# Financial reality check needed?



## FTB1975 (4 Mar 2011)

*Age:* 35
*Spouse’s/Partner's age:* N/A

*Annual gross income from employment or profession:* €60,000
*Annual gross income of spouse:* N/A

*Type of employment:* Private sector on 12 month contract until end 2011

*In general are you:*
*(a) spending more than you earn, or*
*(b) saving?*
Current monthly salary (since Jan 2011) is approx. €1k more than previous, yet seem to be dipping into overdraft a week or so before pay-day since Jan so must be over-doing it somewhere. Don’t smoke, don’t lead an extravagant lifestyle; not out socialising every weekend.

*Rough estimate of value of home: *€220,000
*Amount outstanding on your mortgage:* €226.600
*What interest rate are you paying?* 3.45% SV, due to increase to 4.85% in April

*Other borrowings – car loans/personal loans etc:* No car/personal loans other than 2 credit cards

*Do you pay off your full credit card balance each month?* No
*If not, what is the balance on your credit card?* 
Credit Card 1 (MBNA): €5803.18
Credit Card 2: (BOI VISA): €7132.95

*Savings and investments:* €150/month saved into a BOI Supersaver account, used in emergencies

*Do you have a pension scheme?* Yes, contributing 5% of salary and AVCs of €200

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

*Ages of children:* N/A

*Life insurance:* Yes


*What specific question do you have or what issues are of concern to you?*
Advice needed on whether I need to cut back/save more/reduce balance on credit card and how to go about doing any of the aforementioned 3 options. How do I make the most of my current earnings while on this 12 month contract, manage the 0.6% increase in mortgage rate and an increase to the minimum payment on MBNA credit card also due in April?
I’m working in a fairly stable industry (pharma) but who knows what’ll happen in the next 12 months. Have thought about renting out 2nd room in my apt but don’t think I can go there.....too long sharing with other people!!


----------



## FTB1975 (4 Mar 2011)

*Monthly outgoings

*
*Car insurance: €75.65*
*Airtricity: approx. €100/month*
*UPC: €91.81 (TV , phone and broadband)*
*MBNA: roughly €170 paid off a month, basically just clearing the interest*
*BOI Visa: as above*
*Life assurance (for mortgage): €120.51/month*
*Mgmt fees: €170/month*
*Socialising: €100-150/month*
*Food shopping: €200/month....roughly €50 a week for 1....is this a lot?*


----------



## mf1 (4 Mar 2011)

What is your monthly income?
What is your monthly mortgage payment?

mf


----------



## niceoneted (4 Mar 2011)

Also as MF1 asks what is take home pay and what is mortgage payment?

UPC is dear. You can get better deals than that. Eg I pay €38 for phone and Broadband/€25 for sky. Total €63 saving of 30 straight off. 

Do you have storage heating? I ask as I am assuming the €100 Airtricity is for ESB perhaps its ESB/GAS combined. 

Car insurance seems very high, are you on provisional, have points? claims? Are you shopping around for it. 
Also are you shopping around for life assurance?
Start a spending diary - write down all you spend. 
Also start a spread sheet with all known annual expenses so you know what you need money for as you do not even mention things like petrol, tax, service for car. tv licence. Clothes/holidays and the likes. 
You need to make a dent in the credit cards. Have you been on a balance transfer with the MBNA one?


----------



## FTB1975 (7 Mar 2011)

Hi folks, 

*Net Monthly income*: €3,700
*Mortgage repayment:* €815 and due to increase to €872 in April.

*Household bills:* Yes I have storage heating; only household bills are ESB and UPC. I'm living in an apt so UPC was the only option....not sure if that has now changed and I can opt for Sky; but unless there's a dish on the roof of the block I can't see Sky being an option.

*Car insurance*; I had a claim about 3 years ago....but was going to shop around anyway as it expires in May. 

*Car tax:* driving a 1.2L and generally pay for the 12 months; due in May also

*Petro*l has become a huge expense since the beginning of the year and the change in job.....I'm spending about €40-50 a week....and that's not taking the recent increase to almost €1.50 a litre!!! 

*Clothes/Holidays:* what are they?! Definitley not the shopaholic I was a few years ago! And as for holidays, won't be happening this year I reckon.

I'll start keeping a spend diary as I'm sure I'm not taking everything into account here.


----------



## truthseeker (7 Mar 2011)

When I add up your outgoings I get ~2413 (i did not include the AVC and pension in this as assume you are stating the 3700 as the take home pay after the pension and AVC).

So (I think) there is around 1287 a month unaccounted for in your figures?

What about health insurance, lunches in work, tolls, gym membership, classes, take aways, medications, dvd/game rentals, bins, magazines/newspapers, mobile phone etc - are you doing any of this?


----------



## Rocker (7 Mar 2011)

FTB1975

Although I can't give you specific advice, I can relate my own profile which is very similar to yours. I have also a salary of approx 60,000 and similar accommodation outgoings. Although our cases are not identical on other items I'm saving approx 1,500 per month. Given this I see that you could have plenty of room to pay down credit cards and eventually add to savings.

As a rough calculation: I've added up your stated outgoings (including mortgage) and it comes to approx 2300. Your salary is 3700. So theres a 1400 black hole difference! Start a spending diary as suggested by niceoneted and see where all your money is going.

Good luck in tightening up your finances.


----------



## NorfBank (7 Mar 2011)

Stop saving the €150pm, use it to pay off the highest interest credit card instead.

Shop around on your life insurance.
All you need is basic mortgage protection, this is around 23pm for 226k/35 year. Even if you add serious illness cover it comes to 85pm, you are paying 120pm. This is a saving of 35pm.

From those two alone you could be paying 185pm per month extra off the credit card (250pm if you go for the cheaper insurance)


----------



## FTB1975 (7 Mar 2011)

Thanks for all the replies, I think the key to understanding where my money is going is to keep a spending diary....As per Truthseeker's post I was underestimating my outgoings big-time!!!

This evening I did a quick scan of ATM withdrawals in the past fortnight...amounted to €550 in total and was made of up €20 here, €40 there....it's this activity on my account which is wreaking the most havoc I think.

Anyway thanks again for all the suggestions, folks


----------



## Greta (7 Mar 2011)

FTB1975 said:


> This evening I did a quick scan of ATM withdrawals in the past fortnight...amounted to €550 in total and was made of up €20 here, €40 there....it's this activity on my account which is wreaking the most havoc I think.



Many years ago the same was happening to us... a spending diary (which also includes all withdrawals and lodgements) put an end to it *very* quickly!

It may also help to figure out how much cash you need for the week and only withdraw that amount once a week, no more 20 here, €40 there etc. And of course, using cash rather than cards.


----------



## truthseeker (8 Mar 2011)

FTB1975 - spending diary - its the only way.

You'll probably find that youre dropping 20/30 quid in the shops when you just go to buy ketchup and realise you also need butter, pepper, an apple etc.... I remember finding myself in a similar position when I first lived alone, I could have sworn I was spending 50 euro a week on food, but when I added in the numbers from the quick trips to spar for bread, onions etc I was spending close to 100 euro a week on food!


----------



## boe (8 Mar 2011)

Can't understand how you have a net salary of €3,700 pm on a salary of €60k when you are making pension contributions of 5% and €200 in AVC's?

I'm on more or less the same salary, pay 2.5% pension, no AVC's and am coming out with just over 3k pm. The only additional item I have is BIK for health insurance which is €75 pm.

This post won't help you but its something I'll be following up myself!


----------



## Bronte (11 Mar 2011)

FTB1975 said:


> This evening I did a quick scan of ATM withdrawals in the past fortnight...amounted to €550 in total and was made of up €20 here, €40 there....it's this activity on my account which is wreaking the most havoc I think.


 
Make yourself a pay day, take out an amount that you will need (and can afford based on your salary) each week on say a Friday and do not make any other withdrawals.


----------



## dec1892 (11 Mar 2011)

I was wondering exactly the same thing boe - I'm on a salary of €63,000 with no AVC or pension contribution and come out with a net monthly salary of €3,400 (€300 less than FTB who earns €60k!!)


----------

