# Huge debt: multiple cc and personal loans.



## IAmAStupid (19 Feb 2010)

*Age:*
38

*Spouse’s/Partner's age:*
39


*Annual gross income from employment or profession:*
E40,000 – I get 2950PM after tax + 300 child benefit.

*Annual gross income spouse:*
nothing, she is a house wife

*Type of employment:*
Private sector employee

*Expenditure pattern:*
We are both generally 'savers'

*Rough estimate of value of home*
Living in a rented apartment, E700 per month.
I don’t own a house.

*Other borrowings – car loans/personal loans etc*
Personal Loan 1 (total e14000): e 425 PM
Personal Loan 2 (total e4500): e 207 PM
Personal Loan 3(total e3900): e 105 PM
CC1 (balance 6500): 30 e PM (3.9% interest rate)
CC1 (balance 9500): 200 e PM (2.9% interest rate)
CC1 (balance 4000): 90 e PM (3.9% interest rate)
CC1 (balance 2500): 70 e PM (0% interest rate)
CC1 (balance 2700): 30 e PM (0% interest rate)

*Other outgoings – PM*

Telephone and broadband – 80e per month
ESB – 100e per month
Transport charges (BUS, I don’t have a car) – 60e per month
Food + other.exp. – 500e PM

*Do you pay off your full credit card balance each month?*
Yes, but on special interest rate balances I will pay only minimum.

*Savings and investments:*
e15000 earnings, we put on a investment abroad with a good returns, about 250e PM.

*Do you have a pension scheme?*
No

*Do you own any investment or other property?*
Yes, I have some shares from banks worth now e15000.

*Ages of children:*
5 years and 3 years

*Life insurance:*
Yes – 50e PM

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

I am so stupid to borrow like that and now I am suffering.

Does any one can give me a direction to come out of this huge debt?

Thanks.


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## chlipps (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



IAmAStupid said:


> *Expenditure pattern:*
> 
> We are both generally 'savers'*.......*
> 
> Does any one can give me a direction to come out of this huge debt?  Thanks.


 
I do not understand how you can say that '' We are both generally 'savers' '' -You are Far from savers. To get yourself out of this position, you need to understand how you got into this position. You must have a major spending issue? How long did it take to accrue all this debt? If you are going to continue spending as you are then you will never get it resolved.

1. I think you need to use some of the 15k to clear some of your credit card debt, prioritise the high interest loans... dont use it all as you need some of it for rainy day fund in event that you lose your job.

2. Re-check the interest rates as I suspect that the rates are higher than those that you have specified here

3. Buy everything in low cost providers.. aldi, lidl etc.. cut out the convenience stores

4. Get rid of sky/ntl if you have it and go for free to air

5. what are your chances of getting another job on the side? or even your partner to get some saturday work whilst you mind the kids

6. You need a spending diary and record every penny you spend and month on month try save more than the previous month

7. when you clear a credit card,cut it up and stop using them

Hope this helps

Best of Luck


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## truthseeker (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



IAmAStupid said:


> *Expenditure pattern:*
> We are both generally 'savers'
> 
> *Other borrowings – car loans/personal loans etc*
> ...


 

I dont understand how you cant think you are both generally savers with 3 personal loans and 5 credit cards totalling to 47,600 worth of debt - more than you take home in a year (inc child benefit).

The figures would suggest you are both generally spenders.

You say you have 15K in investment abroad and 15k in bank shares - you should use some of this to clear existing debt - particularly on the more expensive credit cards.

You need to do a spending diary, see where you are spending what and how you can reduce it. 500 a month for food and misc - what exactly would the breakdown of this be and are there areas you could save?

Telephone and broadband seems high as does ESB? Is there any way to reduce the telephone/broadband expenses?

What about another job at the weekends for one of you with a goal to clearing personal loans?

Do you have anything to show for this level of borrowing that you could sell? You dont have a car, anything worth money you could sell off and use the money to pay off some debt?

Id also suggest a major home clear out (clothes, toys, books, ornaments, bits and pieces) and off to a car boot sale - Ive a friend who did it recently and made over 500 quid on just one days clear out of junk.


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## IAmAStupid (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*

It's all my mistake. 

I brought bank shares for 35k and they worth not 15k. I lost 20k there.

I don't have TV at all, only laptop and internet.

I realise now that Credit cards are really a dangerous this when you don't know how to use them.


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## IAmAStupid (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*

chlipps, thanks for your advise.

It's all my mistake.
1. I borrowed to buy bank shares for 40k, now they worth 15k. I lost 25k there.
2. In the boom time I borrowed to invest, now I can't even sell that property.

it's big lesson for me not to borrow to buy shares/invest.

I don't have a TV at all, only laptop and internet.

Now I realise that how dangerous with these credit cards when you don't use them properly.

The interest rates are on special rates I have for 6months and 12 months periods.


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## Romulan (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*

_*2. In the boom time I borrowed to invest, now I can't even sell that property.*_

You did not mention this initially?

You stated you were renting and had no property.

This needs to be factored into the calculations.


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## IAmAStupid (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*

I forgot to mention that I brought a property abroad for 30k. 
Now worth 25k. Trying to sell since 18months, but no luck.


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## Towger (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*

Phone/Internet - Seem high, are they for 2 months?

No Gas, so asuming you are heating via ESB.

Children 5 and 3 - Assuming 5 year old is at school. Depending on 3 year old DOB should be possible to sent them to 'Free' Pre school, which came available from 1st Jan. This would free up wife to do a few hours work each morning, increasing in hours when child enters proper school etc.  

Bus - Get Tax saver ticket. This comes off gross pay before PAYE, PRSI and Income Levy.


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## chlipps (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*

what is mortgage on it vs the rent received. Is the 250 euro per month in first post the profit of rent over mortgage (minus tax)? If yes then this is more income that you can use to address your large debt.

Am I correct in saying that you have 15K invested into a property abroad and that you have a separate 15K in savings? Or is this same 15K?


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## IAmAStupid (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



truthseeker said:


> ..


 
thanks for your options,
I am concentrating since few months to reduce the ESB bill, now I have energy saves bulbs in Kitchen and bathroom as well.
I am looking for part time job in the weekends (I know it's very difficult in this current market situation).
I put up for sale the abroad property since 18 months, but no luck till now. If that is materialised I will be a releived man some how.


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## IAmAStupid (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



Towger said:


> ..


 
thanks for your options.

Phone and Internet charges are per month.
yes, heating via ESB, but it is very min. My apartment is little worm, so I the hearters hardly once or twice a month.
I tried that bus - tax saver ticket which is costing more than I pay now with the monthly ramblers.


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## IAmAStupid (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



chlipps said:


> what is mortgage on it vs the rent received. Is the 250 euro per month in first post the profit of rent over mortgage (minus tax)? If yes then this is more income that you can use to address your large debt.
> 
> Am I correct in saying that you have 15K invested into a property abroad and that you have a separate 15K in savings? Or is this same 15K?


 
I have 15k investment in abroad + 15k worth now on bank shares (originally I brought those for 40k)


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## IAmAStupid (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*

I am little optimestic on these shares in coming months, even if I get my investment back (i.e. 40k) then that will solve lot of my problems.

But, it could go other way and I may lose everything. (i.e. present value 15k as well).

I don't know what to do?


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## chlipps (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*

Again.. what is the 250 euro for? Is this profit after the rent is paid 

or is 250 the rent received per month? If 250 is the rent, then what is the mortgage?


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## IAmAStupid (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



chlipps said:


> Again.. what is the 250 euro for? Is this profit after the rent is paid
> 
> or is 250 the rent received per month? If 250 is the rent, then what is the mortgage?


 

I receive 250 as rent PM after tax for the abroad property


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## sadie (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*

Have you cut up those credit cards - or are the credit cards used for grocery shopping etc at the end of the month?
We are a family on one income of 40k with 2 children, rent is 700 per month so I understand there is very little spare cash there to put towards your debts. You will need to generate some more income. 
Could your wife do some child-minding part time?
Or if you live near some hotels, she could do baby-sitting in the hotels at the weekends.


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## minion (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



IAmAStupid said:


> I receive 250 as rent PM after tax for the abroad property



So a €25k property is giving you €3000 per year after tax.  I would keep that for a start.

Your bank shares are going to be worth more to you in saved interest if you cash in and clear your CC debt.


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## Complainer (19 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



IAmAStupid said:


> I receive 250 as rent PM after tax for the abroad property


For 12 months of the year? Is this under some rental guarantee? If so, how long will this last for?


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## ajapale (19 Feb 2010)

*Re: Huge debt: multiple cc and personal loans,*

I have changed the title somewhat to more fully reflect the discussion.

aj
moderator.


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## Hobbs256 (20 Feb 2010)

*Re: Huge debt: multiple cc and personal loans,*

You need to tackle this head on starting now, do the following

1.  Cut up credit cards
2.  Start a spending diary 
3.  Use some savings to pay the some of the cc debt
4.  Create a household budget and stick to it


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## chlipps (20 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



IAmAStupid said:


> I receive 250 as rent PM after tax for the abroad property


 
Based on this income, I would not sell the property abroad...that will have itself paid for in few more years. If as you say 15K is paid, then in approx 3 years you will own this. 

You need to get spending diary and cut spending as much as possible. No further wild excursions on shares. You will need to try get some extra work if possible to try pay back the credit cards. I think you need to sell the 15k from shares and use this to clear some of the high interest credit cards.

Best of luck and keep us posted on your progress.


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## UFC (20 Feb 2010)

*Re: Huge debt: multiple cc and personal loans,*

If I understand correctly, you actually earn enough money to cover your bills? The problem really is they are weighing you down and depressing you?


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## gordon (20 Feb 2010)

*Re: Huge debt: multiple cc and personal loans,*

Clear your debt with savings and start again is my advice


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## Complainer (20 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



chlipps said:


> Based on this income, I would not sell the property abroad...that will have itself paid for in few more years. If as you say 15K is paid, then in approx 3 years you will own this.


The return on this property sounds a bit too good to be true, which is why I was asking some questions to see what is really going on here.


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## IAmAStupid (22 Feb 2010)

*Re: Huge debt: multiple cc and personal loans,*



UFC said:


> If I understand correctly, you actually earn enough money to cover your bills? The problem really is they are weighing you down and depressing you?


 
that's correct, my all earnings are covering the bills fully for now. But my worry is with this huge debt. I want to clear them down for peace of mind.


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## IAmAStupid (22 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



Complainer said:


> The return on this property sounds a bit too good to be true, which is why I was asking some questions to see what is really going on here.


 
I brought a property abroad before the boom time with this 15k, may be now the value is more than double. I am receiving rentals about 250 e per month on that property.


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## IAmAStupid (22 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



chlipps said:


> Based on this income, I would not sell the property abroad...that will have itself paid for in few more years. If as you say 15K is paid, then in approx 3 years you will own this.
> 
> You need to get spending diary and cut spending as much as possible. No further wild excursions on shares. You will need to try get some extra work if possible to try pay back the credit cards. I think you need to sell the 15k from shares and use this to clear some of the high interest credit cards.
> 
> Best of luck and keep us posted on your progress.


 
thanks chlipps.

yes, I am seriously thinking about to get some extra work in the weekends. at present all my bills are paid with my earnings, but I am so worried when I look at this huge debt.


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## Complainer (22 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



IAmAStupid said:


> I brought a property abroad before the boom time with this 15k, may be now the value is more than double. I am receiving rentals about 250 e per month on that property.


Delighted to hear it is going well. Are you confident that this will continue into the future? How long is your lease with your current tenant? Is there any rental guarantee scheme in place?


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## IAmAStupid (23 Feb 2010)

*Re: I am so stupid to end up with this huge debt*

The rental lease is for 1 year (recently extended), and I am confident that the rent will be the same for future as well.


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## Mongola (24 Feb 2010)

I agree with what has been said: either yourself or your partner NEED to get a part time job, either in the evenings or at the week end, I think this is crucial. 
Also use some of those 15000 to clear some of your credit cards: it does not make sense to save when you have debts.


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## chlipps (25 Feb 2010)

*Re: I am so stupid to end up with this huge debt*



IAmAStupid said:


> thanks chlipps.
> 
> yes, I am seriously thinking about to get some extra work in the weekends. at present all my bills are paid with my earnings, but I am so worried when I look at this huge debt.


 
It could be worse... there are many out there that have huge debts and their earnings are not covering them. You got yourself into the mess and I think that you can get yourself out of it, by being careful and challenge every penny you spend. As I have said earlier, best that you knuckle down with a spending diary and cut your spending to the minimum. Challenge every spend..no luxury items.. packed lunch instead of buying lunch, lidl/aldi vs the convenience stores, more work if possible etc.. 

Best of Luck


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## IAmAStupid (10 Mar 2010)

thanks for your advice chlipps, I am already doing this packed lunch, aldi/lidl etc...
I need to save and earn money to clear the debts i.e. part time job is imporant.

thank you all for advices, much appriciated..


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## dmos87 (18 Mar 2010)

Could your wife take on another child to mind from home? That way there is extra income but only one more child to look after and she can stay at home with her own also. A child around the same ages of your own is always preferable if they are 4/5/6 years old as they will play together. It would be great if the kids were in the same school too to avoid 2 school runs.

Talk to her about this - my mother did it and after 3-4 weeks all gel'd together nicely.


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## Pocket (18 Mar 2010)

dmos87 said:


> Could your wife take on another child to mind from home? That way there is extra income but only one more child to look after and she can stay at home with her own also. A child around the same ages of your own is always preferable if they are 4/5/6 years old as they will play together. It would be great if the kids were in the same school too to avoid 2 school runs.
> 
> Talk to her about this - my mother did it and after 3-4 weeks all gel'd together nicely.


 
I would agree with this suggestion. 

Or would your wife consider going back to work (at least part time?). Your youngest most be nearly play school age.


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