# OK income too many debts. What to do?



## eireann (29 Dec 2009)

*Age:*
*31*
*Spouse’s/Partner's age:*
29
*Annual gross income from employment or profession:*
£29000 sterling
*Annual gross income spouse:*
E33,000

*Type of employment:*
Public Servant in Northern Ireland (cross border worker)
Spouse private sector
*Expenditure pattern:*
Most money goes on repayment of debt. Never seem to have any money left over at end of month.

Other monthly expenditure

Diesel €250
Food €250
Bins €12
Sky €67 NEVER go out
Life insurance €30
House Insurance €40
Car Insurance €35
Van Insurance €35
Phone €40
Mobiles €40
Car Tax €35
ESB €150
Childminder was €512 but due to double with second child 

*Rough estimate of value of home*
E400,000
*Mortgage on home*
E180,000 - 21 years left
*Mortgage provider:*
Ulser Bank
*Type of mortgage: Tracker, interest only, fixed rate*
Tracker
*Interest rate*
Tracker of ECB+0.85%
*Other borrowings – car loans/personal loans etc*
Persoanl loan €20000 reamining First active 7.1% 21 months remaining €990p/m
Car loan about €8000 remaining with 7.3% BOI 3 years remaining €305 p/m
Credit card €2300 remaining at 0% with Halifax
Spouse has an overdraft of €2-3000 p/m
*Do you pay off your full credit card balance each month?*
No. Keep moving providers to avail of 0% balance trasfer rate.

*Savings and investments:*
None
*Do you have a pension scheme?*
Yes, I have a public service pension from the UK
Spouses company pay into a company scheme

*Do you own any investment or other property?*
No.

*Ages of children:*
2+1
*Life insurance:*
Yes.

*What specific question do you have or what issues are of concern to you?*
Basically our personal loan of €990 p/m is killing us. We applied for a top up to our mortgage to consolidate it and were approved but through slackness on our and the banks part the offer went out of date. Is it the best thing to do to try to solve our money problems or should we continue paying it off as there are less than 2 years remaining. Or are there any other ways around this. We take in good enough money including child benefit but just cannot seem to get our heads above water.I have a permenant job and my spouse should be ok for the next ear but nothing is guaranteed.

I am also currently on maternity leave but am considering going back to work part-time. With tax credits in the north, working less than half the hours would reduce my pay by approximately €400p/m which would make sense as we would not have to pay a childminder as much.

Any advice greatly received
Thanks!


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## circle (30 Dec 2009)

You have a great mortgage rate - remortgaging would probably involve losing this and going onto a variable rate that could cost a lot more when interest rates go up.

You spend a lot on diesel - could it be possible to find a job closer to home and cut this expense? Possibly even getting rid of the second car?

Your ESB bill also seems very high for a month - if you switch to Airtricity or Bord Gas you'll knock a chunk off this.

Would it be possible to shop around for a good childminding rate for your two children?

You could consider dropping the home phone if you both have mobiles.

It'd help if you added in the detail of your monthly net income, including child benefit and your monthly mortgage payment.


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## chlipps (30 Dec 2009)

I agree with circle.. some of your costs seem very high and should be challenged

Also. get rid of sky and go for the free to air channels. We seldom go out but there are many FTA channels so worth considering and that is significant saving


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## eireann (30 Dec 2009)

Thanks for that.

Our net incomes are:
Child benefit €300 p/m
My income €1900p/m but this varies according to the exchange rate
Spouse €2300 p/m

Regarding the mortgage we applied for a top-up not a remortgage so it would only be the top-up at the new rate. Thank god for tracker mortgages!!

I travel about 70 miles daily for work so it does add up on diesel. Ideally i would love a job closer to home. I am a healthcare professional so finding something closer at the moment doesnt seem possible with the current embargo on recruitment. My husbands van is also used for work for tools etc so getting rid of one car isnt an option unfortunatley.

I should have been more specific with the ESB. We are actually with Bord Gais. We have underfloor heating which runs off the electricity so thats why it seems high. It is our only fuel cost and is about €1800 in total for the year. But maybe that is still high and is something we should look into.

As for the childminder her rates are pretty average in this area and to be honest i gladly pay the money as she is excellent. It might be possible to negotiate a reduction though so i will definately give that a try.

Will consider dropping the home phone. We only have dial-up so would loose that but theres always the library! And i would be interested in the FTA too so i must look into that.

Thanks for those suggestions.. Would love some more advice on consolidation of loans etc now i have clarified the situation.


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## LLDLY (31 Dec 2009)

How do you transfer monies from Sterling to Euro?

Using your regular bank might be costly, maybe you should look into using a companies like HIFX.


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## circle (31 Dec 2009)

How secure is your partner's employment? I'd be loath to even do the sums on you giving up paid employment - even if it worked out ok-ish for a couple of years, you're going to be a much better position in a few years' time if you are both working.

As a healthcare worker, it would be worth your while to work out what you would get paid in the HSE rather than the NHS, generally the salaries, allowances etc. are higher with the HSE so it could be worth focusing on finding employment here instead. The scales are here: [broken link removed]

Working in private healthcare here might also be an option if the HSE hiring ban is blocking all options - nursing homes etc.?

Your current situation:
Income - 4500
Spending - 2804 (including mortgage of ~920 and assuming that you could get the childminder to take both children for 900)
Loan repayments - 1295
Spare cash - 401

Dropping phone and Sky (you should do this):
Income - 4500
Spending - 2697 
Loan repayments - 1295
Spare cash - 508

However, at the moment you actually have spare cash of about 800 as you aren't paying for the second child's place yet. If you're not making ends meet currently, there must be somewhere else your money is going.

Theoretically, you could plough this spare cash into your overdraft and credit card and then into your loans.

What rate were you offered on the top-up? You could top-up over a short period (3-5 years) to give yourselves the breathing space if the interest rates are lower than what you're paying now, but you would really need to focus on getting your income/expenditure right not building up a credit card debt again.

The worst thing you could do would be to use a top-up to give yourself short-term financial security, give up or reduce your hours while this is in effect and then find yourself in the same position, except with only one income in a couple of years.

Best of luck


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## AlbacoreA (31 Dec 2009)

I haven't done the maths, but having two incomes gives you one to fall back on if one of you can't work, or loses a job. At the moment, unless its unworkable, I would be loath to give up an income, unless you really had to.


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