High credit card debt - Any suggestions on how to reduce

Age: 35
Spouse’s/Partner's age: 32

Annual gross income from employment or profession: 46500
Annual gross income of spouse:24000

Type of employment: Paye

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

About breaking even to spending more

Rough estimate of value of home: 200,000
Amount outstanding on your mortgage: 195,000
What interest rate are you paying? 2.3%
Mortgage is 880 per month

Other borrowings – car loans/personal loans etc
Car loan 10k remaining- 504 p/m Car worth 11k 22 months remaining on HP
Car loan 5k remaining- 264p/m Car worth 4500 22 month remaining on HP
Need both for work- No public transport in my area. Both at approx: 7%

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

Between wife and myself we have 17k @ 11% on one card and 2k on another @14%

Pay approx: 500 p/m off the C.C – Not using it anymore except for emergency

Savings and investments: None

Do you have a pension scheme? Yes- Current fund 26,000- paying minimum allowed.

Do you own any investment or other property? Yes, Outstanding mortgage 84,000, Value if it could be sold, 90,000
Mortgage 433 per month, Rent coming in 500 per month
Management fee 900 per year which is 75 pm
Interest 2.3%

About breaking even on the flat but am in for the long haul with the aim of it being a pension contribution when older

House /flat expense per month- 100 euro



Both non smokers-
Christmas/crsitening gifts, weddings/Social/entertainment/takeaway/cinema/restaurant/holidays – Average 600 p/m
Clothes - Average over a year- 50 p/m

Gas/elec approx: 50 euro each per month so 100 euro

Petrol/diesel for both cars 260 p/m

Car tax for both cars 84 p/m
Sky 30 euro p/m

Food /toiletries approx: 400p/m

House Insurance 50 pm

Mobile Phones and mobile broadband internet 80 pm (30 each on mobile phones and 20 mobile broadband)
TV License 13 per month

We shop in aldi and have basic enough tv package and make our own lunches to bring to work.

Question:
Our income just about covers our expenses.


Would you recommend re-financing the cars to extend term and put saving towards paying down credit cards.
Ideally we wouldn’t need 2 cars but we do.

Are people on AAM consolidating loans ?

I don’t want to completely turn into a hermit so would like to have some social/entertainment/annual holiday during the year am I foolish not to cut these out completley.

We will be looking to start a family soon but am reluctant to bring a child into a home with so much debt.

Advice and Opinions good or bad welcome- Even the ones that say I ‘m an idiot for having so much credit card debtJ


I've averaged out the expenditure over 12 months, some months we would spend more and less in others.

I haven't checked yet but does anybody know if a bank would allow a c.c 0% transfer on a 17k cc debt?

Some quick thoughts
What kind of cars do you have that require €1000 pa in car tax (84 pm)? Is downsizing the cars an option

have you reviewed your tax and are you being as efficient as you could be.? eg are you claiming for medical expenses.

Your spending €7200 pa on entertainment/nights out/holidays. Given the level of personal debt you have, that is beyond your means. Don't stop it completely, you need an outlet of some sort, but you need to cut it back.

All of your expenses seem quite reasonable except for the

Christmas/crsitening gifts, weddings/Social/entertainment/takeaway/cinema/restaurant/holidays – Average 600 p/m

Click to expand...

You really cannot afford this ! You are overspending and your bubble will burst soon.

How are you going to support your expenditure over the next 3-5 years when the banks increase our mortgages by say another 100-200 euro ?

Your paying around 170 euro a month in interest on that 17k credit card. 170 a month is money that you are effectivley throwing away.

You should consider reducing your 600 p/m spend - even to at least 430 so that the remaining 170 can support the interest on the card.

I see your still using your credit card. You should really cut it up. If you need anything then it should be taking out of the 600 p/m that you give yourself. You will never get it down if you have it lying around. I would even suggest contacting the bank and asking them to keep reducing the limit on the credit card to support the outstanding balance, that way you can no longer use it. I would also suggest that you incorporate the 100 a month for the house expenses into the 600 p/m spend.

17k is an awful lot to ask a bank for a 0% credit transfer. This would save you just under 1k ....You would really need to shop around.

You already know yourself that you have overspent. This debt has the potential of getting worse with
Gas going up
Petrol going up
Food going up
Mortgages going up

or it could be reduced by spending less than what you earn on luxury items and putting it towards the debt that you accumulated in the good times.


If you bring a child into the equation, besides the average cost for food and nappies etc - can you also support the 600 / 700 per month creche fee's or can you afford for your wife to give up work ?

Best of luck in reducing your debt. It will no doubt take awhile to clear it all !