 3 or 4 embarrassed minutes where you begin your sceal of woe, you might get some real useful nuggets of golden advice!
 
Also, have you checked that you are receiving all your tax / social welfare entitlements? ie One parent family payment, Family Income Supplement etc - you may not given your salary but it might be worth checking out
 
I work out your repayment outgoings from OP as 2550 per month (not counting clearing O/D or current Credit card payments, and your income at 2660 (not counting irregular maintenance payments, leaving you 110 per MONTH to live on! This can't be right! What am I missing?

Are you getting Rent Supplement? Early Childcare payments? Lone Parent's Allowance?
 
Welfarite said:
I work out your repayment outgoings from OP as 2550 per month (not counting clearing O/D or current Credit card payments, and your income at 2660 (not counting irregular maintenance payments, leaving you 110 per MONTH to live on! This can't be right! What am I missing?
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I allowed for 5% min repayment on AIB cc ie €100 p.m giving op €10 p.m to live on ! I thought the op should have taken on board Clubman's useful comment above and put the numbers in such a way that they were easier to assess - I just lose interest in a thread if there's too much effort involved in crunching the numbers.
 
To try and help the OP slightly (and those of us reading the thread...)


Income
€2,500 per month
€160 child benefit

(~€400 Maintenance)
I receive maintenance sporadically which should be €100 a week however it cant be relied on and is never consistent despite court proceedings.

Savings
I have roughly €800 in the CU in case of emergencies

Outgoings
€950 rent
€800 crèche
€100 insurance
€350 Car loan (€17k left)
€200 Credit Union loan of €2,600
€150 MBA personal loan (6.5K left)
€400 Other - day to day expenses like groceries, petrol (I have a long commute!)etc.

€2500 AIB OD
€2000 AIB CC
 
S&TT said:
ClubMan, somehow I dont think bullet points will help me financially but thanks for the formatting advice!......

.......Anyway guys, thank you very much for reading my story and giving very practical sound advice
Click to expand...

Before we spend more time on this, perhaps the OP could come back to us with clarification of the points raised so far. Last post yesterday would seem to indicate that they have left the building...
 
A few quick points OP:

Rent: As others have pointed out, it seems excessive for somewhere requiring a long commute.
Creche: Again, would you consider using a childminder - would that be cheaper?
Credit Cards: I would change to another card in order to take advantage of the interest holiday - see best buys on another thread on aam. You must be disciplined however and cut up and cancel the other card as soon as the balance is transferred.
Car Loan: I know that having a good car is important to many people, especially when faced with a long commute, but, to my mind perhaps you could sell the car and buy something more appropriate to your needs. It's obviously a matter of personal choice, but, it could make things easier for you, and you should consider it. Is there any public transport alternative? Employers can provide you with tickets and this can result in a tax saving for you.
CU Money: I don't see the point of keeping €800 in the CU, if I were you I'd transfer the bulk of that money into your current account and pay off some of the od or credit card, there's no point in unneccessarily incurring interest imo.
In common with advice from many of the other posters I'd take steps to ensure that you are taking advantage of all available tax credits and benefits. There are extra credits for single parents and rentors etc, make sure you're getting everything.
Maintenance: Presumably this does arrive, even if sporadically, when it does, you should set about paying off the credit card asap, then the overdraft, then start setting it aside in the credit union.
 
Find a community creche. You will be at least halving your childcare costs. There will be a lot of vacancies in the new year as tiered payments come in, and you are eligible for a heavily subsidised place.
 
ClubMan said:
No - but it would help others to more easily get a handle on your summary finacial situation and maybe make some useful comments. If I could see the key figures laid out clearly then I would be interested in commenting. I'm sure there are others who will think the same way when they read your original post. Just trying to be helpful/constructive. Take it or leave it.[/color]
Click to expand...

getting a good plan together will give you optimism that you have solved half the problem.
the rest can be solved by being disciplined and sticking to your plan - it will be tough sometimes.

I myself am crawling out of a financial hole.

Glenbhoy has sound advise - you can always plunder the credit card if a real emergency pops up. for now I would pay off as much as possible, other alternative is to take a loan from the Credit Union - pay the Credit Card and Overdraft

Ditch the car - you will save a fortune on day to day expenses - even if you have extra travelling time because of that. Consider the extra travel as extra work you are being paid for as you are saving the cash you would have spent on a car.

Clubman - any particular font you'd like the message to be in?
 
A very useful way to manage large bills, or bills coming together, is to use the Budget Account facility in your C.U.

You tot your bills for the year and divide by 12, 26 or 52. You then commit to lodge this amount in your account every month, fortnight, or week, whatever suits. You then send all your bills to the CU and they pay them for you.
 
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