# going nowhere



## derossi (26 Jun 2008)

Age: 26
Spouse’s/Partner's age: single 

Annual gross income from employment or profession: 51000
Annual gross income of spouse:0

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

In general are you spending more than you earn or are you saving? not really, i generally have money but feel like i am going nowhere with it!

Rough estimate of value of home :renting
Amount outstanding on your mortgage: 720 per month
*What interest rate are you paying? *

Other borrowings – car loans/personal loans etc
18000 left, car loan, 456 per month
6600 left, personal loan, 255 per month
sky 72 per month
esb 60-80 per month
broadband 35 per month
car tax 390 per year
insurance 145 per month
above is most of my fixed outgoings


Do you pay off your full credit card balance each month? no
If not, what is the balance on your credit card? 1500

Savings and investments:
165 per month to irish life for an investment fund, just finished the second year.
Do you have a pension scheme? 
normal work pension. it is around 15 euro per week. for around five years now.
Do you own any investment or other property? no

Ages of children: none

Life insurance: none


*What specific question do you have or what issues are of concern to you? *
*i hope i have given a good enough insight to my finances above. feel free to ask any questions.*
*the main problem i feel i have is that i am going nowhere. generally speaking i spend more or less what i want(to an obvious limit). i have a relatively serious debt and feel that im kinda going the wrong way in my finances. i could sell my car tomorrow and be left with a 6 grand debt plus my credit card and could probably pay that loan off in a year and be left debt free. although im not sure if i need to as such. i know some will say why are you paying 700 odd in rent a month? maybe i am answering all the questions myself!! to be honest i am hopeless with money and what i want is somebody to lay it out straight to me on what i should do? i never looked for advice on finance before and generally just plodded on with it!!*

*can someone please take a look at my finances above and tell me straight how i should go from here? be as harsh as you want, i think i need it. *

*thanks in advance!*


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## PM1234 (26 Jun 2008)

Just checking that your savings figure is accurate €165 a month? Is that your monthly saving in total?


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## derossi (26 Jun 2008)

lol, i can sense the disbelief in your question, yes 165 per month. only really an investment thing that i took out one day i was in the bank. bit of a whim really. if it wasnt for that i probably wouldnt be saving anything!!


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## PM1234 (26 Jun 2008)

Apologies - I didn't mean come across as disbelieving at all. I just wondered if you have a balance in your current a/c perhaps?


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## derossi (26 Jun 2008)

dont apologise, im a bit sensitive about my finances, as of 2 mins ago there is 4,566 euro in my account....


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## sam h (26 Jun 2008)

The key thing that jumps out to me is the car loan.....it's not just you, but I could never understand why people borrow so much for a depriciating asset ??? Why not buy a cheap car & save in a high interest account for as long as it takes to buy the car you want....and start saving again for the upgrade? My dad gave me this advise when I was buying my first car - I wanted to get one on finance & he said he'd match my saving up to £1000 if I saved bought a decent 2nd hand one. I reckon it's the best thing he ever did and I've never had a car loan since (even when I bought new). Mind you, I reckon this will NOT be the month to sell the car....the market is flooded!!

Other than that, you're back to the usual advice - keep a diary of everything, save by bringing in lunches & shopping around for bargains, get rid of high interest loans ASAP. You have no dependants, so you are in a position to make some radical changes at this stage which could change the way you look at you finances for life.

By the way, might be an idea to change the amount of detail you've given about your jobs if you want to keep you identity secret....I'd imagine not too many people fit into this category.




> as of 2 mins ago there is 4,566 euro in my account!!


Just saw this - clear your credit card tomorrow morning & struggle through the month!!  One thing less to deal with next month


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## derossi (26 Jun 2008)

point taken about the detail!! i see what your saying about the car! it does seem like a pointless extravagance at times. maybe i should look at that first. i really think i need a total re-think of what i am doing. at the min i seem to be just living how i please, which ok is a good thing right now but in a few years time i could just be in the same position! so kind of a waste of time. yeah point taken about the credit card. pointless having money sitting there doing nothing while i am paying interest on the cc. i think its the feeling of security knowing i have money to hand to do what i want which is ultimately pointless. maybe i need a real structured plan of what i am going to do or what i want and stick to it. easy said though when your used to the opposite. thanks for the advice tho!


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## so-crates (27 Jun 2008)

Question for you derossi. What do you want to do with your money? Do you want to buy a property? Do you want to go travelling for a while? Do you have any aims or aspirations or life goals?

You seem to earn well and although you have some silly debts (credit card debt of €1500 is particularly silly, you should work towards reducing that sensibly) you aren't in a terribly uncomfortable position financially. I am guessing you have been working in the same job for five years (based on what you say about the pension), are you looking to stay there long term or is some of this soul-searching prompted by thinking about moving to pastures new?

I think you need to sit down and have a serious think about some goals or aims, map out short, medium and long term goals and then plan how you are going to save towards them. It is important to save where you can with a view to just having money in the bank but it is equally important to save towards specific things (say a car ). Something I notice people I know tend to do is fund short and medium term goals with borrowing (e.g. getting a loan for a holiday - short-term goal usually, or for a car - medium-term goal usually). It is probably, at least partially, a sign of recent times: with credit purchased so cheaply there is less incentive to save towards something.

In the interim, you need to focus on not carrying so much debt. Start by focussing on your credit card. You should aim to be paying the balance in full each month. Stop using it, for a while at least, and pay more off the balance. Sit down and work out how quickly you can have it paid off while paying say, €400pm and not using it. Once that is out of the way, I think perhaps look at the personal loan. Is it possible to pay this off early? Or would there be penalties? Investigate and if you can, start paying that down at a faster rate. If it can't be paid fast without penalties that outweigh the interest saved, look at your car HP agreement and apply the same tests.

Once you have decided on your saving goals, start looking at how you want to achieve them. Start by looking at high interest deposit accounts for short/medium term goals. Then start saving into them. Look in the Best Buys section for the best rates, but don't forget to think about how you want to be able to access the funds.

One further thing I would suggest you do is look at having some emergency fund savings which are readily accessible for the unexpected.


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## Flax (27 Jun 2008)

You're not doing too bad.

1. Pay off your CC this month and make sure you survive without getting into debt (i.e. no pubs/restaurants) for the rest of the month.
2. From next month up your savings to around 500 per month.

Regarding the loan, I don't know what you should do.

I used to live like you - I had a good salary and would live without thinking about cost. You know, lots of boozing, restaurants (at least once per day!), clothes... that sort of thing.

I haven't cut things out altogether, but I gave up booze, caffeine and everything that goes with those two... such as kebabs and chocolate and muffins.

I've also reduced the amount of eating out.

The financial difference has been HUGE. Forgetting about how much I can now save per month, the best part for me is I am now aware of every penny I spend. Previously I didn't know where half my money went.

You're young and single, so you'll be grand. Gradually make some changes and you'll be in a great position by 30.


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## Howitzer (27 Jun 2008)

I'm not surprised you feel as if you're going nowhere financially, you earn a very good wage for your age but spend every penny. In fact you have 2/3s of it spent every month before you even receive it because of the large ongoing costs you've accumulated.

It sounds as if you're very easily convinced to sign on the dotted line, even your savings policy was on a whim.

You need to get rid of you ongoing costs.

Sky - 72 a month. That sounds like the most expensive option. Go for the cheapest.
broadband - 35 a month. You can get a better deal, or at the least an introductory offer by churning the market.
ESB 60-80 a month. I don't know how you're spending so much on electricity. Electric storage heaters coming on during the day? No lagging jacket on the immersion? Tumble drying socks one at a time?
Rent - 720 month. Where are you renting? Is this market rate? Would you consider sharing?

It's a little hard to reduce your loans and credit cards without cash coming from somewhere else. I suspect your savings policy can't be touched easily (sounds like something you were sold rather than chose), so your only option is to reduce your outgoings in other areas and channel the savings towards your loans with the highest charging interest first (typically: credit card - car loan - personal loan).

What rates are you paying on you loans/card?


I don't think this is about not living it up like any orther 20 something, you just need to reduce your ongoing monthly outgoings. Stop walking by those shops with the extra large windows.


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## derossi (30 Jun 2008)

Firstly my apologies for not responding until now. thank you to everyone who took time out to respond to my question!!

I want to answer some of your points and give my reaction to some of your suggestions.



> Question for you derossi. What do you want to do with your money? Do you want to buy a property? Do you want to go traveling for a while? Do you have any aims or aspirations or life goals?


 
I think this is probably the most important question that i have to do a bit of soul searching to find an answer. i think i have reached a point in my life where i have to decide where i want to go next. time to get a grip so to speak!



> I am guessing you have been working in the same job for five years (based on what you say about the pension), are you looking to stay there long term or is some of this soul-searching prompted by thinking about moving to pastures new?


 
Your right, i have been in the same job for five years. I really don't imagine this current job as being a job for life but the experience that i have gained from it will help me in the future. Yeah again you are right, definitely a bit of soul searching has been going on lately and it is time i decided where i want to go next.



> Forgetting about how much I can now save per month, the best part for me is I am now aware of every penny I spend.


 
My main problem! i haven't a clue where my money goes. i think its time i kept a detailed record of where i spend it. hopefully this will help me realise where i waste it and it will help me weed out wasteful spending.



> It sounds as if you're very easily convinced to sign on the dotted line, even your savings policy was on a whim.


 
Thats me in a nutshell. 'whatever' seems to be my modus operandi! too easily convinced to part with my cash....im a good person to be around on a night out!! well, good for everyone else and not my pocket!



> Sky - 72 a month. That sounds like the most expensive option. Go for the cheapest.
> broadband - 35 a month. You can get a better deal, or at the least an introductory offer by churning the market.
> ESB 60-80 a month. I don't know how you're spending so much on electricity. Electric storage heaters coming on during the day? No lagging jacket on the immersion? Tumble drying socks one at a time?
> Rent - 720 month. Where are you renting? Is this market rate? Would you consider sharing?


 
OK first things first....i am gonna ring sky and go down to the basic package...its really just a waste anyway!! gonna look at my broadband and see if i can reduce it..not sure about my ESB bill,i thought it was cheap but i will definitely look at it and see if i am being wasteful! As for the rent issue, i live in a four bedroom house...it's nice having space and freedom but it makes sense having someone else to help pay the rent. i am gonna get two extra people in to help pay the rent....



> It's a little hard to reduce your loans and credit cards without cash coming from somewhere else. I suspect your savings policy can't be touched easily (sounds like something you were sold rather than chose), so your only option is to reduce your outgoings in other areas and channel the savings towards your loans with the highest charging interest first (typically: credit card - car loan - personal loan).


 
The credit card is gonna be paid off this month and i am gonna tear it up and live without it. I'm gonna cancel the savings thing and channel all my extra money towards paying off the personal loan. the big pink elephant that i have in my drive. i don't need that much of a car to get around..its really only an ego thing anyway. I'm gonna sell it off and pay off the loan and buy a cheaper car.

to be totally honest i probably knew all this anyway but i needed you guys to spell it out for me. again thanks for taking time out to listen to me and give advice!! ill keep you all updated on how i get on with the changes, just to keep myself in check and to show that you haven't wasted your time.

cheers


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## annR (1 Jul 2008)

Hi
I wish I had asked the same questions as you when I was your age!  I had no job, no money, nowhere to live and had to start from zero when I was about 27.

Lay down a few sensible rules now - get rid of your debt, don't borrow anymore, don't pay for a 4 bed house by yourself.  Save a bit more every month and let it build up into an emergency fund.  Once you have acheived that basic healthy financial state, start making plans for the future.


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## so-crates (1 Jul 2008)

Good luck derossi, the only thing I would disagree with you on is the credit card. If it is possible for you to be sensible when it comes to using it, I think you should retain it. An unusual occurrence perhaps, but another poster on AAM recently found that he couldn't hire a car in the US without a credit card as the required the booking credit card for validation on picking the car up. 

What you could do with it, is leave it at home. Confine your spend on it to only specific things (such as booking flights etc). Draw up a short list of the things that a credit card would be valuable for booking things with (say tickets, flights, hotels...) and if it isn't on that list, you don't use the card to buy it.

In any case until you clear your current balance, don't use it at all.

Best of luck in the future
S


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## derossi (2 Jul 2008)

went into halfords yesterday to get some glue to fix a piece of the bodykit of my car.....was walking past the sat navs when i thought ill have one of those...the new tom tom one looks good!!.....just as i was about to ask for some assistance the thoughts of the forum whirled around head...on second thoughts ill leave it...as long as i know how to get home ill be allright


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