Short Term debt - finding it difficult to manage

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Dublingirl

Guest
Age: 28
Spouse’s/Partner's age: N/a

Annual gross income from employment or profession: 58,000
Annual gross income of spouse: N/a

Type of employment: Private Sector

Spending more than I earn

Rough estimate of value of home:€220,000
Amount outstanding on your mortgage: €210,000
What interest rate are you paying? Standard Variable 3.8% EBS

Other borrowings

Above Mortgage over 35 years - Repayments of €800 per month (After TRS)

Credit Union Loan Borrowed 30k - Balance 23k, repayments 500pm. 5 Years left on loan.

MBNA Loan - Borrowed 18k -Balance 11k Repayments 345pm. 3 Years left on loan

BOI Loan - Borrowed 32K - Balance 25K - Repayments 665.00pm - 4 Years left on Loan

Do you pay off your full credit card balance each month? No
If not, what is the balance on your credit card?

Halifax 6K - Pay 198.00 per month
MBNA 6k - Pay minimum payment per month circa 80 euro


Savings and investments: None

Do you have a pension scheme? No

Do you own any investment or other property? No

Ages of children: None

Life insurance: None

Other bills

Car ( Worth 1k) - Insurance 35 per month, Tax 30 per month, petrol 20 per month

Phone - Ready to go €20 per month
VHI: €85 per month
TV NTL: €35 per month
TV Licence 13.33 per month
Grocery Shopping : 200 per month
Bus Travel: €90 per month ( 4 miles to work)
Apartment Management fees - 75 per month ( 900.00 annually)
ESB : 50.00 per month
GAS: Don't use in summer but usually 40.00 per month in winter.


What specific question do you have or what issues are of concern to you?

I am currenly paying all the above and am not in arrears, however I am finding it difficult to make ends meet. I do not smoke and have not been spending any money on nights out/takeaways/holidays, as you can see from my debt I did too much of this in the past and now want to try to get myself debt free. I understand I put myself in this position and blame nobody else. Just hoping for some suggestions and advice. All welcome and thank you in advance.
 
Hi dublingirl, firstly fair play to you for managing to keep up all those payments and keeping out of arrears, that is the most important thing. The two credit cards are where you need to put your attention first, as everything you pay to them at the moment is just getting swallowed up in interest and you're not making any ground with the balance itself. I would try therefore (this may sound crazy but I believe in giving things a go) approach MBNA and BOI to see if you can top up your loans to clear the cc's, say to them, look, I have been paying all of these, haven't missed a payment, you've nothing to lose by trying them. If you can even get 1 k together also to show them you've that to put towards it, that might help. I got a loan last year for simar purpose, I just worked hard on getting some money together for a few months so I could say, well I have this much and I need yo borrow this much, and I got it, so it's always worth trying. Other than that, I'm afraid there's no quick fix, just keep making the payments and you will get there. Best of luck,
 
Monthly figures:
Income = €3,332.34
Expenditure= €3,281.33
Approx. €50 left over, keep it for your socialising kitty, you will need it at times.

Cut the following:
You are in difficulty for a 4-5 year period only, so cut the following for that period only:
1. Cut VHI
2. Sell your telivision & loose your TV licience, loose your NTL, use it as an excuse to call around to your friends to watch their telly.
3. Buy a bicycle & cycle the 4 miles, no more monthly travel
4. Cut you shopping bill from €200 to €150/month (I have done this, see below)

YOU FREE UP AN EXTRA €273.33/month, pay off your credit card with this

Shopping bill:
Heres an easy way to remember to keep your shopping to a limit of approx. €150/month, it works for me anyway:
Firstly break down what you eat into the following (my examples are in italics, but use whatever you normally eat):

1. Breakfast - cereal & milk
2. Fruit - apples, oranges, bananas
3. Veg - carrots, celary, broculli
4. Lunch - Slice pan, sliced ham/turkey, Block of cheese
5. Dinner - meat & fish products
6. Dinner - Rice, pasta, spagetti, pepper/salt, flavourings etc
7. Snacks - Cream crackers, biscuits, yoghurts etc

If you remember each of the categories above, now also remember you have a maximum spend of €5/week on each category, equating to €35/week shopping spend, €157/month spend. You will save the other €7 on categories 6 & 7, bringing it back down to the €150/month.

When you think of Category 1 - Breakfast, the next time you go to the shop, you know your limit is €5/category, you see a LIDL museli for €2.50 & 2L of milk for €1.65, its €4.15, its less than my €5 spend a week.

The major problem is everyone goes into a foodstore, not knowing what they want, & not knowing what THE TOTAL COST before the cashier tells you, 'well that will be 201 euro & 35 cents please!!!

Open to criticism or any other thoughts, my few tips & suggestions
 
Agree with above posters, mind you not sure about losing the TV as if you have cut entertainment you need something. Try looking around for different package though. I am on sky basic at 22 a month.
ESB is a bit much at 50 per month, switch to one of the other providers, airtricity or bord gais. Mind is less than 80 small saving but one none the less.
Can you rent a room in the apartment even short term just to get the CC clear for a start.
Have you tried switching to 0% balance transfer cc. How about asking the CC companies to freeze cards as it and cut them up.
Any chance of a family loan to clear the CC.
Best of luck.
 
Well done Dublingirl on keeping those repayments met and making sacrifices to do so. I don't know if you would find it possible to get another 0% card or a bank loan to clear the credit cards so to be honest I think you should focus on getting them cleared.
If you can keep up the sacrifices then you would be repaid all loans in 5 years and still young and a home owner so keep positive about it.
I think if at all possible then rent out a room, not everyone wants to live with someone else but you could tell yourself it's just for a year or two so you clear the credit cards.
I think keep the tv but switch from NTL to rabbit ears (free!) or basic sky package. For one person €200 is a lot on groceries, you could get this down a lot in Aldi shopping.
The ESB seems quite high, check the bill to see if it is an estimate. Take a meter reading and give them that. I just got a €80 credit from them as their estimated bills are usually higher than usage.
Your bus travel is essential I think, not everyone wants to cycle to an office, and the weather makes it hard anyway.
Your VHI is not essential so consider getting rid of it for a while - €85 a mth extra off the credit card.
Since you have no budget to go out anyway then have you considered trying to get take away delivery / babysitting work. This could bring in a bit of extra funds to put off the credit card.
Most importantly keep up your good work making repayments. You're doing a good job and stay positive.
 
If I have done my maths correctly, you have borrowed €92k. Question is, for what and do you have any assets that you can sell to help reduce the debt?

Secondly do a full review of you tax situation and ensure that you are claiming for everything you are entitled to, bin charges, medical expenses etc etc. See if you can claim anything for other years as well

Thirdly, and this may sound bizarre in your circumstances, open a savings account. Even if you are only loding your spare change at the end of the month, one of the key areas in debt management is the psychology of it all. It can often be good to realise at the end of every month, not only do you owe a little less but that you are beginning to build some savings as well. Also it will be a good ongoing habit

Unless you have specific medical reasons for VHI, I would seriously consider scrapping it
 
Thanks for all the suggestions.

Went to Aldi on Sat and spend €30, got all my shopping for the week - so thanks popejohnpaul!

Going to keep my VHI as it covers me if I go to the doc - I get €25 back and I have dental also, and I have had two fillings this year and a check up and was able to claim 80% of this back! So, so far this year I have claimed about €350 back from VHI.

Would defo take on an extra job, have looked on nixers.ie and checked with local takeaway. No joy - Any other websites/areas I could look into?
 
Are you in Dublin? Does your employer not do the taxsaver scheme? Details are here www.taxsaver.ie basically you pay for your bus ticket out of your gross wages so your employer saves on PRSI and you save on Tax, given your wages you'd be reducing your bus fares by half.
 
Hi there, I would be with DUblinGirll on VHI, its not just the short term cover. There is long term to concider too. If DG gave up her VHI and became ill, while she can go back on VHI she would not be covered for the illness she got while without VHI...
 
Thanks Pinky Bear. Yeah the VHI is the only thing I am not willing to give up on. Happy enough with cutting back on everything else!
Derek - will definately look into the tax saver travel

Thanks for all the suggestions so far! Any other hints or suggestions?

Also I have checked my last few ESB bills and they work out on average about €75 per two months.

One other thing I did not put down in costs was my monthly prescription of about €25 per month.
 
Hi Dublingirl.

I think as Fizzelina said it will be tough for 5 years or so and then you should be ok. You are young and earning a good salary, so there is plenty to be thankful for.

To echo Mpsox are you claiming all your tax reliefs;

Travel pass as mentioned

Medical Relief for amounts not reimbursed by the VHI (this may include your prescription) See form Med1 on the revenue.ie site for this.

Relief on the portion of your apartment service charges related to bins.

Were any of the loans taken out related to completing further education ? Check revenue.ie for a list of courses qualifying for relief on tuition fees.

Relief for subsciptions to a trade union.

I would also say that VHI should be only cut as a last resort.

Good luck
 
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