# 22yr old looking to clear loans and start saving for deposit



## narwog (12 Jun 2009)

*Age*:  22

*Annual gross income from employment or profession*: €41000

*Type of employment*: secure

*In general are you*: spending more than you earn, 

*Other borrowings – car loans/personal loans etc:*


   €12000 car loan from BOI. 3 years left. 
  rate 6%.                        repayments €380 per month

  €13000 personal loan from Credit Union.
  rate 8% 5 years left.      repayments €270 p.m.

                     Total loan repayments: €650 p.m



*Do you pay off your full credit card balance each month?* No
*If not, what is the balance on your credit card*? 3500



*Savings *: €3000 in credit union secured against €13000 personal loan
                  €1000 in BOI easy saver account

                  Currently putting €400 p.m into the BOI savings account



*Do you have a pension scheme?* yes

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

*Life insurance:* 25e per month


*What specific question do you have or what issues are of concern to you?*

  Reckon ill be looking to buy a house some time in 2012 so basically I need to clear the debt as soon as possible and start building up a deposit. With my job I can reasonably expect to receive an €20000 lump sum probably at some stage in late 2011/early 2012.

  My income is €2400 net p.m. I dont pay rent at the moment, biggest annual cost is keeping the car on the road. I have no dependents so my money is my own. At the moment approx €1200 p.m goes towards servicing loans/credit card/savings, I think this money could be used better but not sure what strategy to adopt over the next 3 years.


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## WaterSprite (12 Jun 2009)

*Re: 22yr old looking to clear loans and start savinf for deposit*

First, you should stop the BOI savings and clear your credit card every month.  If you can pay extra towards the loans, then do that with what's left.

€2400 disposable is a fair whack when you're not paying rent - what do you spend the other €1200 on?  Bound to be some savings there...


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## narwog (12 Jun 2009)

thanks for the reply.

realise the credit card is the big one, was kinda thinking though that i'd build up my savings for another year and then use it to clear the car loan, thus giving me an extra €380 per month.

then over 4-6 months use that extra plus the 400 savings p.m to get rid of the credit card altogether, what do you think?

i do a lot of adventure sports which cost a lot, basically i cant see myself getting rid of the credit card debt for the next 12 months. i have other casual income from the sports that i periodically use to clear the card and then it just builds up again.


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## krissovo (12 Jun 2009)

*Re: 22yr old looking to clear loans and start savinf for deposit*

What possible job do you have as a 22 year old for the state that pays €41k a year with the prospect of a €20k bonus?

Am I missing something?


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## narwog (13 Jun 2009)

*Re: 22yr old looking to clear loans and start savinf for deposit*



krissovo said:


> What possible job do you have as a 22 year old for the state that pays €41k a year with the prospect of a €20k bonus?
> 
> Am I missing something?



its not a bonus. 

would rather not say what the job is, been doing it since 2004 and dont want a public service pay discussion to begin.....


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## WaterSprite (13 Jun 2009)

*Re: 22yr old looking to clear loans and start savinf for deposit*

The credit card debt is going to be at a higher interest rate than either the car loan or what you can earn on deposit.  I'd deffo clear that credit card asap and then work towards the next highest interest loan (car loan?  personal loan?)  You have to be clinical and mathematical about interest rates etc. It feels good to save, but, in the end it's not worth as much if you save at e.g. 4.5% but are paying interest at 18%.  The numbers don't lie.  At the very least, divide up that 400pm and put it to each loan in different proportions - every month.

€1350 pm to spend on misc items and hobbies (even expensive hobbies) is a lot - again, I'd say that there are bound to be savings.

Krissovo, I don't think your question is pertinent to OP's question - these are OP's first posts and I'm happy to let him/her ask his/her questions without looking for ancillary information.

Sprite


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## WaterSprite (13 Jun 2009)

*Re: 22yr old looking to clear loans and start savinf for deposit*

You can also sell the car and buy a cheaper one.  €12k is a lot to spend on a car, no matter how often you are heading to the wesht for windsurfing/scuba!


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## krissovo (13 Jun 2009)

*Re: 22yr old looking to clear loans and start savinf for deposit*

Agreed, and I apologize for the way I asked.


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## narwog (13 Jun 2009)

*Re: 22yr old looking to clear loans and start savinf for deposit*

cheers again, you're telling me what i know but just dont want to hear! suppose ive been kinda relying on the promise of the future lump sum to clear everything rather than cutting back now.

credit card is necessary but will probably reduce the limit to under €1000, bit more manageable anyway.



WaterSprite said:


> €1350 pm to spend on misc items and hobbies (even expensive hobbies) is a lot



one word. skydiving


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## narwog (13 Jun 2009)

*Re: 22yr old looking to clear loans and start savinf for deposit*



krissovo said:


> Agreed, and I apologize for the way I asked.



no worries, im not defensive about my occupation in the slightest but have experienced discussions on other fora that went postal at the mention of PS workers earning anything greater than the minimum wage


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## WaterSprite (13 Jun 2009)

*Re: 22yr old looking to clear loans and start savinf for deposit*

Well now, people who throw themselves out of perfectly good planes are just (plane) crazy....

Try to cut back even a little now, even €200 extra a month, and deffo put those savings against the loans - you may be pleasantly surprised at how much of a dent you can put in the debts.  At 600pm (400+200), that credit card bill will be gone in 6 months!


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## narwog (13 Jun 2009)

thanks for the advice


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