'normal' amounts of debt in this day and age

C.M. · 21 March 2017 at 11:51PM

We are myself 34 and OH 41. Currently I earn around 35k with 6k of debt on 0% and a mortgage of 39k on a house valued at around 97-100

.....but 18 months ago I was earning 20k with debt of 12k - mostly accumulated pating for my masters and, and other bits and bobs that were needed for moving house after my partner became disabled, had to stop work and go through numerous surgeries.....cutting our income in half. Then I was made redundant....and this was all at the start of the economic crash - I ended up supporting both of us and my daughter on a series of part time and occasionally full time temp contracts - we had the financial commitments of a family with income of 30k plus, and suddenly I wasn't even earning enough to pay tax.

I feel quite lucky that I was able to secure better employment, and work my way back to something stable, and over the last year work on getting rid of the debts and stop accruing more. Especially as, despite all of the surgeries, my partners physical Capability has never recovered

This time next year we will be debt free and we can start hammering the mortgage.

determined_new_ms · 22 March 2017 at 9:29AM

we are 41 & 36 and earn £10K & £32K we have no debt except our mortage of £130K on a £220K house.

My partner has just bought a car (£3K) and has the money in savings to pay for it but has put it on a 0% interest card to pay off over a year rather than wipe his savings out. We're quite debt adverse after having to struggle to pay off £16k back in 2010

It's hard to know what is "average" we got together in 2008 both in debt and moved in together quite quickly. We then had just over a year when we were kinda paying our ccs but also spending on them. In 2010 we took the extreme route of repayment and paid it all off within 10 months. We then set about saving to achieve having enough in savings that if one of us lost our jobs we could meet our outgoings for a year (at the time I earned considerably more, my partner less)

In 2015 I lost my job and due to personal reasons was off of work for 15 months. I cannot tell you what a relief it was only to need to reign in our spending rather than worrying about how we would meet the cost of debts. This gave me the opportunity to re-evaluate our lives and when I returned to work I took a part time job stepping down massively to no longer work in management and I am applying to do a masters this year with the view of trying to get a funded place for a doctorate in clinical psychology when I have finished it.

In my book any debt really isn't worth it. Everything I want I save and pay for. My master's I have 75% of it ready to pay and will save the last 25% over the next year. I could ask my employer to pay some of it but then will be contracted to work for them for a period after finishing it or pay it back. We've been saving for over a year to have a patio laid and now are getting quotes for the work but in all probability it'll be next year before we can afford it

Yurona · 22 March 2017 at 10:11AM

We are end 30s, 2 children and live in the southeast. About £700 per month on credit card, but that gets paid of monthly (credit card point are higher value than interest in the moment). We do have a super sized mortgage though (280 000 still to pay on house worth 450 000, and it's a tiny terrace!). No other debts though, but the size of the mortgage is scary

StopIt · 22 March 2017 at 10:34AM

Puddylove wrote: »

When I joined MSE I owed £23k plus, courtesy of vet bills, and my financially incontinent ex.

If that was a typo, best typo ever on MSE.

If it wasn't a typo, then it was the best "flushing away money" analogy I have ever seen.

As this thread has shown, there is no "normal" debt level as everyone has a different view of how they manage their finances. However many with a toxic relationship with money and in severe hardship usually have no idea f the impact of debt until it is too late. As always, education is key to this and while it's great that many people use debt responsibly, it would be amazing if more people were given the tools to do so themselves.

System · 22 March 2017 at 10:48AM

I'm 31 and my wife is 26 earning joint income of £60,000 with a £255,000 mortgage on a £350,000 house with a debt of £1,000 on a 0% CC, but we're renovating the house so cash is king at the moment so will pay off the CC once we're finished in a few months

I find it incredibly scary when people are saying £20k,£40k,£60k+ is 'normal' or 'average'. If i was in that level of debt without a £40k car sitting on my drive or a newly built extension on the house then this is not 'normal'! You should be taking a good look at your way of life and really evaluate what you're plans for the future are. Yes you may be earning £70k a year and can manage the repayments.....but what if you got made redundant tomorrow?! with that level of debt you would soon be in the gutter and no one will be able to help you out to that degree. Don't have the mind set this is 'normal' or it's ok because this is what the 'average' persons finance are like or we can sort it out later.....SORT IT NOW ITS SERIOUS!!

We saved hard and lived with inlaws to get our first house after both going to uni and being skint. We made a sensible choice with the first house we bought and sold it at a good profit which meant we had a bigger deposit for the next house and some left over to renovate it.

Live to your means, being in big unsecured debt is not in your means!!

worriedDan · 22 March 2017 at 10:49AM

Yurona wrote: »

We are end 30s, 2 children and live in the southeast. About £700 per month on credit card, but that gets paid of monthly (credit card point are higher value than interest in the moment). We do have a super sized mortgage though (280 000 still to pay on house worth 450 000, and it's a tiny terrace!). No other debts though, but the size of the mortgage is scary

I view mortgage debt differently though. It's acceptable debt, even though it might be a bind on a monthly basis. I don't think about our 75K mortgage debt but I worry constantly about the 50K+ of non mortgage debt that we have. Thankfully having a small mortgage (less than £500 per month) is allowing me to throw 2k a month at the debts, so whilst our situation is not ideal, it is temporary, I totally get how stressful it must be to have my level of debt and little disposable income to service it.

worriedDan · 22 March 2017 at 11:20AM

AlexandLauren wrote: »

I'm 31 and my wife is 26 earning joint income of £60,000 with a £255,000 mortgage on a £350,000 house with a debt of £1,000 on a 0% CC, but we're renovating the house so cash is king at the moment so will pay off the CC once we're finished in a few months

I find it incredibly scary when people are saying £20k,£40k,£60k+ is 'normal' or 'average'. If i was in that level of debt without a £40k car sitting on my drive or a newly built extension on the house then this is not 'normal'! You should be taking a good look at your way of life and really evaluate what you're plans for the future are. Yes you may be earning £70k a year and can manage the repayments.....but what if you got made redundant tomorrow?! with that level of debt you would soon be in the gutter and no one will be able to help you out to that degree. Don't have the mind set this is 'normal' or it's ok because this is what the 'average' persons finance are like or we can sort it out later.....SORT IT NOW ITS SERIOUS!!

We saved hard and lived with inlaws to get our first house after both going to uni and being skint. We made a sensible choice with the first house we bought and sold it at a good profit which meant we had a bigger deposit for the next house and some left over to renovate it.

Live to your means, being in big unsecured debt is not in your means!!

Hi, you are totally right. We are having to work extra hard now to correct our past financial mistakes. I am trying to take the positives though - we have recognized the problem before it is too late and thankfully we are in a position where we can sort this out in a relatively short period of time. I dread to think where would would have ended up if we hadn't opened our eyes to the mess we were getting ourselves into. By the time we are 40 we will be in a totally different position.

Money_Rollercoaster · 22 March 2017 at 11:28AM

I don't really have a problem with finance for houses and cars ... you pay for those items while you use them. The only caveat is that those types of purchases still have to be proportionate to your income and ability to pay.

The problem is more associated with putting off paying for most everything. That's certainly where I got in a pickle and getting square has been a long struggle. It's pretty depressing when you think ... the reason I have no money now is that I squandered it on stuff maybe 5 or 10 years ago ... not even things that I use every day or consciously value as part of my life.

Thank heavens for the LBM ...

System · 22 March 2017 at 11:52AM

@worriedDan

It's good to hear that you've recognised the debt and pushing to sort out the finances :beer:

It's easy for someone not in debt to say 'Dont get in debt!' but everyone is different with different circumstances. I was a sole earner on £25k looking after a now ex partner and her littlen trying to pay the mortgage while she was going to town on my credit card without me knowing.....one of many reasons shes now an ex lol, she left me with £10k debt but i took the situation in hand, moved back in with my parents (back in my home town in their 4 bed house so didn't really bother them) and rented out my house which helped clear the debt and rebuild my shattered confidence. Then i met my new partner a couple of months later and when we were ready to move in together i sold my house and we bought one together

I learned my lesson to keep finances under control and be greatful for what you've got and do my best to plan for the future financially

comeandgo · 22 March 2017 at 12:08PM

I'm another who thinks debt is not normal, other than a mortgage which hopefully the property is going to cover if needs. Many of those in debt would have enough monthly income to pay outright for what they want if they were not repaying so much to loans and credit cards. It seems a vicious circle with the winners being the banks.

'normal' amounts of debt in this day and age

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