# Best way to clear debts and save for college



## lemsip (24 Apr 2009)

Age: *23*
Spouse’s/Partner's age: N/A

Annual gross income from employment or profession: *25K*


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

In general are you:
(a) spending more than you earn, or
(b) saving?
*Saving*

Rough estimate of value of home *N/A live with parents rent 400 pm*


Other borrowings – car loans/personal loans etc 
*personal loan 2435 outstanding, paying 160pm*
*credit union loan 300, paying 100pm*

Do you pay off your full credit card balance each month? No
If not, what is the balance on your credit card? 
*1188 paying 10% of balance pm. dont use card anymore.*

Savings and investments:*3425*
*AIB 7day notice acc. balance 2800*
*online savings plan- saving 50pm balance 525*
*Parent saver account-saving 100pm balance 100*

Do you have a pension scheme? *no*

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

Ages of children: *1.5*

Life insurance: *No*


*What specific question do you have or what issues are of concern to you? *
I'm hoping to go back to college in October, I finished a degree two years ago but don't want to work in this area. I've found a course I really want to do and need to find a way to afford it. Its a four yr course and I will have to pay fees of ~7K per year. 
First of all I am looking for advice on the quickest way to clear my credit card and loan. I was thinking of increasing the repayments on each to 200pm and then saving a further 400pm into my savings account. By September I should have the cc cleared and loan down to ~1000. Savings would then be ~5825. I could get a top up of 1000 on my loan and pay my fees.

Or I could use my savings to clear loan and cc now? That would leave me with ~800pm to save, so 4800 after 6 months. Id have to borrow 2000 then to pay my fees.

I'm really don't know what to do and sorry if this is confusing. Basically I don't even know if I can afford to go back this year or whether to save and wait until next year. But I really want to get it over with while my child is young, then starting work and providing a stable home of our own. I'll qualify for lone parents while in college so will be getting ~1000 pm and can do grinds etc. to keep me going while in college. I'll also work during the summers to try save the next yrs fees but will probably have to take another loan at that point.

I'd really appreciate some views on this, if people think I'm mad for giving up a permanent job now or if anyone has any advice!

Thanks.


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## legallady (24 Apr 2009)

Use your savings to clear your loans and creditcard. It's a no brainer. 
Are you getting money from your childs father? Do you get childrens allowance?

also, do you have to do another four year course? Could you not do a post grad for a year or two and it would more or less give you the same thing?


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## lemsip (24 Apr 2009)

Thanks for your reply Legallady.

I thought that was probably the best option alright, but was worried about not having any savings and also that it might be easier to get a top up on the loan rather than have to get a new one. How do the banks view this?

Child dad pays half of the childcare fees at the moment. Yes I get childrens allowance 166pm at the moment but I expect that to be reduced next yr with cutbacks on SW so not really factoring that or early childcare supplement into my budgets.

Unfortunately there is no other way to get into this area (nursing) without going back as an undergraduate. My 4th yr will include a 9month paid placement so can start paying back loans at that point. Also child will start school when I am in 4th yr so less childcare to pay. 

I just have to hope there will be jobs in this area when I qualify!


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## Gus2008 (24 Apr 2009)

Hi Lemsip,

Do you have a credit union savings account? If so, could you combine your existings loans into one seeing as you only have 3 payments left on your exisiting credit union loan? At present, you're paying €380 in loans and €150 in savings. You could make this work better for you by having one loan @ €480 and saving €50 a month. A loan of €4,000 (€2435 + €300 + €1188) would be cleared in about 10 months at that rate of repayment. 

Alternatively, use your savings to get rid of credit card debt and pay off the balance of your CU loans next month (€100 usual payment, plus €120 you would've been paying off credit card).

If at all possible, I'd recommend trying to leave a chunk of your AIB Savings untouched as you may need to rely on that when you're not working anymore. 

Hope it works out for you!


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## Firefly (24 Apr 2009)

Hi Lemsip, have you heard the recent news regarding the planned nurse cuts in the HSE? Don't have all the details but it might be worth finding out before you sign up for a 4 year course.


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## lemsip (17 Aug 2009)

Well I got a place on the course today but don't know whether to defer it for a year. The fees are now 7337, I have savings to cover the first half but will need a loan for the rest. And then another loan for the other 3 years. I still have a loan for 1500 outstanding.
Am I completely mad trying to do this? Half of me thinks its crazy and will be such a struggle, the other half wants to do it so bad and doesn't want to wait another year! How do I decide what to do?


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## legallady (17 Aug 2009)

Do it! Well done on securing a place. It is a good job and very rewarding to those who are passionate about it. You'll be far happier with yourself in the long term. The money will come from someplace. You'll find a way through it.


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## Brighid (17 Aug 2009)

The fact that you got an offer is an indication that it is for you, go girl!


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## Bronte (18 Aug 2009)

Go for it, you're motivated and young.  Well done on securing the course.


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## lemsip (19 Aug 2009)

Thanks for the replies, that what I want to hear as I REALLY want to go for it, but its the finances holding me back from accepting. I'm stuck for tha moment trying to decide what to do, have applied for a loan for 15K over 5 yrs, that will cover the first 2 yrs fees and I will be able to manage the repayments (just about!) So if it is granted then I'll accept the offer I think! No other options I can think of at the moment.


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## legallady (19 Aug 2009)

good on you girl. Dont forget also that you can work during your holidays. Look into bar work which might suit when your child is spending time with her father. Also, start doing the lotto!


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## so-crates (19 Aug 2009)

Not to say "don't do it" but rather just to play devil's advocate. All other things being equal (so having the same offer open next year) what financial position would you be in in a years time? Would you be clear of your loans? Would you have built up more savings? Would you need to borrow less?

Just to suggest, it might be worth inquiring of the college as to whether you could defer accepting the offer for a year in order to put yourself on a more secure financial foundation. It would remove the anxiety of applying again and assuage the anxiety of not yet having cleared the existing loan.


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## ontour2009 (21 Aug 2009)

_With fees more then likely coming back next year do it this year, and best of luck with it_


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