Debts Where To Start?

J

Jim8766

Guest
Hi Everyone,

I know I am in a mess I know I have to do something about it. My question where do you start. I have read other threads and it seems start with the highest interest etc. Basically I want to be debt free within 3 years or there abouts. (well at least to be seeing the light at the end of the tunnell by this time). So here is my stroy

CARD CARD 1 6K MIN PAYMENT 180
CRED CARD 2 3K MIN PAMENT 60
BOI LOAN 13K 76 EURO P/W
GE MONEY LOAN 13K 283 P/M
CAR LOAN 14K 307 P/M

So what to I start clearing down every month first, I am trying to keep them all happy by making payments (no missed payments etc) but i want to be cleared of debts (nightmare).

I earn around 2700 take home per month household bills inc mortgage costs 200 p/w and petrol costs 50 p/w

So where to I start and is it possible to be debt free within 3 years.
 
Put all the debt into one loan. Get RID OF THE CREDIT CARD!!!! Find the best rate loan. Credit cards have the higest rate so that would make sense?
 
As has been suggested on many other AAM threads, you need to examine why you have these debts? What are you overspending on?? Create a spreadsheet and list all your daily/weekly/monthly expenditures. Then see which ones can be cut out.

For example, sell the car and use the money to pay your debts (probably credit card), then get public transport. Desparate times call for desparate measures.

Some other suggestions:
- Enquire about a mortgage 'payment holiday' for 3 months, then use the spare cash to service your debt
- Extend your mortgage term to create extra cash each month and use the cash to pay debt.
- Forget socialising, watch TV at home


What do you spend the rest of your monthly income on?
 
Thank you for your replies.. The credit cards have been cut up and I am working on the clearing them. I dont think I could get a loan to cover all the debts and then just have one payment which would make sense. I will check it out however. As for selling the car I cant I drive approx 350 miles a week to and from work I dont have a bus service / train service. I have a good job which I like and would not give up so I really need the car. As for the extra income well it doesnt feel like there is extra income but that is what i plan on using to clear the debts down.
 
Jim8766 said:
Thank you for your replies.. The credit cards have been cut up and I am working on the clearing them. I dont think I could get a loan to cover all the debts and then just have one payment which would make sense. I will check it out however. As for selling the car I cant I drive approx 350 miles a week to and from work I dont have a bus service / train service. I have a good job which I like and would not give up so I really need the car. As for the extra income well it doesnt feel like there is extra income but that is what i plan on using to clear the debts down.
Click to expand...

I drive 320 miles a week to/from work. Had a 03 Golf TDi that I loved, now drive a 93 Toyota Starlet 1.3l. It cost me 2 car-loan repayments to buy it, and I've done 20k miles since I got it a year ago. Serviced it myself twice (with a little guidance!) for about €80 a pop, saving at least €400 on VW services. Halved my insurance and road tax bills too.

It's not that I had to get rid of it, I chose to do so to free up money for other uses. But the point is that I don't regret losing the more expensive car a bit. I cringed at the thought of it first (I look a tad ridiculous in my little car given I'm 6'2"!) but at this stage I honestly couldn't give a sh*t when people look at me funny... you just get used to it and shrug it off.
 
conor_mc said:
I drive 320 miles a week to/from work. Had a 03 Golf TDi that I loved, now drive a 93 Toyota Starlet 1.3l. It cost me 2 car-loan repayments to buy it, and I've done 20k miles since I got it a year ago. Serviced it myself twice (with a little guidance!) for about €80 a pop, saving at least €400 on VW services. Halved my insurance and road tax bills too.
Click to expand...
I service my own car a basic service consists of an oil change and oil filter, the filter costs approx €5 and oil costs €12 for a five litre drum. €40 to service your car, looks like that little guidance is costing you.
 
Johnny1 said:
I service my own car a basic service consists of an oil change and oil filter, the filter costs approx €5 and oil costs €12 for a five litre drum. €40 to service your car, looks like that little guidance is costing you.
Click to expand...

I was including air filter, wiper blades and spark plugs.

You can always skip on the blades, maybe clean out the air filter and replace it every second service instead, get long-life plugs, etc. But to compare like with like (i.e. DIY service versus main dealer service), I included the lot in the €80 cost.
 
Back to original poster request for info....
Firstly I'd agree with posters that maybe you need to look at downsizing your car, current market you could get a decent car, 5-10 years old for a good price (all the ssia new cars are driving down the prices), downsize the engine and its also a running cost saving.
Next thing to do is find out where your money is going, you haven't mentioned it,so I'll make an assumption that you haven't yet looked at your monthly spending, on an item by item basis. Get a notepad and write down every cent that leaves your pocket.... Coffee, newspapers, lunch, bar of chocolate when filling the car, they all add up, to a lot more than you would believe. Review your past 3 credit card statement, were those purchases 'needs' or 'wants', groceries for the week is a need, the couple of bottles of wine are a want!
Start to look at where you can cut costs, and where you can find additional funds: any possibility that you can rent out a room/ work a weekend job / .
Look at your interest rates, you're paying the minimum amount on the ones I suspect have the highest rates. Are you paying the monthly min on each loan, or are you overpaying any of them? If you're overpaying and their rates are less than your credit cards, move your overpayment.
List our your debts with the interest rates, and min amount that need to be paid, and over-pay the one that costs you the most as much as you can afford (those lunches, coffees, chocs can easily give you another Eu75-100 a month).

Mabs.ie have some excellent information under their managing your money section, check it out, it may be useful.

Good luck to you
 
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Suggest you contact credit companies direct or through mabs and explain your difficulty. A friend of mine with a bill she couldn't repay spoke with a very understanding customer service rep who cancelled the mounting interest and explained that the company would rather she payed back the outstanding debt as it stood, in consistent monthly payments that she could afford, rather than have a bad debt on their books. What was more interesting was that when she offered to pay more than the arranged 60 euros a month occasionally, she was advised by the rep not to offer that up as the company may renege on the arrangement.
 
The best way to clear debts is to be determined and not give in to the temptation to overspend. I was in a financial mess a couple of years back but I am now doing really well. If you want to do, you will be able to do it. Just stay positive and focused :)
 
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