Living pay cheque to pay cheque any advice?

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lucy09

Registered User
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27
Age: 28
Spouse’s/Partner's age: 36

Annual gross income from employment or profession: Net 2,480.02 per month
Annual gross income of spouse: Unemployed €196.00 per week

Type of employment: teacher.
In general are you:

(a) spending more than you earn, or
(b) saving?

Spending everything we earn. Living on a very small amount per week.

Rough estimate of value of home :220,000
Amount outstanding on your mortgage: 181,000
What interest rate are you paying? Tracker €686.62 per month (after TRS)

Other borrowings – car loans/personal loans etc
1: Boi Personal loan -owe €8,763.81 2 yrs 9 months left (€308.03 per month)
2: Cr Union – owe €16,195.58 3 yrs left ( €502.06 per month)
Overdraft – 1,600

Do you pay off your full credit card balance each month? NO
Other loan Payments
Cr Card 1 – MBNA 2,000 paying €150.00 per month ( Card is cut up)
Cr Card 2 –Tesco 3,000 paying €100 per month
Cr Card 3 – BOI 5,700 paying €150 per month but interest is €104 so getting no where (card also cut up)

Savings and investments:
€4,063 Credit Union ( tied into loan) Also saving €40 per month

Do you have a pension scheme?
Yes. Taken out of my wages before I get them

Do you own any investment or other property?
No

Ages of children:
None

Life insurance:
€47.65 per month

My husband is unemployed for nearly two years. We also got married two years ago and the loans were taken out to pay for wedding. The credit card debt is a result of living beyond our means when my husband lost his job and using the cards to keep us going from pay cheque to pay cheque.
We both acknowledge this and have cut up two of our three credit cards.
All our loans and credit cards and mortgage repayments are up to date.
Per month:
Approx expenses each month


Home Insurance: €32.82 p/m
Car Insurance: Spouse €33.00 p/m
Food: 200 p/m
Petrol: 120 p/m/
ESB: 60 p/m/
Broadband: 20p/m
Phone 20 p/m
Health Insurance: 64.61 per month
Cigs: 20 per day = 230 per month(This annoys me but husband won't budge)

Yearly Expenses :
My car Insurance – 300 per year
2 car tax - approx 300 each per year
Bins €240
Turf €250.00
Oil: €600
T.V. Licence €160.00

What I want to know is -

Any ideas? We are constantly living pay cheque to pay cheque. When we took out the loans my husband was working but now he is unemployed and I have taken a major cut in my wages. We have cut everything that we can already. I know my VHI seems expensive but I need it and hope to start a family soon so don’t want to change it. We shop in Aldi. My husband smokes which really bugs me but can’t get him to give them up.

I feel like it’s the little things that make it impossible for us e.g. birthdays, weddings , xmas as we never seem to be able to get ahead.

Was thinking of approaching BOI to see would they top up our existing loan to clear our credit card? But not sure if they would take this on seeing as we have so much debt.
We are constantly worried about money and we were both talking last night and we said all we want is to be able to pay all our bills and to buy groceries and not be trying to add up what we are putting into the trolley incase we can't pay for them.
We would love to start a family soon but really can't afford it. Any advice welcome?
Thanks in advance
 
are you claiming your husbands tax credits?
are you claiming other tax credits like refuse, trade union etc
can you rent out a room in house?

You seem to be living very modestly besides. Definitely consolidating the loans would be a good thing...you need to clear credit cards and overdraft asap as these are the ones with the highest interest

Apart from that i wouldn't be too downbeat...you have just over 30K of debt which at your age isn't the end of the world...and you are not in negative equity.

Can your husband get a partime job?
 
Hi Lucy09,

Firstly, don't panic. You are keeping the boat afloat but just barely. Is your job secure?

Firstly, well done on tightening the belt thus far. I am about to lay a lot on you but I need to commend you first on cutting up the 2 cards and staying up to date on all loans / debt.

Right! Your partner has a car, yes? He must, as you pay tax, insurance, etc. for him and pay more for yourself. Why does he have a car when he is not currently working? You need to get harsh and sell the car to clear some debt immediately. Even if his car could get you 2k, thats one CC card cleared and an extra 150 euros per month. It also free's up the cost of tax and insurance - get on to your own insurance company and add him as a named driver - it will be far cheaper and he still has access to a car when you return from work.

In relation to the credit cards, specifically the 3rd card with the most debt. Throwing just over the minimum payment at it will not get you anywhere. Speak with ALL 3 CARD PROVIDERS and ask them to freeze the interest for a few months. This will give you some breathing space to clear the cards as they are. Worst case scenario they say no but theres no harm in asking. If they all agree to this, I would then focus as much as you can on the largest as it will cripple you.

Credit Union loan - have you asked them to lengthen out the term of the loan? It will again free up some money to throw at the CC debt. Please also ask BOI to do the same with the personal loan. If neither will extend the term for you, ask them for a period of interest only. You might also ask the Credit Union to take some of the savings you have against the loan to decrease repayments but it will only lower it a very small amount as the loan is quite large.

Life Insurance - get rid of it for now. Even 6 months without it will help you out. Eventually you will be able to cover yourselves but right now you cannot afford it.

I understand you want to start a family soon and that is the reason you want to keep the health cover. Be honest with yourself - the situation you are both in now is in no way fit for a child. You are struggling right now but hopefully in a year things will have improved. Cancel the health insurance, for 6 months at least.

Also enquire if you can opt out of your Pension Scheme at work - even for 1 year it will help. Has your Husband transferred all his tax credits to you? Check to ensure this is done as it can increase your take-home pay.

Do what you can to lower your ESB costs. Everytime you leave a room, turn all lights / electrical products off. If you have plug sockets with switches - switch them off! Be meticulous about it. I've found this really works for us. Try not to use electricity as much as you can. Pull up the blinds first thing in the morning for some light, etc.

Can you do without the broadband? Is it a necessity? If not, cancel it. Again, for a few months!!!


Now...the hard part - the smoking. I understand your partner has an addiction and is adamant he will not quit. He doesn't have to quit, but he does need to cut down. He should limit the amount of cigarettes he has for the week. What I mean is, Monday morning purchase 3 x 20 packs of cigs - this is what he has until the following Monday and he is to make them last. Thats cutting him down to about 8 cigs a day. This is totally do-able and saves ye the most money now. If he is smoking 20 cigs a day, he is actually spending 250 euros a month which is more than you have estimated below. With this new system (which he will hopefully realize is necessary) you are saving 140 euros a month right there. If he wants another packet a week, thats fine - its still saving you 100 euros.

There is also the obvious reasons to cut back on the smokes - health, fitness, you (his wife) despise it, and the big elephant in the room - YOU BOTH WANT TO START A FAMILY. His smoking is effecting his fertility badly and will continue to do so. On top of that bringing a newborn baby home to a smoky environment is not healthy and he should be aiming to quit before you start trying.

Come back to me on your views and progress of the above and we'll see what else I can help you with.

Finally, don't be downbeat about adding up the shopping as it goes in the trolley - Lots of us do that, debt or not ;)
 
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How is your spouse getting full rate dole after two years?Are you sure this figure is correct?And what happens to the balance of the dole after the tenner a day is spent on fags?Is this used for living expenses
 
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Thank you so much for taking the time to reply. I have been looking at this website for so long but was afraid to input my information because I know we have so much debt but feel like a weight has been lifted off me for even typing it!!

Firstly I am claiming my husbands tax credits and all bin, trade union etc. I don't think renting out a room would work as we live in the country. We have an old house that we bought and are renovating bit by bit so its not feasible.

With regard to my husband , he has worked for maybe 2/3 months at a time during the last two years. He is getting paid from his stamps but when this runs out, he will get nothing because of my wages. He is hoping that a job is coming up soon.

As I teach I am thinking of trying to get part-time work for the evenings but I'm just after having a major operation so I'm still recovering from that. But in a few weeks will def look into it.

Sorry I should have typed life Assurance of 47.65. This is tied into our mortgage so cannot be cancelled.

Yes will def cancel the broadband.
Will get onto BOI to see would they put the credit card onto our personal loan. I know this sounds stupid but the thoughts of going into the bank for a meeting and having to declare all his debt makes me cringe!!

As for my husbands car, it is probably worth 2k, it currently needs oil and a battery and is sitting in the yard for the last month. He has not paid tax on it in about 6 months. But if we sell it and then he gets a job we wont have 2k to buy another car and most of the construction work that will be coming up in the next few months is about 35 miles away from our home.

ESB: We definitely can cut this down, we are brutal for leaving the laptop running or falling asleep with the T.V. on.
Don't think I can opt out of my pension as it comes out of my wages before I get them.

The cigs: I just called out the replies to my husband and he has admitted that he needs to cut down so he is going to try your suggestion. I have never smoked and can't understand this addiction so it drives me mad. But I know that the more worried he is about getting a job or the debt we have the more he needs a cigarette.
I can't jusify spening €250 a month on cigs when that would be our min repayment on two of our credit cards.

Yes after he buy cigs he hands over all his dole money and this is used to pay bills etc..

As for VHI I know it seems alot but i'm just after having an operation that I could not have paid for if I did not have VHI and I know that they have restrictions on when you can claim if you cancel your ploicy and start up again.

As for extending the terms of the loans. I know this might seem stupid but in my head I keep thinking if we can just clear the credit cards and throw all the extra money at the loans we could be debt free in 3 years.

Also our plan is that if my husband got this job that he is hoping for, we could just throw money at the credit cards and at least get 2 of the 3 cleared ASAP.

Also we have started a spending diary as we know we spend money on takeaways, that needs to stop.

Thanks again
 
Hi Lucy,

Cigarettes are very addictive (I know), your husband has to make up his own mind about giving them up. I would suggest he try some of the nicotine products on the market, the losanges eventually worked for me, they will helped with the worst of the withdrawal syndromes. There was a long thread on here last year on the pros and cons of e-cigarettes if you do a search you will find it.

It is very obvious you are determined to get your debt reduced, would it be possible to get an interest free credit card and transfer all the balances to the new one? I dont know if they still do this.

Good Luck and fingers crossed your husband will get work soon.
 
I think all your bills are low enough and justified apart form the ESB which could be reduced.

Cigs have to go. I am off them 6 years. I wanted to give them up and read the Alan Carr book. I didn't even get to finish it I gave them up half way through. Even to cut down to 10 a day for a start.

Try to switch the credit cards to ones with interest free periods. If you could get the BOI one onto it or the two small ones.

I would look to stretch out the personal loan with BOI and CU to 5 yrs. You still could pay them off in 3 but it will free up some money to pay off the CC's, once they are paid off and hopefully your OH will have some work you can look to clear the loans.

Your OH needs to look at work outside construction. Retraining or up skilling to improve his chances of work.

Not sure if you are primary or secondary teacher if secondary what about giving grinds to bring in extra money.

Best of luck with it all.
 
"Cigs: 20 per day = 230 per month(This annoys me but husband won't budge)"


€2,760 per year for your husband alone. That is crazy, addiction or not.
 
Billo said:
"Cigs: 20 per day = 230 per month(This annoys me but husband won't budge)"


€2,760 per year for your husband alone. That is crazy, addiction or not.
Click to expand...


Plenty of people spend €100 a week on booze and they dont see nothing crazy about it. Sometimes people need cigarettes especially during periods of high stress. Unemployment severely undermines a man's confidence and self esteem.

I am not condoning it but as a past smoker I understand the addiction.
 
Your husband can continue smoking if he wants, but you should force him to make up the €230 by giving up something else, e.g. €230 less food per month.

It'll help him give up. :)
 
Thanks for all the replies. He is cutting down on the cigs and I am conscious of him feeling down and his self-esteem.

Do you think I should try BOI to get them to top up our personal loan and clear the BOI credit card now or should we wait until we have the MBNA €2,000 cleared first as this might help our case.

Don't know if we would qualify for another credit card to try to do a 0% balance transfer.
I'm a primary teacher so not really a market for grinds.But could mind kids in their own home after school so am looking out for jobs like this.
Will cancel broadband this week and start turning off lights when not needed. Any more advice greatly appreciated.
 
How about providing an after school service in your area? You could bring 3 or 4 children home to your house, supervise their homework and provide their dinner. There are a few people doing this where I live. The going rate seems to be €20 per day for 1 child or €30 for 2 siblings. You should check this out with your car insurance provider and be sure to have the appropriate booster seats in your car.

We recently got a CC with a 10mth interest free period from MBNA. The CC we already had with them was in my name so we just applied for another in my husband's name and transferred the money over.
 
Meant to add - the childcare could provide an extra €300+ income per week, would go a long way towards wiping your debts.
 
Hi lucy09,

Firstly congratulations, you are doing an amazing job right now in managing your finances. If together you are managing to cover all your outgoings on your household income without adding more debt then you have made an outstanding effort.

What you want, as a minimum, is to save this months income to spend next month and for example ditch the stress of payment due dates and not buying groceries until after Credit Card X has taken its minimum payment?

OK, I am ignorant of credit unions, will they really not let you access that €4000? Because that amount solves your most immediate worry.

Savings of €40 a month, also to the credit union? Is that accessible?
As mentioned, talk to all your lenders, look for payment holidays on the personal loans, rate reductions on the credit cards. Payment holiday on the mortgage, anything to give you that breathing space to save.

Out of the numbers you provided, there is a shortfall of over €400 a month. Likely you've underestimated some of your expenses. If it's being squandered, then some of that €400 is really your lifeline. Not even to use it all to paydown the debt but just for ye to feel back in control, to save a bit for that wedding, or small holiday, or do a little bit with the house without resorting to the credit cards.
So you both should have a spending diary. I use a pocket sized notebook myself. Be detailed and accurate. I wouldn't split out the groceries bill into smaller categories unless perhaps 'luxury' items like alcohol or treats are a regular purchase.

You don't need a budget but it will help to define and prioritise where your money flows.
After one months recording expenses in the spending diary you'll have a surprising idea of where your money goes, after two months you'll have a certain idea of what you'd consider waste and what is necessity. Budget yourselves a little pocket money, it's not all gloom!

28 and female I'm guessing you Facebook :) Keep the broadband, it'll keep ye sane come the winter.


I found good debt management and budgeting information on the internet, mostly American but I found their enthusiasm and spirit of benefit.

Not seen it get much coverage here but the debt snowball method of paying down debt is something I really just 'got'.
It's one of the 7 Baby Steps a program devised by a Dave Ramsey.

Personal Finance blogs:
the simple dollar, a blog, personal story of getting out of debt, with a focus on frugal living.
getrichslowly also a blog, where the new definition of rich is 'being debt free'

Both led me to:
YNAB - budgeting software that just works simply. Expensive though. Good forums on the website.
and
The 'zen' budget.

Good Luck,

FG
 
It's all very well and good saying just give up the smokes like that, but it ain't that easy. I've had the addicition, I'm in the process of beating it, but I tell you one thing, unless you want to give them up, then it's highly unlikely you will. I spent years convincing myself that I wanted to give them up, but it only lately really that it actually became what I wanted.

Re the VHI, I wouldn't give that up if I were you. I did and I regret it. If you had a relapse of whatever condition required operating on, you're goosed. Even if you gave it up and went back on it after six months, it's a pre-existing condition and so you have to wait 5 years before you can have any treatment on it under insurance.
 
Only a few Suggestions to start

1) go and talk to Bank of Ireland, ask them to consolidate the Overdraft, term loan and Credit Card (BOI debt only), They will look at that favourably and hopefully give you 7 years at a much lower repayment. Typically they will cancel the O/d facility and the Credit Card but you will still be better off.

2) stop placing €40 per month in CU shares, go in and talk to them, they will allow you to extend the period (reduce the payment) as long as you are upfront with them.

3) can you trade down on your car, would it release any worthwhile funds?
 
niceoneted said:
Cigs have to go. I am off them 6 years. I wanted to give them up and read the Alan Carr book. I didn't even get to finish it I gave them up half way through. Even to cut down to 10 a day for a start.
Click to expand...

+ 1 on the Alan Carr book, I used to smoke 20 a day and quit after reading this book 9 years ago. So it is possible.

spending 250 a month on cigs is just not justifiable in your situation.

good luck
 
J.Ryan said:
1) go and talk to Bank of Ireland, ask them to consolidate the Overdraft, term loan and Credit Card (BOI debt only), They will look at that favourably and hopefully give you 7 years at a much lower repayment. Typically they will cancel the O/d facility and the Credit Card but you will still be better off.
Click to expand...
The above could be a good option. If they weren't too keen I'd say that without restructuring I wouldn't be able to keep up my mortgage payments (assuming it a BOI mortgage) and that might sway things.

That said, I'd be very tempted to sell the house, clear all debts, and have options . . such as rent somewhere nice, start a family and live comfortably, and debt free, on one wage . . or emigrate in search of work and a better life . . etc.
 
When your husband loses his dole in the next few months then you can control his spending. One way of giving up.
 
When your husband loses his dole in the next few months then you can control his spending. One way of giving up.


I would sell your house and use any remaining money to pay off your Debra. Your income is plenty for two people to live on.
 
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