BritPilot flying to debtfree heaven

tyllwyd

hypno06 wrote: »

Perhaps not as shocking really - if there are debts of £120k against an income of £130k, then that is a debt to salary ratio of 92%.

I bet there are loads of us on here with debt to salary ratios that are as much if not greater than that.

If someone has a salary of £15k with a debt of £13800, they are in the same situation, to a certain extent.

I take your point - but equally, whether you are on a salary of £15K with a debt of £13K or salary of £150K with a debt of £130K, either way it is not a good situation, and on the higher salary you have an opportunity to live within your means - and save for the future - without depriving yourself day to day. On £15K you have much fewer choices.

hypno06

yes, tyllwyd, but this is not debt that has accrued through everyday living beyond your means - we all know how much house renovation etc costs and for the majority of people it would not be done via saving up out of surplus income and paying cash, but would be done by borrowing one way or another.

Indeed, that is how my own debt came about - living beyond my means never really came into it, but when your house almost literally falls down around you, big chunks of money have to be found! I had no debt - moved into a house that the structural survey said was sound, and three weeks later began finding the catalogue of problems that resulted in us having to rebuild. Having newly purchased the house with a 95% mortgage, there was nothing left to do the work that needed doing before the council condemned it because they deemed it unfit for the children to live in. So we borrowed......and borrowed.......and borrowed, and ended up with over £100k on credit cards and loans on top of the mortgage. 8 years later, and the debt is becoming manageable, but until a couple of years ago it was running at 200% on of our joint salaries, with the mortgage on top.

I am not saying that britpilot, along with any of us, is faultless with regard to the level of debt, but it is not always as straightforward as having few choices because of income levels.

tyllwyd

hypno06 wrote: »

yes, tyllwyd, but this is not debt that has accrued through everyday living beyond your means - we all know how much house renovation etc costs and for the majority of people it would not be done via saving up out of surplus income and paying cash, but would be done by borrowing one way or another.

But even looked at in that way it isn't a good deal - BP has a mortgage of £250K, and he's estimated its value at £350K so if £120K got spent on the house he is in negative equity by £20K.

I appreciate your argument that having more coming means having more go out - but I still don't accept that if you have income of £130K you couldn't live comfortably on £70K of that money if you wanted to, and use the rest towards your house renovations etc etc. And if you earned at that level for two or three years, you should be well set up. The same just doesn't apply if your income is only £15K. (Sorry BP, that sounds as if I'm criticising you directly, which I'm not intending to do, I just can't resist debating my point!)

BritPilot

From my point of view it really boils down to the fact that I had anticipated that I would be able to earn my way out of trouble and, with an inheritance coming some time in the next 10 years that would pay most of it off I wasnt worried.

I believed Mr Brown when he said he had stopped the boom and bust cycle and inflation would remain very low and interest rates would not rise and pigs would fly!

How stupid could I have been to be taken in by him?

webitha

i woldnt count on the inheritence if i were you, not only is is a privilege and not a right, it also makes you sounds like a vulture, which im sure your not at all.
never forget the person who your expecting it from, might go slightly doolally and leave it all to the cats home or something, believe me ive seen it happen.

also i dont mean to sound rude but quite a few people have asked about the wife getting a job, something you have yet to answer, can she????
i also like good food, but sorry you cannot afford it, you can eat good healthy tasty food on much much much less, i feed 2 adults and 3 kids on £250 a month and that is meat every day, with plenty of fresh fuit and veg, inc toiletries and lots of treats so it can be done

tyllwyd

BritPilot wrote: »

From my point of view it really boils down to the fact that I had anticipated that I would be able to earn my way out of trouble and, with an inheritance coming some time in the next 10 years that would pay most of it off I wasnt worried.

I believed Mr Brown when he said he had stopped the boom and bust cycle and inflation would remain very low and interest rates would not rise and pigs would fly!

How stupid could I have been to be taken in by him?

I do have sympathy for what you are saying - we bought a house that was slightly more than we could really afford and spent £60K last year extending it. We really need another £5-£10K to finish it (we've got half the house with bare plaster and no carpet) but all the money that we had spare in our budget when we started planning has now been taken up by extra food/fuel etc etc costs. If we had known then what we know now, I don't think we would have taken it on.

BritPilot

webitha wrote: »

i woldnt count on the inheritence if i were you, not only is is a privilege and not a right, it also makes you sounds like a vulture, which im sure your not at all.
never forget the person who your expecting it from, might go slightly doolally and leave it all to the cats home or something, believe me ive seen it happen.

also i dont mean to sound rude but quite a few people have asked about the wife getting a job, something you have yet to answer, can she????
i also like good food, but sorry you cannot afford it, you can eat good healthy tasty food on much much much less, i feed 2 adults and 3 kids on £250 a month and that is meat every day, with plenty of fresh fuit and veg, inc toiletries and lots of treats so it can be done

Fortunately, it is not now possible to change the will and, whilst I may sound like a vulture it is only a matter of time and it is always possible that I will die before they do (hence the life insurance policy).

My wife could get a job but, since every penny would be taxed at at least 20% and possibly 40% if I earn more I cant see the point.

In addition, her role is not simply a housewife, she looks after her parents who live 30 miles away and often runs errands for some of my clients who are older and infirm. At this very moment she is collecting someones post and doing some shopping for one of my clients and on monday took two of them to hospital.

Having said that, I will be investigating every purchase from now on to see how much we pay for food and other consumables. I have learned from the forum that nothing can be taken for granted and it is important to acquire as much information as possible in order to make an informed decision as to where cuts can be made.

webitha

please dont think that i was having a go, i wasnt , we, on this board are all in the same position at varying degrees,

have a look at the old style board, they are very very clever people there and will be able to help with the food/toiletries/cleaning products there, i have saved a fortune scine lurking on there :j

also have look at the up your income board, i know its only pennies, but every little helps, also have a nosey at some of the challenges on here, stick around, and although i wont post often here i will follow your thread

RAS

Britpilot

How goes?