# we are in major trouble and have ended up with this amount of debt.



## bubbley (18 Feb 2010)

Age: 25
Spouse’s/Partner's age: 25

Annual gross income from employment or profession: 30,000
Annual gross income of spouse:18,000 (+ commission, €20-€50 a week)

Type of employment: Civil Servant

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

Rough estimate of value of home: renting, 600 per month
Amount outstanding on your mortgage: 
What interest rate are you paying? 

Other borrowings – car loans/personal loans etc 
1 loan each- mine 10k (€85/wk), his 5k (€200/month)

Do you pay off your full credit card balance each month? no
If not, what is the balance on your credit card? mine 2k, him €6k

Savings and investments:

Do you have a pension scheme? no

Do you own any investment or other property? no

Ages of children: none

Life insurance: no


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

we are in major trouble, partner lost his job, has since found one but is spending €80 a week on fuel and took massive pay cut. living on nothing at the moment. both smokers but have cut that to 60 a week between us (would be none smokers only its the only thing that helps with stress). savings drained while OH out of work. 

spending €35 a week on food (for the 2 of us), petrol for me €40, OH €80. OH has 2 credit cards, one €10 a week, owes 1,500ish, the other approx 90 a month. my credit card €45 a month. dont go anywhere, getting to the stage where we cant go visit family because we cant afford €20 petrol. cant believe we were that stupid to get ourselves in so much debt. And we got our ESB bill, its overdue and we owe €400


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## dereko1969 (18 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*

Do you have anything you could sell from the debt you built up? If yes, sell it.
Do you have public transport or cycling options from where you live? 
Do you need 2 cars? 
Could you sell either car and buy a much cheaper one and use the difference to pay off some of the debts?
Can you move credit cards to 0% accounts?
Ask your landlord for a reduction in your rent.


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## bubbley (18 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*



dereko1969 said:


> Do you have anything you could sell from the debt you built up? If yes, sell it.
> Do you have public transport or cycling options from where you live?
> Do you need 2 cars?
> Could you sell either car and buy a much cheaper one and use the difference to pay off some of the debts?
> ...



my loan is a college loan and car loan, car only worth 3k now, waiting for NCT to sell it, cannot get public transport as we live in a rural area and there is no public transport links in the area. we are trying to move to the town where i work so we can get rid of one car but we cant afford to pay off ESB and get money together to move! 

i doubt either of us would get a creditcard as our credit rating is destroyed from late payments on credit card. i'll look into it though. 

our landlady will not give us a reduction on our rent, which is another reason we are moving, we have 2 months left on our lease and told her we would move unless she would reduce it but she is unemployed at the moment and i guess she cant afford the mortgage herself


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## Complainer (18 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*



bubbley said:


> our landlady will not give us a reduction on our rent, which is another reason we are moving, we have 2 months left on our lease and told her we would move unless she would reduce it but she is unemployed at the moment and i guess she cant afford the mortgage herself


Ask her if she can afford to have it vacant for a few months looking for a new tenant?


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## bubbley (18 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*

tried that tactic as there are a lot of houses in the area for rent at similar or even slightly lower rents but she told us she is not in a position to reduce the rent. i think she reckons we'll stay eitherways!


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## number7 (18 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*

Am I missing something? your net income between the two of you looks adequate to meet your outgoings.

Just took a quick look income about 50k gross between you that probably gives a take home of 35k plus with outgoings of 24k

Am i missing something?


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## bubbley (18 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*

i'll go through it 

monthly takehome for me (civil service so after pension, union etc) 1760
OH takehome (minus commission) 1360

total 3120

outgoings: 
rent                                600
CC 1                               100
CC2                                 50
CC3                                 40
Loan 1                            350
loan 2                             200
Car ins                            130
repayment on overdraft      100
Petrol OH                         360
petrol                              250
Food                               180
broadband + TV                  60
Bins                                  35
ESB                                  50
Car MISC (tax, tyres etc)    100 (i blame poor state of roads)
Cigarettes                         100
Heating                            100
MISC- credit, presents etc   200 
Total                                3005

When my OH gets commission it usually goes towards an outstanding bill, like overdue phone bill (has since gone prepay) or on petrol to go visiting relatives or friends, we dont go out or drink anymore. the car misc might seem high but we both drive to work on bad roads, food bill is low as we are vegetarians! MISC includes clothes also.


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## gianni (18 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*



bubbley said:


> outgoings:
> rent                                600
> CC 1                               100
> CC2                                 50
> ...



Don't worry too much.. you are in a tricky but not impossible situation. You'll get through it - don't despair.
Some suggestions for monthly savings:

1) Move to town and ditch the 2nd car - from your monthly outgoings listed above that would save you approx *365 *(Your petrol + Half insurance + Half Car Misc)

2) Lose the BB & TV. Free internet in your local library and 'free' tv via terrestrial aerial, *60*

3) Don't buy presents for anyone until you're back on your feet. Bake them a nice cake or make a nice card. *50 *(estimate)

4) Wear an extra jumper around the house. Don't turn on the heat as often as you usually do. You've no kids so this should be doable for 2 adults. *50*

5) Quit smoking - hard to do but worth it in the long run. *100*

That's *625 *a month savings. Hopefully by moving into town you can trim a bit off your rent bill. Also your OH's fuel bill is very high - could he downsize to smaller engined car ? I'm sure there are plenty of other lifestyle changes you can make to save some more money. 

The best of luck.


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## chlipps (18 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*

Gianni is spot on... but you need to make harsher cuts to get back on track. Also can you get part-time jobs anywhere to supplement your incomes.


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## Hobbs256 (18 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*

Good post Gianni,  I would not panic as from the calculations that Gianni  did, you can cut your outgoings by over €600.  You are spending too much on petrol.


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## hiagain (19 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*



bubbley said:


> we are trying to move to the town where i work so we can get rid of one car but we cant afford to pay off ESB and get money together to move!
> 
> 
> 
> ...


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## Pocket (19 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*

If your moving I would recommend that you choose somewhere that is well insulated/modern/smaller house as it will reduce your heating and ESB cost (also worth changing to airtricity which is about 13% saving on your bill). Our electricity bill (including all our heating) comes to about 50 euros a month in the winter. We live in a 2 Bed townhouse and the heating is night storage. 

I agree with Gianni - Having only one car to run is a big saving. Definately worth moving! Surely the cost of moving isnt too much as you would have the deposit from your current apartment? Could you ask a parent to bridge the gap between paying one deposit and getting the other back?

Also, have you looked at getting tax back on the rent you have paid? If you havent claimed it, it might be enough to pay off your ESB bill:

http://www.revenue.ie/en/tax/it/credits/rent-credit.html

My final piece of advice is to set yourselves goals to pay your loans off. Every less loan or cc bill is more money to live on. If you try to aim to have one paid off in lets say 8 months time and try to live frugally until then, you'll have a real sense of achievement instead of feeling down about how little you have to live on.


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## minion (19 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*

am i reading this right.
You earn 66% more than your partner but *only* take home 29% more than him.
Wow.  So much for being a civil servant.  Those levys must hurt.
I cant get over that.

That said though, i dont think you are in a bad situation at all.  Its very manageable if you follow the good advice given above.


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## ajapale (19 Feb 2010)

Title changed somewhat to reflect the discussion.

aj
moderator


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## deadlyduck (19 Feb 2010)

> Monthly takehome for me (civil service so after pension, union etc) 1760



This net value seems low for a gross of €2500 per month, even allowing for the public sector levies and superannuation. Apart from paying the various compulsory public sector deductions are you paying for something like VHI, social club or income protection insurance through your payslip? 

You should check if you are getting all your tax credits- the greater the value of these, the lower your monthly tax deduction. From your original post it's not clear if you are single or married- if single, at an absolute minimum you should be getting tax credits of €3660 pa or €305 per month. Additionally, you might be entitled to tax credits for union membership, flat rate expenses apart from the rent credit as noted in an earlier post. 

You might also want to download my spreadsheet to check your pay calculations- http://taxcalc.eu/monthlyss


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## Noor77 (20 Feb 2010)

*Re: we were so stupid to end up with this amount of debt*



minion said:


> am i reading this right.
> You earn 66% more than your partner but *only* take home 29% more than him.
> Wow. So much for being a civil servant. Those levys must hurt.
> I cant get over that.


 
I am a civil servant on €51k gross and take home €2,773 net a month. The levies are very significant - I only realise that when I see other peoples net salaries on this site - the gross might be lower than mine but the net is higher  That said, I have no dependents and came into a sum of money a couple of years back and used it to reduce my mortgage so I only pay €600 a month.


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## FoolishPenny (21 Feb 2010)

Bubbley,
Try not to "shaft" your landlord - don't lose your soul over this debt.
The other posters are about right. The basic math is A - B = C.
A = income (earned, unearned) - try to get extra work, sell some crap you have, see if a raise is possible.
B = Expenses - do your homework, and reduce these like crazy. I don't know if giving up the smokes is possible for you, but you should try. Aim to reduce all and every expense. Track expenses on something like Wesabe (some links etc on my site) or Mint - you might be surprised where your money is leaking out. For paying off debts, there are two ways I'd recommend: (1) Most expensive first (probably one of the credit cards) or (2) "Snowball" - take the smallest first and move on from there. This is financially counter-intuitive, but psychologically very helpful.
C = What you have left over. You don't _have_ to use this to pay debts - think hard about your situation, and maybe moving into town might be more sensible before you pay debts (try to buy some breathing space from ESB).
Overall, you should take a snapshot of your Net Asset Value now, and plan out where this could be in 12, 24 and 36 months. You can use Excel right?

Keep your chin up - it's never as bad as it seems.
Foolish Penny out.


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## Fiskar (21 Feb 2010)

Only one problem with maths savings.

If you move to town the rent will be alot higher and will possibly negate the car savings. However try to move to a place with good public transport links to take advantage of cheaper rent and the reliance on a car.


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## mylittlepony (21 Feb 2010)

To cut cost of petrol, drive under the speed of 60, this save petrol.
Cos any higher/faster speed you are burning petrol faster.
So slow down.
i read in newspaper about cutting down petrol cost.
So you need to leave earlier to get somewhere on time.
Just a tip.


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