# Trying to rectify historic mismanagement



## BazFitz (30 Sep 2010)

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## micro (1 Oct 2010)

I've taken a large paycut myself (as have many others!) so I sympathise with your situation.
You say you are not considering selling your 2nd property so it seems that you should be working on getting the monthly bills down. 
From my calculations you should be getting in 4900+550 (rental income) - 4301 total monthly outgoings.

For starters:
ESB- outlandish! Is this monthly? ESB have an online calculator where you can input your usual consumption and it returns an estimated bill. Maybe check this out and see where you could make cutbacks. If you are living in a 3 bed semi without storage heating then maybe one of your appliances needs a service (the fridge in our last rental was on it's deathbed and contributing towards bi-monthly ESB bills of 200-300E).

Change your NTL package- we currently have the digimax (? not sure if that is the name but 150 channels, no SKY movies/sports), 15mb broadband for c. 60E/month and will be adding home phone for an 6E shortly (free calls). 

O2- 115E?? Can you go PAYG or change provider? This seems extortionate. 

Savings- do you have enough savings to reduce your overdraft so that at least your salaries are clearing it once a month? 

Any chance you can consolidate your CCs and overdraft? having done this recently myself, I can say that although I still have the same debt, it's more manageable and seeing my current account in credit for at least a week a month (! ) is good for the mindset!

Another note on savings- I see from several posts in this forum that posters argue the sense of having savings when the interest earned on them is negated by the interest on debt and why have a pile of savings with a big pile of debt? I, on the other hand, like to know there is a small rainy day fund.

On the upside, you are managing and you do seem (I could be wrong!) to have about 600E left at the end of the bills. Could you suffer some short term pain and throw this off a credit card? Or can you move the balances to a 0% card? 

Best of luck with it all. I'm sure there is way better and more financially sound advice just around the corner!


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## dereko1969 (1 Oct 2010)

I'm presuming given the amount you're spending on fuel/insurance/tolls etc that you have 2 cars? Do you really need both? If so, could you sell one and buy a cheaper one and use the proceeds to pay off one of your credit cards?

Dump the health insurance.

Your spend on Eircom and Mobiles is huge, dump the home line and start examining better options for your mobiles. Also with your NTL, there's much better packages out there, get NTL phone and you should be able to get a package for less than what you're currently paying out for both Eircom and Ntl.

Phonewatch? Is this really necessary?

Stop saving, start paying off your debts.

You need to keep a spending diary on absolutely everything. It seems to me that something got out of hand given the scale of your debts and you need to start really seeing what you're spending your money on.

Start selling "things" that you own - you must have something to show for the debt you've accumulated.

Start living within your means.


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## BazFitz (2 Oct 2010)

Thanks for the input folks...all reasonable points. We're stuck with NTL unfortunately and we do need two cars but we're actively trying to get things back on track. Everything's electric in our place so the ESB is quite high (but then we've no gas or coal etc). I genuinely wouldn't ditch Sky Sports because I find that I end up spending more money in the pub because I have to go out to watch stuff! We're gonna ditch the landline and cut back on the mobiles too. Unfortunately consolidation or 0% rates just aren't available if you're in trouble. 

We acknowledge that there are people out there with far more "real" problems and that we've been stupid in the past. Being brutally honest, we just weren't bothered with keeping an eye on what we spent when there was plenty coming in.

This recession has been a serious learning curve for me. I've joined a Credit Union, and I aim to be debt free (excluding mortgages) within 5 years and to have 3 months net salary saved for a rainy day. At that point we'll have one credit card account with two cards and a small limit which we'll clear every month. I swear to God that this will never happen again.


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## Complainer (2 Oct 2010)

BazFitz said:


> .  We're stuch with NTL unfortunately ....I genuinely wouldn't ditch Sky Sports because I find that I end up spending more money in the pub because I have to go out to watch stuff!


Congrats on setting out clear goals for your future.

However, I fear that you won't achieve these goals with the kind of approach highlighted above. 

Something has to give. If you're going to save money, you have to be prepared to cut back.


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## BazFitz (2 Oct 2010)

Complainer said:


> Congrats on setting out clear goals for your future.
> 
> However, I fear that you won't achieve these goals with the kind of approach highlighted above.
> 
> Something has to give. If you're going to save money, you have to be prepared to cut back.


 
Thanks for you input.  I see your point but one has to live too.


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## dubrov (2 Oct 2010)

It looks like you are earning enough to support your lifestyle. The problem you seem to have is paying your debt off.

As already suggested, switch ESB to either Aitricity or Bord Gais (I think BG are a bit cheaper at the moment). €120 a month seems a lot for 2 people.

UPC do a numer of deals including phone broadband and tv so look at them. Some of their best packages are only available to new customers so you may need to cancel in your name and reregister the account in your girlfriend''s. 

Consider looking for a new job that either a) pays more or b) removes the need for a car. You'd be suprised how much a car costs (maintenance, insurance, road tax, petrol etc.).

Work out where you mobile call spend is going. Most networks have packages offering free/reduced calls to phones on the same network so it might be worth switching. If it is going on landline calls then the upc package should sort you out.

Cancel phonewatch. I believe the gardai don't call out to your home anyway if there is a problem

Your rental income on the overseas property looks very low. €550 pm => €6600 per year. If the property is worth €250,000 as you suggest then that is a 2.64% return which is really poor. Maybe those local issues are already priced in. 

Sounds like your credit rating is already a bit damaged so repackaging the loans is probably not an option. Just try to work down the credit card debts first.

You'd be suprised how much the little things add up


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## BazFitz (3 Oct 2010)

Thanks Dubrov...valid and sensible points.


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## niceoneted (3 Oct 2010)

You have to change your mindset if you are to clear all the debts you have. 
You incomings minus outgoings leave a balance of 1171. What is being done with this money. 
You will have to get rid of phonewatch, reduce spending on mobile and go to basic NTL package. As a sports lover myself who is listening to live ryder cup at the  moment - I will watch the highlights later on. You can survive with highlights and what sport is on the tv. you can get the channels back when the debt is gone - perhaps an incentive to clear it sooner. also if you have so much time to watch sport perhaps you might get some extra work to bring in extra cash. 

Eircom is high too. There are cheaper packages out there for phone and broadband. 
Start a spending diary. write everything down. 
250 every two months for the ESB is high even if it includes your heating. I pay less for ESB, Gas and coal (fire stuff) combined. Switch to bord Gais or airtricity to avail of their discounts. 

The reality is that you have two combined mortgages of 459K with estimated equity of 41k
Unsecured loans including OD of 90,500. Until you understand how you accumulated this debt you will not come out of it. 
It might be best for you to use the snowball method of clearing debt. Work on the BOI CC of 4500 then halifax of 8000 etc. 
How secure are your jobs?
Best of luck.


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