# Struggling - Family under strain / Down



## pmurphy (12 May 2010)

Age: 37
Spouse’s/Partner's age: 35

Annual gross income from employment or profession: 36748 pa
Annual gross income of spouse: 10000 (avg)

Type of employment: e.g. Civil Servant, self-employed : Private Sector, employed for previous 6 years with this company
In general are you:
(a) spending more than you earn, or
(b) saving?

Spending everything we earn. Living on a very small amount per week.

Rough estimate of value of home : 213k
Amount outstanding on your mortgage: 197K
*What interest rate are you paying? 1.25%* Tracker

Other borrowings – car loans/personal loans etc 
Tesco Personal loan - 21K (491 pcm - 47 months remain)
Halifax Personal Loan - 13K (371 pcm - 35 months remain)
Overdraft - 3000

Do you pay off your full credit card balance each month? 
Meeting a little over min repayments only
If not, what is the balance on your credit card? 
C/CARDS - 5000
Wife - 4000

Savings and investments:
None 

Do you have a pension scheme?
Yes. 

Do you own any investment or other property? 
No

Ages of children: 
6 years old

Life insurance: 
N/A

Nett Pay is 2458.00 pcm, Wife lost previous job and now works for event company, she does all the hours she can, never refuses work - Average income per week is about €160.00  

While mortgage and loan repayments are always met and indeed prioritised we are are giving ourselves a budget of max 180.00 per week to live off sometimes less.  The slightest thing can really cause us huge problems

Important bills per month
Mortgage - 749.00
Halifax - 371
Tesco - 491
Halifax CC - 151.00
MBNA - 100.00
Ovedraft -31.00

Essentials - 
Landline - 54.00
Esb / Gas - 120
Life and Home insurance - 66.00 (Ulster bank and 123.ie)
Bins - 23.50
Pet insurance - 22.00 

Non essentials - 
Sky @ 49.00 pcm - Obviously this will go

Neither of us smoke or drink or go out out. Cant remember the last time in a pub. We shop in Lidl/Aldi etc, No gyms, no clubs, no bill pay mobiles

On paper we are managing just about due to frugal budget / prioritising loan repayments etc, however everything is a worry, clothing for the child, school books due in the summer, TV license reminder arrived... The Tesco loan was taken out to buy a new car ,to pay for our wedding and one week away in France and huge vet bill for prevous family pet (hence the insurance for new animal).  At the time we could afford it, now due to dramatic changes in circumstances (pay cuts, hours cut, not as much work etc) we are struggling.

Our car was bought for €3000.00 and my wife uses it to get to work as no public transport avaialbe at this time of night where we live/ 50KM drive etc, I use public transport (annual tax saver ticket).

I have spoken to my bank but they said it would be unlikely that they could combine the 2 loans as both are from different banks (Tesco, Halifax) as banks are currently not keen on this. We are on such a tight budget getting rid of the credit card debt is nearly impossible, miniumum payments made but often we find ourselves doing the shopping or paying for something with the last 100 euro on the credit card..

Should we just tough it out for another while and hope things pick up or do we have any other options?

Many thanks
PM


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## Colndas (12 May 2010)

PM,

Based on what you have said you are hanging on by your fingertips and something minor could tip you over the edge. One question that I have is, Are you worried about your credit rating? 

If you are looking at surviving through the times facing you then I would suggest that the answer should be no.

As far as you and your family go, the most important bills in order should be 
1) Keeping the roof overhead
2) Paying for food and keeping the house in heat and light
3) Being able to pay for transport to and from work including any loans secured on vehicles.
4) having some money for emergencies
5) Spending some money on stress relief, i.e. one night at the pictures or getting dvd a bottle of wine and keeping sky although probably basic plus kids channel. This situation is stressful and you need some relief from it, I am not suggesting clubbing nights just something relatively inexpensive.
6) Whatever is left over should be distributed amongst your remaining unsecured borrowings in a manageable plan. This may mean a restructuring of the debt with the lender over a longer period which will cost more.

That means cutting up the credit card and getting a prepaid card so that you only spend what you have. 

My suggestion would be to do an income and expenditure breakdown, write to all of the lenders and enclosing the income and expenditure and tell them your situation. 

Open up a new bank account with a zero overdraft so that you are only paying what you have and are not looking at a minus balance wondering when they are going to cut the overdraft off and watching bank charges rack up every month. Switch all of your DDs to that account.

You may find that you are threatened with your credit rating being affected but it sounds like a loaves and fishes situation and the unsecured lenders will play ball once they see that you are being reasonable in your approach to them.

In addition I would look for cheaper alternatives to your utilities.
Check that you are getting your maximum tax credits.

And be prepared for a few battles.

Col


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## Colndas (12 May 2010)

Sorry and one more thing, I would look for life insurance to cover not only the mortgage but the unsecured debts too. If either of you die they will still remain.


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## Mpsox (12 May 2010)

Hate to state the obvious but you are the classic example of the celtic tiger cub in trouble, €47k in personal debt and little to show for it. 

Firstly don't forget that every month you make your payments, your debts are reducing and you are getting closer to getting out of the mess. 

Secondly, review your tax and ensure you are claiming relief for everything you are entitled to, eg bins, union subs etc etc. Every little helps

Make sure you have switched to Bord Gais/Airtricity for electricity

review the home phone, do you really really need it and are there better deals out there? 

Are there any assets you can sell, a car boot sale of unwanted wedding presents for example?


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## niceoneted (12 May 2010)

Have you tried switching your CC's to ones that provide interest free periods, if not do as it will help reduce the balance. 
The sky has to go or at least get the basic plus kids which will cost €24 p.m.
Gas should be non existent for the summer months ( I invested in some nice cheap fleece blankets/throws and use them on chilly evenings). This saving will helps with school books/uniform. 
Does the land line also include broadband and are the calls included ( I get national and UK landline calls included for example) if is includes BB and the free calls it's decent rate if not shop around. 
Is there any way to get bins cheaper - I was paying yearly sub and found out I could buy the bin for €40 once off payment each for green and rubbish one - I buy tags now to put them out €10 rubbish, €5 for green bin. I own the bins. 
The only other think is of there is any other means of bringing in extra money, perhaps your wife might do after school care for one of your childs class mates or anything. I know things are thin though. 
Best of luck you sound determined.


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## Guest110 (13 May 2010)

Would you not install freesat ? It would cost about 150 to install it in one room or about 300 to install it in 3 rooms ? This will eliminate the tv bills. If you cannot afford that - just use an aerial. 

Also, would you be interested in recycling ? I have 5 bins in my shed. Each one is filled with a certain type of recycling product. About once a month I bring these bins down to the recycling centre and just throw them straight in as they are already sorted. It costs me 4 euro a month for a plastic bag tag and 2 euro for the recycle centre - which is 6 euro per month.

I know I am on my own - but recycling really does make a difference in the pocket !

I am not educated enough in the insurance area (so no attacks please) - but do you really need life insurance and house insurance? I know house insurance is important - Can you eliminate them for a year until you get back on your feet ? Does your mortgage protection not cover the mortage if you die - mine only costs me 300 a year and my mortage was for 175k. If I do die - hopefully no time soon - my next of kin- will get my home + 3 years of my salary from my employer + my pension to live off !


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## Elphaba (20 May 2010)

Cut up your credit cards. You can have a statement of income prepared by Mabs and they can negotiate with Halifax on your behalf to have the interest frozen on your account so at least you will begin to reduce this debt. 

Go out and have some fun, it doesn't have to cost much e.g. get the dart out to howth and eat a bag of chips by the sea and forget about your troubles...

...or check out Fas's new courses...

'How to slip in the window of an art gallery and rob a few picassos.
'How to forge famous paintings'
'How to rob a bank and get away with it'...they even supply the plans!
'How to become a politician'
'How to predict volcanic eruptions; you'd make a fortune!


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## PaddyW (21 May 2010)

If you get on to MBNA, they may reduce or halt the interest rate you're on. I rang them last year at one stage and they dropped it down, no questions asked.


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## Marietta (7 Jun 2010)

alexandra12 said:


> but do you really need life insurance and house insurance?


 
House insurance is vital especially given last winter's weather pattern, maybe you could consider give up the pet insurance for a while and save €20 odd euro a month, if you pet is young and healthy there is no need for it.  It would enable you to get a pizza and bottle of wine one night a month and you deserve it.


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## pmurphy (13 Sep 2010)

Thank God we didnt give up the pet insurance..just got a bill for nearly 520.00 from Vet for sorting out our pet over last month.

I very nearly gave it up.


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