Feeling unsettled about our debts
Comments
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I think you've got too many zeros on your house value and consequently on your net assets ...
Unless your house really is worth £2.8m ...174 BPM >> CC Balance (0%) -£3,565.99 - Target DFD Dec 2017 >> Loan (Car) (3.1%) -£19,803.74 - Target DFD Nov 20200 -
Money_Rollercoaster wrote: »I think you've got too many zeros on your house value and consequently on your net assets ...
Unless your house really is worth £2.8m ...
Sorry...it's 280K0 -
ReadingTim wrote: »Ultimately it's up to you to make a judgement call on how likely it is that that will happen; and if it does, how long it might take to find another. Lots of things could happen - it doesn't mean that they will happen. You could be hit by a bus tomorrow - doesn't mean you will.
I think that it is very unlikely that either of us would lose our jobs but you never know!
My husband has a much more relaxed attitude towards it than me. He thinks that we are not adding to the debts, it's reducing each month and life is fine, therefore nothing to worry about. Perhaps I need to be more like him
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I can see your husband's point of view, but I have more sympathy for yours.
As well as scrutinising your budget and trimming costs you need to bear in mind that you are probably in a position where your ability to move debt around (to better offers) is limited. So, with that in mind, you definitely need to keep an eye on how you allocate your debt repayments.
Take for example your Halifax CC ... at £200 a month, you're only going to have cleared 2/3 of the £12k debt before the offer expires, so you'll have to find a new home for the remaining £4k or accept higher interest rates on that debt when month 42 comes around ...
The Barclaycard is on 6.9% for life (presumably). Again, you could really do with finding a new home for that too, but £18k would be a big balance to move ...
The Creation CC ... the best 0% deal they advertise is 12 months and their standard APR is 18.9%. At £55, you're stroking the debt, not beating it into submission. If you can't move that debt and it gets stuck at standard APR, it'll probably cost you £40 in interest, monthly ...
The mortgage is another factor, if you're on a deal, what happens when that expires? How does your credit history look? Will you be limited to the SVR or a renewal with your existing lender? Given that you borrowed to pay for house renovations, you probably would have been better remortgaging to include additional borrowing for that and then overpaying on the mortgage to reduce the debt. Your mortgage company, at renewal, might even suggest the same ...
Anyway, having prepared your SOA, your next step might be to look at the snowballing method to prioritise your debt repayments ...
http://www.stoozing.com/calculator/snowball-calculator.php
Good on you though, you've had a moment of clarity, which is a good thing. I think you need to absolutely maximise this opportunity to look at everything, how you live, what you spend and how you pay to give you the best chance of squaring your finances up for good.174 BPM >> CC Balance (0%) -£3,565.99 - Target DFD Dec 2017 >> Loan (Car) (3.1%) -£19,803.74 - Target DFD Nov 20200 -
mandyappleorange wrote: »I think that it is very unlikely that either of us would lose our jobs but you never know!
My husband has a much more relaxed attitude towards it than me. He thinks that we are not adding to the debts, it's reducing each month and life is fine, therefore nothing to worry about. Perhaps I need to be more like him
No, you never know for certain. But based on your experience of the past and expectations for the future, you can form a judgement upon which it' reasonable to base spending and borrowing decisions.
You think it's unlikely you'll lose your jobs. Your debt is decreasing. It is therefore unlikely that your debt will stop decreasing, so what's the point worry about it?
If you'd like something to worry about, may I suggest Brexit, Donald Trump, global warning, alien abduction, Vladimir Putin, or the removal of Daily Milk chocolate in Creme Eggs? The liklihood of something bad happening in respect of any of these is more likely than you are to get into difficulties....0 -
Thanks RT!
I know that I overthinking it! I just want to see these balances dropping0 -
Hi there :hello:
I didn't want to read and run, but just to say your income and budget looks good so there's no reason why you can't have a good go at paying off this debt quickly.
In contrast to this opinion...ReadingTim wrote: »
You think it's unlikely you'll lose your jobs. Your debt is decreasing. It is therefore unlikely that your debt will stop decreasing, so what's the point worry about it?
I think your debt definitely is worth worrying about. If there is no sense of urgency with your OH then you need to instill some. The reason you are feeling unsettled is because this situation is precarious, one of you might lose your job, you might get pregnant again, whatever, life happens and you have absolutely no back up plan. It is not unlikely that your debt can go up, you must have been really very good at making debt go up to reach £85k unsecured, this forms habits and behaviour patterns that are hard to change. They do need to change though and as yet you haven't shown that the changes are sustainable.
I think you can do it but it's hard. Just some thoughts. Best of luck.
If you know you have enough, you're rich.0 -
I've always had the view that the source of your debt really matters. It sounds like yours comes from investing in a property, which presumably will be reflecting in its value? If so this is very, very different to generating £85k in debt by simply overspending.
Others will have a different view and of course you should do disciplined in making sure you reduce it as fast as realistically possible in case something bad happens, but if I was in your situation I certainly wouldn't panic.0 -
2.5 mil net assets looks pretty good!
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I wouldn't consider selling your house to tackle this, with your income level you can deal with this as others have suggested above. If the worst comes to the worst with regards to your concerns about job security then cross that bridge when you come to it.No.79 save £12k in 2020. Total end May £11610
Annual target £240000
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