We'd like to remind Forumites to please avoid political debate on the Forum. This is to keep it a safe and useful space for MoneySaving discussions. Threads that are - or become - political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
Cannot stop working out my debt.
andys15
Posts: 1,102 Forumite
My debt total is taking an age to come down because I cannot stop thinking about it. Nearly everyday I add it up, work out my monthly debt outgoings, get stressed and then work it out a different way. I use Whatsthecost, all of the time. I am not going to post an SOA as I am down to the bare minimum on everything. I never go overdrawn and I am saving towards a holiday that I have already booked the flights for. I have £46000 unsecured debt and spend £2060 each month servicing it. I just want rid ASAP, but then some days I want more money each month and I am prepared to take longer to pay the debts and incur more interest. I currently pay £120 interest each month on 2 loan repayments, everything else is interest free.
Over the life of the loans it will cost me £1400( 1 loan = 14 months left and the other 48 left). I am seriously considering taking out 1 large loan which will take my debt outgoings each month to £1100, but add over £200 per month in interest.
I know this goes against all I believe in since becoming a DFW, but I am sick of having to watch every penny, and more to the point my wife is sick of me watching her watching every penny. She is fully supportive of my quest to be debt free ASAP, and we are very strict, but I dont know at what cost this is putting on our relationship.
Between us our gross salary is £94000. Part of me wants to pay everything to reduce the debt ASAP, but part of me recognises that we are on a large wage, and being £23000 ish in debt in 14 months such a big deal for the wage we are on (14 Months is always a point I refer to as this is when my fixed rate mortgage deal runs out). Our mortgage is less than 3 times our combined wage. In fact our combined take home pay is £5250 and the mortgage is currently £1284. This thought changes on a daily basis, if not an hourly bases. The nagging thought in my head is that I dont want to look back at my life in 30 years time and regret the years I have lost watching the pennies.
Over the life of the loans it will cost me £1400( 1 loan = 14 months left and the other 48 left). I am seriously considering taking out 1 large loan which will take my debt outgoings each month to £1100, but add over £200 per month in interest.
I know this goes against all I believe in since becoming a DFW, but I am sick of having to watch every penny, and more to the point my wife is sick of me watching her watching every penny. She is fully supportive of my quest to be debt free ASAP, and we are very strict, but I dont know at what cost this is putting on our relationship.
Between us our gross salary is £94000. Part of me wants to pay everything to reduce the debt ASAP, but part of me recognises that we are on a large wage, and being £23000 ish in debt in 14 months such a big deal for the wage we are on (14 Months is always a point I refer to as this is when my fixed rate mortgage deal runs out). Our mortgage is less than 3 times our combined wage. In fact our combined take home pay is £5250 and the mortgage is currently £1284. This thought changes on a daily basis, if not an hourly bases. The nagging thought in my head is that I dont want to look back at my life in 30 years time and regret the years I have lost watching the pennies.
Debt free. March 2020
Mortgage free-August 2021
Planned retirement date- 19/5/2026
£29500 saved. Target £420000(19/05/2026)
Mortgage free-August 2021
Planned retirement date- 19/5/2026
£29500 saved. Target £420000(19/05/2026)
0
Comments
-
Watching every penny is not easy, it is very difficult. Some people on here have cleared 100k debt in 6 years but that has involved incredible discipline to do it. No holidays, lots of work and every penny thrown at snowballing the debt.
What you are suggesting is to increase your debt by lowering repayments, this may increase your quality of life in the short term, but it will keep you in debt for alot lot longer. You may well find doing this is a 1 way street you may regret.
I personally would continue on paying your debts at the repayment to get free asap.
An alternative is to consider bankruptcy if you cannot stand your current position, this way only 50-70% of your surplus cash is taken, this would give you some money for luxaries and holidays, and will last 3 years. Although bankruptcy has obviously more far reaching consequences.Although no trees were harmed during the creation of this post, a large number of electrons were greatly inconvenienced.
There are two ways of constructing a software design: One way is to make it so simple that there are obviously no deficiencies, and the other way is to make it so complicated that there are no obvious deficiencies0 -
Hi Andy
At the begining I just wanted to do things slowly and as long as I wasn't increasing the debt I was happy. However once it started decreasing I became more and more obsessed, I would lie there for hours every night thinking about my budget and when I could make some more payments.
This has eased off now, but the focus has remained. For me I have decided that 3 years of living on a strict budget, compared to being free for the rest of my life is worth it.
I have actually learnt that there is nothing I need on a monthly basis, they are all just wants and my only want now is to pay my debt off.
You can only do what is right for you, but things do get easier as the days tick by and turn into months.
Good luck xLBM Aug 09: £18,650.47 - Current: £12,854.93 (£5946.79)
Barclays: £2,928.34 Lloyds: £2,499.60
MBNA: £3,788.99 Overdraft: £1,900.00 Mum: £1,738.00
Surveys: £6.60/£40.000 -
I appreciate exactly where you are coming from - My thoughts on my debt repayment plan changes on a daily basis - I suppose based on how much I want to do or buy something that is not in my rather tight budget. I am similar in the fact that compared with my salary my debt is small and quite managable (and all on interest free) and I only have a few months of things being so tight - I will be debt free by August as long as there are no unforseen problems - but I often feel like the obsession is affecting my family and ask my self is it actually worth it? my answer ususlly comes back firstly to the fact that I got into debt so can't control my spending on credit therfor I should have no credit! and secondly I will have an extra £1500 a month to play with and have learned how to budget and spend wisely - so will be much better off!
The idea of getting a consolidaition loan would, I imagine, be very tempting as it would reduce your payments all be it taking a longer time to get debt free - but as many, including myself, will tell you - the temptation to take on more CC debt is great and what you actually won't have learned is how to not get into debt again!
I hope this makes sense!0 -
Cheers guy I know what you are saying beacuse I tell myself it all the time. Its the quality of life that I worry about. Going back to my 14 months. In 14 monthwith the I would get, my debt outgoig would then drop from £1100 to £462 and I would be £23000 in debt wth 3years 8 months. £462 a month on our was is not much. Where as over £2060 right now is, although I would be debt free in less than 2 years. 2 years for me is a walk in the park. 2 years of the children lifes will never be got back. Dont get me wrong though I know we dont need to spend money to keep the kids amused. I did an experiment the other day which thankfully worked in my favour. My wife said the kids will suffer because we dont have much disposable income, so I asked the kids what they wanted to the do the next day, Ten pin Bowling, Cinema, Meal, or a bike ride with pack lunch and they choose the latter.Debt free. March 2020
Mortgage free-August 2021
Planned retirement date- 19/5/2026
£29500 saved. Target £420000(19/05/2026)0 -
The idea of getting a consolidaition loan would, I imagine, be very tempting as it would reduce your payments all be it taking a longer time to get debt free - but as many, including myself, will tell you - the temptation to take on more CC debt is great and what you actually won't have learned is how to not get into debt again!
I hope this makes sense!
We wont get into debt ever again( i know probably heard a thousand times). Once I can free up the £2060 we are getting a 10 year fixed rate mortgage which will cost me an extra £900 and we will be mortgage free in 10 years, currently 28years. We never use credit cards except for Balance transfer. The biggest problem again, well its not a bad problem is that I have about 8 years before I reach the top pay for my job. So I get a payrise as well as an inflation payrise every year. My top of scale is about £92000(right now), and my wifes who works for the same company, top of scale is about £38000. We are in our early to mid 30s, and have fantastic pensions set up. Its fair to say all things being equal we will be very comfatable in about 8 years time, and close to being mortgage free. I just think why dont I let comfatable me in a few years take some of the weight of skint me now. Yes it will cost more in interest but in the grand scheme of things, is it so terrible. I am battleing with my own conscience here.Debt free. March 2020
Mortgage free-August 2021
Planned retirement date- 19/5/2026
£29500 saved. Target £420000(19/05/2026)0 -
Andy
I think that your going through a natural part of the process! I was obsessed doing the exact same for a while! I think I was hoping the numbers might change faster . They never did! Until I settled into focused debt-busting!
It is tough when you see others doing things you'd love to do! And in a way, I'm lucky as I don't have kids or an OH to compound the guilt I already feel being in this situation! But sometimes you need to remeber it takes others longer to get to where you are in your thinking!
I don't know what age your kids are, but if they are younger, it's so much easier to do the free things (my friend and I are constantly in the park with her kids - and they've said it's their favourite thing to do). Once they become teenagers things might get more expensive, so if you've got the debt down by then, it'll be easier to manage.
I was sucked in with a consolidation loan - see RBS in my sig! If I hadn't have taken it, the original professional studies loan would have been paid off by now! Though the amount I owe my parents might have been slightly higher. But in retrospect, they would have preferred that and it would have been an easier journey for me! But hindsight is a wonderful thing; what's done is done!
Now I budget in at least one fun (and perhaps costly) thing per month and I pay way more than is MSE for haircuts - but these things keeps me from obsessing, feeling down and they keep me on the straight and narrow, so I find they are needed to balance out the bigger picture. Perhaps it would help if you and you OH sat down to work out what the most important "treats" are for your family and you can factor them in?
Good luckJan10: 28,315.81 Jan11: 18,015.32 Jan12: 7,682.58 Jan13: 2,987.73 Current debt: 1,225.55
HFC [STRIKE]1896.10. [/STRIKE] 225.55 SLC2 [STRIKE]5123.34[/STRIKE] 0 Others [STRIKE]2085[/STRIKE] 1000 Bcard [STRIKE]1172.60[/STRIKE] 0
Mike's Mob0 -
Its not really treats I am trying to afford. Thanks to this site, I am great at budgeting. We have actually got 9 bank accounts, well I have, my wife thinks I am obsessive. So my teenager goes skiing next year so I have a skiing account and put £90 in everymonth. Same with car tax etc etc. Anything that isn't a fixed amount each month has a bank account. Anyway its just the everyday living. Take this month for example, We got paid on 26th and we had £740 left for the month. £500 as cash and £240 left in the shopping account. As of today we have spent £472. Thats not going crazy, thas just everyday things. So we have £268 left. We have food for about 8 days. So probably need 2 shops (we got months supply of toiletries, washing powder etc etc on our first shop, we now need just food). I have a spending diary and of that £472, every bit was pretty much needed. We will not spend more than £268 this month, but this is so annoying. We will be on noodles and beans come the 22nd. Is it wrong to pinch a little from rich me in just 2 years time really(£740 left over each month now would become £3350)Debt free. March 2020
Mortgage free-August 2021
Planned retirement date- 19/5/2026
£29500 saved. Target £420000(19/05/2026)0 -
We have had a similar dilemma. We have 2 kids and 2 houses 1 rented and 1 which we let out. We were going to save up for another deposit and buy another house-in 20 years we would be mortgage free with 2 houses, 1 giving us an income for our retirement......however we have 2 young kids and can't afford a holiday....they would be left a house each in our will....which i'm sure they'd be very grateful for but we thought ...bu**er that for a game we want to enjoy our kids whilst we can and travel a bit and have a nice car etc etc---life is too short and they grow up incredibly fast....sounds like a cliche but it is soooo true.
So holiday let house is on the market, when it sells we will be minted:D and have worked out we will have so much disposable income we can save up a lovely big retirement pot anyway:T
You're a long time dead!:A0 -
I am in a similar position although even more, I would swap your ability to be on 0% rather than the 34% MBNA, all overpaid each month on 8 cards and one loan.
Until 2 years ago I never had a penny on cards always paid in full and had a very large amount of available credit To cut a long story short, builders went under on me whilst house building and after all the hard work put in and RBS sinking fast so refusing further support I did it myself. Maxed out all cards and left no room for manouvre once 0% deals had run out.
I was due to remortgage a year ago to consolidate all the funds where they should be, in a mortgage. LTVs fell through the floor the lenders turned down the mortgage so I plugged away at the cards, every day working out the snowball calculator 2 am 4am 6am all day. I have been fighting and still 12 months later I am trying to consolidate and remortgage, until last week when the surveyor valued the property at £10k lower than exactly 12 months ago again killing the mortgage!!!
If I put all my debt on to my mortgage it would cost around £80 per month in interest NOT the nearly £2000 per month.
I have already put a case on here stating that consolidating is the way forward for those people like us who service our debts, I could afford to seriously over pay which would be more beneficial than paying over £15k a year in credit card interest some of which are due to last 75 years!!! I can't apply for any cards due to % of available credit being used.
Can you consolidate into a loan which allows over payments? What happens when you 0% runs out.
Banks will always come back to affordability? Apparently I can't afford £80 per month but I can afford £2k per month. Underwriters have no sense!!!!
Good luck0 -
Andy
I understand completely, but it was borrowing from our future, and a period of being a single income, that got us into £68,000 worth of debt by July 2007. Our joint income is £130K. Our financial future looks like this (plan):
We will be debt free later this year.
We will have paid off our DDs student loans next year
We will have paid off our mortgage in 4 years time.
BUT AT THE MOMENT WE ARE NONE OF THESE.
We have well over £2500 a month we pay off our debts, I am obsessed with checking my bank account, budgting etc. Now that we are on the home straight my husband is totally in agreement. He wasn't always so supportive, as he saw our large surplus of income over monthly expenditure as 'disposable income' - so disposed of it!
We include major hobby/social expenses in our budget so we do not feel deprived - if we had excluded them we may have been debt free about now, but they were important and we agreed we would budget to afford it as it only changed the debt free date by months not years. When I recently posted an up to date SOA most people suggested we cut the hobby/social spends. Others understood we were not 'struggling to make ends meet' and supported the appraoch we are taking. It sounds as if this may be your position.Could you do this without pushing you date back by more than say 4-6 months?
We intend to live sensibly after our debts are paid this year to hit the other financial security goals I have listed above. Repaying our debts has been a life changing experience for us.0
This discussion has been closed.
Categories
- All Categories
- 346.6K Banking & Borrowing
- 251.3K Reduce Debt & Boost Income
- 451.4K Spending & Discounts
- 238.8K Work, Benefits & Business
- 614.2K Mortgages, Homes & Bills
- 174.8K Life & Family
- 252K Travel & Transport
- 1.5M Hobbies & Leisure
- 16K Discuss & Feedback
- 15.1K Coronavirus Support Boards