# Where to start????



## Frankkk (6 May 2008)

Age 36
Spouse age 37

My income e40,000 
Spouse's income e15,000

Type of employment

Self employed
Part time worker

We definetly spend more than we have

rough value of home is e420,00
outstanding  mortgage e224773
interest rate 4.390%
payments e1225 per month

Other borrowings
Here's where the problems begin!!!

Two Top up Mortgages

Number one for home improvements
borrowed e13,000@ 3.490%
e12,124 remaining
payments e59.32 per month

Number two home for improvements and debt consildation BIG MISTAKE!!
borrowed e45,000@4.790%
e44499 remaining
payments e291.31 per month.

No other loans due to the mistake above

Credit cards

Myself Ulster bank credit card e 4,500 owed
NOT PAYED FOR LAST TWO MONTHS [cant afford it, stupid i know]

Spouse owes e5,000 to MBNA
making the minimum payments.

Overdraft of e2,500
Which we are permanetly in

Small savings in credit union e1300

Pension stopped

No investment property

Chidrens ages 2, 4, & 8
Childcare costs e900 per month

Life insurance apart from on the mortgages, no



MY questions to you all is where do i start to sort all this out??
Our money simply runs out before the end of the month.
Credit card balance run up again after paying it off with debt consildation.
Problems paying my card, payments around e140 per month.[can i come to some agreement with them?]


We have a spread sheet with our incomings and outgoings and there is a surplus but we dont ever see it.

Should i get a loan to clear the overdraft and start a fresh with a tight budget?

Can i switch my credit card now i'm recently self employed??

Anything i could  with our mortgages and the life assurance policies that go with them?

We will have roughly e500 extra in our budget come September due to a child starting to school

We stopped our mortgages for three months to sort this mess out and it has come to a point now where i am worried when they start again that we'll be in real trouble if we dont have a solution by the first of July. 
Its all very stressful for all involved.

Any help will be greatly appreciated.......


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## so-crates (6 May 2008)

First things first, contact MABS, confidential helpline 1890 283438.
Second, although you have a spreadsheet with your incoming and outgoing have you kept a spending diary? You are probably spending money that you aren't realising.


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## pinkyBear (6 May 2008)

Hi there,
With childcare - would you think of getting an aupair - through an agency - My inlaws like you have 3 children a wee bit older than yours, they now use an aupair for €120 pw...


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## Frankkk (7 May 2008)

Thanks for the replies,
MABS contacted and unfortunately our house has no room for an au-pair.
Anybody with anything to add?


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## theoneill (7 May 2008)

Is there any way you can switch your credit cards to avail of 0% interest for a few months?


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## Mpsox (7 May 2008)

Your spouse is earning 15k, yet you are spending €10800k in childcare. Allowing for tax, is it worth her while going out to work for 2-3k a year. If she stopped working, could she transfer her TFA across to yourselves.
Bear in mind as well, if she wasn't working, she wouldn't have the cost of her commute


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## Bronte (7 May 2008)

Would it be possible to extend the term of your mortgage to bring down your monthly repayments.  I advise going to talk to your bank on what to do before the situation gets worse, they can be very helpful.  Talking to someone can help to clear the air and let you see things more clearly. You also need to cut up your credit cards, 3 kids is not easy, when the child starts school will your wife be able to work full time as her low salary versus childcare seems pointless.   As you are self employed are you sure you earn 40K, could you get a higher paying job, your spreadsheet is not working, as previously suggested you need to write down everything you spend on a daily basis, with kids it can add up to quite a lot.


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## infinity (7 May 2008)

You make no mention of cars ? Do you have two cars ? Could you get rid of one or downsize one to free up some money to tackle the Credit Card debt ?
Use the 1300 in the Credit Union to reduce the balance on the Ulster Bank card to 3200 - using the €1575 available each month by pausing your mortgage you will have your credit card bill cleared in 2 months. You can then pay €1575 off the MBNA card to make dent in that too.


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## annR (7 May 2008)

It does seem as though you are spending money that you don't know about.  Would you consider getting rid of the credit cards and going on a regime where you have a certain amount of cash per day that you have to manage on.  
Anything left over put it in a savings jar and leave it there as cash savings to be put towards a specific thing. Larger unavoidable irregular expenses can be budgeted for separately. 

How about direct debits from your account after you get paid so that you know the debts are getting paid off?

It doesn't seem to make sense for your spouse to be working barely covering cost of childcare - maybe it will make more sense when the child starts school in Sep.


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## z105 (7 May 2008)

> 2. Please make the heading of your question relevant    	Don't post a general heading such as "help !" or "Mortgage query". If you post a heading such as "Mortgage for separated couple", it will get a better response and will be much easier to find if you need to go back to look for it.


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## shoppergal (7 May 2008)

Frankkk I'm not sure how useful you'd find it but a website I've seen to be really useful in the past is [broken link removed]. There are various boards, one of them is called debtfreewannabee and they're great on there for helping people figure out where their money is going.

What I would suggest is first take money out of the credit union to pay off the arrears on the ulsterbank card so that you don't rack up any more charges. no point having money sitting in the credit union when you could be reducing the debt you owe. then cancel the credit cards. you're probably thinking oh i can't do that i need them to live but it's a vicious circle and if you don't break it now you never will. 

Do up a budget. You say you should have a surplus according to the figures. are you including absolutely everything. Look through your bank statements for the last few months and see where it's been going. don't forget to include one off expenses in your budget like car tax, insurance, christmas, birthdays etc.

best budgeting tip i ever got was to keep a spending diary. you can do it online at www.spendingdiary.com. it really helps to see where each penny is going. spend only what you absolutely have to spend and throw everything else at your credit cards

with the 500 extra you have in september start throwing it at your highest interest debts first. Once your cards and overdraft are clear you'll probably feel a lot more in control. 

You need to look at what you're spending all the money on as well though. it would seem like the second top  up was quite recent yet you have more than 10 grand of credit card debt still. is there anything you could sell?

best of luck with it. i'm sure you can do it.


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## sam h (7 May 2008)

> Your spouse is earning 15k, yet you are spending €10800k in childcare. Allowing for tax, is it worth her while going out to work for 2-3k a year. If she stopped working, could she transfer her TFA across to yourselves.
> Bear in mind as well, if she wasn't working, she wouldn't have the cost of her commute



I'd agree with this....is it worth her while working?   If she stayed at home, she could mind kids to up the income.  
Or could she go full-time as it seems as if she is paying for full-time childcare?


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## Mumha (8 May 2008)

sam h said:


> If she stayed at home, she could mind kids to up the income.


 
That is actually an excellent idea. Friends of mine are in financial difficulties as well and currently looking into doing just that. Even to do it for 2-3 years, until things pick up. I know that it can be a bit restricting but needs must.


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## Diziet (15 May 2008)

Frankkk said:


> We have a spread sheet with our incomings and outgoings and there is a surplus but we dont ever see it.
> 
> .....



If you don't see the surplus, then you don't have a budget, you have wishful thinking 

Keep a spending diary for at least a month. Write down absolutely everything, down to the last newspaper of cup of coffee. Then compare with your budget. Is your budget realistic? How do you budget for annual bills, clothes, birthdays, haircuts, holidays? Find out exactly where your money is going and you will be able to address the problem from a position of strength.

Whatever you do do not take on more debt.


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