# how to start saving?



## sunshimmer09 (24 Feb 2012)

Age: 32
Spouse’s/Partner's age: 32

Annual gross income from employment or profession: €27k (1,800 per month)( work 3 days a week)
Spouse’s/Partner's €47k (3,000 per month)
Children’s allowance €140p/m

Type of employment: permanent (both)

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

*spending*
*1 child *

Rough estimate of value of home €150k
Amount outstanding on your mortgage: €330k 
*What interest rate are you paying? 4.25% variable €1310 p/m*

Other borrowings – car loans/personal loans etc


Crèche €557 p/m
My car €157 p/m (24 payments left)
His car €300 p/m (24 payments left)
Personal loan €175 p/m (36 payments left)
Credit card balance €2500 pay approx €100 p/m
Life insurance €28 p/m
VHI €70 p/m (cover me and baby his is paid by employer)
Car insurance €70 p/m both cars
Petrol €200 month both cars
Toll €80 p/m
Food & nappies €500 p/m
Sky €100 p/m (I know high but it’s our only entertainment)
Mobile phones both paid by company  
Management fees €120 p/m
Loan to parents for house deposit €200 p/m 4 years left
Internet €20
Gas/Electric €100 p/m
Misc €100
*Total out €4187*

Do you pay off your full credit card balance each month? No but have cut the card up


Savings and investments: None

Do you have a pension scheme? Yes (only one)

Ages of children:  12 months

The problem is we just cant seem to get ahead, we are both paid monthly and always seem to go into overdrafts every month we just seem to be chasing our tails. 
Having both lost our jobs in 2009 for over 6 months we have got back to secure employment with guaranteed incomes again.  We really want to start a savings plan. What should we target to save each month?


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## NANA01 (24 Feb 2012)

oK sunshimmer,

If you want to cut your loans and make some savings - you have to make sacrafices and put a bit of work into it.  Im not going to be nice here, take the following advice or just keep sticking your head in the sand - up to you.  Here goes..

€100 per month Sky - your only entertainment - tough - you owe your parents money and you still think its ok to spend this per month.  You want entertainment sit your 12 month old down and start drawings and playing, or stick him/her into buggy and head to park....the times flies and you will have all the time in the world in 10 yrs to watch TV...loads of entertainment all around us thats free.  You dont need SKY.

Creche fees - look locally for a lady to mind - cheaper and quality of minding might just be as good if not better - just takes work and effort to seek her out

€500 - food etc - too much.  Make an effort and go to lidl/aldi - 19p bag of carrots - need I go on.  Make dinner to last 2 days, dont buy crap food - choco/biscuits etc these are the expensive items

Phones free - ye should be laughing

Health €70 pm - too much for 2 people.  VHI doing deal at mo with kids free.  Again do a bit of research and get a package to suit you - you dont need the expensive pacakage if you are young and healthy.  Dont want to **** you off here but if I owed my parents money I would have to make the sacrafice and have no health ins.  but thats your decision

Car Ins for you both - did you shop around to get the best deal? - all these things need work...and I mean shop around - check all the ins companies available.

Mortgage Protection - I presume you are both young and healthy non-smokers etc then shop around!!!!!  go on internet and you will get discount for the first year of mp etc.  you can do this for a few years....Yes you can...put the work in honey

Misc....€100 - what for?  Dont buy presents ,  youve got to explain to people the money aint there..... and most of all you have got to tell yourself to wake up and live within your means.

You can save but you need to sit up and be realistic and put the work and effort in.  Your lifestyle has to totally change.

Dont get me started on the credit card.  If your parents are OK about the money (god bless parents) you have got to clear this cr card debt NOW.  

Can you cycle to work or your hubby....Im doing it daily 48k round trip (and live in west with wind and rain).  Had to in order to cut back.....

Look I see it all the time people looking for help but nobody can help you only yourself, there will be no miracle cure for you on this site only advice - be it cutting from people like me but you CAN DO IT - but you will have to totallly change your attitute - the last 10 years have ruined us.

Also, presume you are like us all, YOU HAVE ENOUGH CLOTHES, we dont need new clothes...they last for years, seriously.  I have  3 kids, havnt bought any clothes for over a year (couldnt affort it) got 2nd hand clothes from family (everybody bought too much during the tiger years), people are delighted to get rid of clothes but some of us are too proud to ask - NOT ME. 

Im going to apologise now as the above might be very severe but some people expect to pay off debts and save but still live the lifestyle they had in the celtic tiger years (am not saying you - talking in general).

Keep a diary of what you spend daily - look at it every night and ask yourself on each item "did i really need that?"

BUY WHAT YOU NEED - NOT WHAT YOU WANT

God bless and hope it works out.


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## niceoneted (24 Feb 2012)

There is 753 left over after you list the ins and outs.

I would suggest the first thing you need to do is start a spending diary as you don't seem to know where that €753 is going. 
I would cut sky back to the basic package for a couple of months until you at least clear the CC. 
Also aim to cut the shopping bill by €50-100 a month. Use this to accelerate the payments on your debts.


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## SPUDZ (25 Feb 2012)

To NANA01...couldn't agree more.Sometimes the truth hurts, and it may seem harsh, but you are spot here in every aspect.


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## dmos87 (26 Feb 2012)

I have to agree here with the previous posters. Tough love is needed, and the priority needs to be on repaying your parents and of course the Credit Card. In order to do that, you need to free up some cash where you can. 

Shop in Lidl / Aldi: I shop here every week and I have to say I really don't notice a difference in the quality. I absolutely see a difference in my pocket though. Shop smart and meal plan. For example, there are two of us. I buy carrots, onions, peas, potatoes and Mince - voila, a Shepards Pie - and it has about 6 portions in it. We have two portions and freeze the remaining for another 2 nights dinners. Thats 3 meals sorted for two people for around 6 euros. I do the same with Lasagne, for about the same cost. you need to plan for lunches too - no doubt (and I don't mean this in a cruel way, I just know from experience and having been where you are now) you are both eating out on some occasions for lunch. This really adds up every week and should be the first to go. The baby items in Aldi's and Lidl are good too, and at the end of the day, a nappy is going to be full of you-know-what regardless of the price of it. You can easily get your weeks shop for your family down to 60 euros with a bit of planning and effort. 

Sky: I can appreciate where you are coming from in terms of your entertainment. It was the same for us when we had debt, and I would have gone LaLa without it sometimes. But 100 Euros is a lot! We currently pay 55 euros a month and thats more than enough for us. We have anytime, which shows new movies each week, and we have the movies package, along with documentaries, music, and a lot more. The only two packages we do not have is News and Sports. Call up Sky and ask them on their best packages for good value, advise them you may need to cancel as the cost is so high. They are likely to offer you a deal on a few months half price, or a new package thats lower. You need to get this as low as you can, but I can appreciate the need for it. You can have Sky, just not every package! And if its multiroom, get rid. Enough said there. 

Car loans: Can you advise if they are with the same bank? It might be possible to merge the two together and increase the term of the loan to give some breathing space. Is this a variable loan or a fixed rate? 

Is it possible to downgrade one of your cars to something smaller and cheaper? This would free up some money to pay off some of the debt that is crippling you every month. You could buy a 1L car which is cheap to run all round and use the remaining money from the sale to clear the debt. Your tax and insurance costs would reduce, as would your petrol expenses. 

VHI: Absolutely too high for the two of you, unless there is something we do not know about i.e. a medical condition, smoker, etc. Shop around, there are some good deals online. check if hubby's policy will allow you two to be added to it, the cost might be lower than you are paying now. 

Travel Expenses: You need to look into the option of car pooling - whether thats together or with other work colleagues. Is there anyone at work that travels from your direction? I am sure they'd be happy to cut down on their costs also. Ask around, and you may be surprised. I did this for a period of time and it was nice to have company in the car and have my weekly costs reduced. At the amounts you are paying, is it an option to perhaps use public transport or cycle as one poster mentioned? The cost of a monthly bus pass would be around the cost of the tolls you pay and you would see a dramatic drop in petrol costs. 

Internet: Get rid of this for now. Unless either of you do work from home, it is not needed right now and is not a priority. You can always use an internet cafe or perhaps a work PC if online access is needed. 

Gas/ Electric: Do a lap of the house every morning before you leave and again in the evenings. Make sure all items are plugged out and the sockets are switched off (if those are the ones you have). Leave nothing plugged in. You would be surprised of the difference this would make. 

Car Insurance: Shop around for better deals - between you both you pay 1,680 per year. You can definitely get this down. I have a 1.8L petrol car and I pay 400 a year fully comp. Hubby has a 1L car and pays about the same. Try and pay this in full if you can as it reduces the cost. I know right now this might not be an option but going forward. 

Creche: As someone else mentioned, you can get this cheaper if you find someone locally who is willing to mind your baby. Keep an eye on local signs, and put one up yourself for someone. Even if the cost was reduced by 100 euros a month its something. 

All of the extra money you free up needs to be directed to the credit card first as you are probably paying a large interest amount. Once this is cleared, build up that nest egg to repay your parents. Focus on one debt at a time. 
All in all, you are both very fortunate. You have a nice home, a healthy baby, and two permanent positions with good wages. Are you claiming all your tax credits for refuse, etc.? Look into this. Make sure you have claimed your tax back for the last few years. Get money smart - the spending diary is a must. You will be shocked where your money is going. you can definitely free up an additional 400 a month with the above tips, and thats just between the shopping bill, sky, internet, and shopping around for better deals. All you need is focus and planning.


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## sunshimmer09 (28 Feb 2012)

Thanks for replies dmos87  & NANA01 I completely agree tough love is required!! The credit card stupidly built up when we were both unemployed and I haven’t made it a priority paying it off.

There is no point me defending a lot of my stupid spending.  The crèche is one I feel I can justify.  I was using a childminder and it was €100 cheaper a month but ran into a lot of problems, she was sick, she twisted her ankle she needed to take days off several times over short periods for weekends away texting me at 5am saying she couldn’t take the baby that morning.  It was a nightmare work wise asking for time off at short notice or calling in sick to suit her schedule in the end we decided crèche was more reliable for  us and its work out really well.

My €100 misc seems to be spent, chemist for teething products, doctor for baby, baby clothes.

Our car insurance is quite low actually 350 me and 500 for him, I’ve shopped around and can’t do any better the same with the life policy 28 a month I couldn’t get one broker to beat it.

My priority this morning is to call sky and downgrade package and call VHI to see if I can reduce cover, I would hate to give up the health insurance after paying into it for so long but if needs must.

Unfortunately neither of us can take public transport to work, I drop the baby and he collects and we both work in opposite directions I would love to take a bus in the morning it just doesn’t work.  I don’t use my car the days I’m not working I drive everywhere. 

Food shopping, I do use a lot of convenient food, expect for babies which I prepare fresh and freeze and I’m really going to try and get better, I’m going to go with cash to the supermarket and just tell the checkout girl to stop at €80 and leave luxuries at the end I definitely know it’s an area I can improve on.

I’m also going to set up a small enough direct debit for saving each month from both accounts, I read somewhere pay yourself first –going to try it out.

Thanks for advice sometimes you need to hear it from outside to actually hear it!


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## Slim (28 Feb 2012)

Hi. All of the advice above is very good. It seems tough but you have the right attitude. Tackle this now. The credit payments are sucking the lifeblood out of your life. They total €932 per month, not counting your mortgage. It would be important to focus on clearing the credit card debt first. Next could be the car finance. Are they HP or personal loans? As already posted, try and amalgamate these into one loan. Are you members of the local credit union? Perhaps they could consider amalgamating some loans for you. Would your parents(in-laws) allow a moratorium on your repayments to them to allow you to reduce some of the other debt. When the car loans are cleared, you will free up €457. Perhaps you can try not to change the cars but trade down etc.

Consider ending your Sky subscription. If you do, you can get many channels as Freeview, including some movies and loads of news channels. Look into your overall homephone/broadband package. Do you need a homephone?

Health insurance is comforting but there are cheaper deals out there. Use HIA website to compare costs. Cover for child is considered unnecessary by many.

As pointed out above, you have a mystery €753 unaccounted for. This may be newspapers, snacks, coffees, takeaways etc., perfectly natural but unnnecessary and maybe bit of a habit. 

Shopping can make a difference, as posted earlier.

Overall, concentrate on the credit and the optional expenses, Sky etc. Best of luck. Slim


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