# trying to sort out finances advice please



## busymum (19 Mar 2008)

[FONT='Verdana','sans-serif']Age: *38* 
Spouse’s/Partner's age: *40
*
Annual gross income from employment or profession: *30k*
Annual gross income spouse: *75k

*Type of employment: e.g. Civil Servant, self-employed  *PAYE sector*

Expenditure pattern: In general are you spending more than you earn or are you saving? *spending

*Rough estimate of value of home   *400k
*Mortgage on home    *orig 140k bal 108k. top up 30k, bal 25k* 
Mortgage provider: *ebs*
Type of mortgage: Tracker, interest only, fixed rate       *tracker*
Interest rate  *5%*

Other borrowings – car loans/personal loans etc[/FONT]
*[FONT='Verdana','sans-serif']Pers Loan 6700, o/d 2000, o/d (spouse) 1500 [/FONT]*
[FONT='Verdana','sans-serif']
Do you pay off your full credit card balance each month? *no*
If not, what is the balance on your credit card? *Visa 4600 Mastercard 3000*

Savings and investments: [/FONT]
*[FONT='Verdana','sans-serif']C/U 1k, ebs surecert 5k[/FONT]*[FONT='Verdana','sans-serif']

Do you have a pension scheme? *yes*

Do you own any investment or other property? *no*

Ages of children: *9,6,4*

Life insurance: *180k each*


*What specific question do you have or what issues are of concern to you?*[/FONT]
*[FONT='Verdana','sans-serif']Should we transfer our mortgage and top up to cover all outstanding debts, or just take out one loan to cover credit cards pers loan and o/d’s. [/FONT]*

Having cash flow problems, seems to crop up every now and then over the last few years , want to try sort out finances once and for all. Mortgage and loan balances don’t seem to be reducing. We need to change one car and possibly update the second, seem like we will never have savings to do this, if we don’t sort ourselves out.
 So far have
 Switched to Tracker mortgage about 4 months ago interest rate reduced to 5%.
Cut up M/C as highest interest rate concentrating on clearing this balance 1k paid since Jan.
Visa paying just €150 per month, not getting anywhere with this as lower int rate than M/c  and trying to clear this first. 
Applied for Halifax/Tesco Credit cards to switch as much of credit card balances to 0% interest on balance transfersas we can, waiting for them to be issued.
Started a daily cash diary to monitor spend.

Any advice would be greatly appreciated.


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## michaelm (20 Mar 2008)

Your finances look okay to me, if a little untidy.  If it were me I wouldn't be inclined to get any roll-up loans or remortgage, as that can become cyclical - might your mortgage 'top-up' been intended to sort your finances 'once and for all'?  I'd use the 6k savings to wipe out the OD's and the Mastercard and I'd reign in my spending (spending diary is good idea) to free up cash with a view to clearing the VISA (no harm moving this to 0%) and the personal loan within 12 months.  I'd put off replacing cars as long as possible and to save up in order to do so.  You should work out a monthly (and yearly) budget and work off cash.  This may be more painful that the roll-up/new cars solution but IMHO 'pain is good' in these situations and will make you mindful not to run up future debts.


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## Mpsox (20 Mar 2008)

I'm confused as to your mortgage, you say you have a fixed rate tracker which is interest only. If it is interest only, your balance will never reduce and how can you have have a fixed rate tracker?

you'ver around €18k in non mortgage debt, given the equity you have in your house and what I imagine low mortgage payments, a top up of your current mortgate to clear those debts might make sense

You should also take a long hard look at your tax situation to ensure you are claiming everything you should be


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## michaelm (20 Mar 2008)

Mpsox said:


> I'm confused as to your mortgage, you say you have a fixed rate tracker which is interest only. If it is interest only, your balance will never reduce and how can you have have a fixed rate tracker?


It's a Tracker.  The answer is the one in bold, the question is a 'delete as appropriate' type.


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## Flax (21 Mar 2008)

You earn 105k per year and have a small mortgage. How is it possible you can only afford to pay a maximum of €150 per month on your credit card bill?

Have you written down your daily outgoings to see where the money is being wasted? E.g. A couple of lattes per day, expensive lunches, booze, etc.


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## busymum (21 Mar 2008)

we are just paying €150 per month on visa as it has a lower rate of interest than the mastercard which we are trying to concentrate on and pay €300, hope to clear that by end of year. The personal loans command a monthly payment of approx €450. the o/ds are ongoing. Along with the regular mortage and childcare i feel this is as much as we can do at present without altering our current lifestyle too much. although we are definitely trying to be more sensible in our spending habits

regarding the savings of €6k, €5k of that is in a sure cert to mature in Nov (balance of ssia intended for a trip to disney in a year or 2) which i try to hide from ourselves. the remainder is CU that we hope to try and build on so don't really want to touch this if poss.

Michaelm- re replacing the cars although it would be nice to change them one certainly could do with replacing you have confirmed my own thoughts on trying to hold off for a while to see if we can pay off some off the short term debts. The top up was indeed a tidy up a few years ago but we seem to be going in circles, and heading back to square one, hence the request for advice. my problem i suppose is that i want it sorted now, and as it did take some time to get into this position it will not get sorted overnight! Our cashflow was a bit of a problem so we lengthened our mortgage term a little and changed it to a 5% tracker. I'm not sure that perhaps we should have changed mortgage provider. is it too late to change - will all our changes reflect badly on our ICB report? 

Flax - we have been writing everything down in a cash diary since mid Jan, its amazing to see where the money is going. There are certainly some areas that could do with cutting back esp the lattes! although they are only a once a weekly treat after the shopping! we came straight home yesterday and had the coffee at home! the cash diary has highlghted areas where we could try to cut back so i suppose its time to put it into action.


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## busymum (21 Mar 2008)

forgot to mention was also considering a personal loan of 17,800 to cancel out our short term debt. tesco are offering 6.9% which over 2 years would equate to €795 per month. As we are currently paying €705 and concentrating on each debt seperately would this be a more sensible option i think cost of credit would be something in the region of €1300 over the 2 years.Currently the credit card interest alone is almost €100 per month and i cannot foresee us having these debts paid within 2 years by going at it the way we are.


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## busymum (21 Mar 2008)

busymum said:


> forgot to mention was also considering a personal loan of 17,800 to cancel out our short term debt. tesco are offering 6.9% which over 2 years would equate to €795 per month. As we are currently paying €705 and concentrating on each debt seperately would this be a more sensible option i think cost of credit would be something in the region of €1300 over the 2 years.Currently the credit card interest alone is almost €100 per month and i cannot foresee us having these debts paid within 2 years by going at it the way we are.


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