High income but deep deep in debt-any advice?

babyshoes

OP, your wife's resistance to cutting back may be a result of fear of the unknown, or perhaps the known if she grew up in poverty! Ask her what she is most afraid of when you say you need to spend less - perhaps she has a vision of sitting huddled round a candle for light and warmth while eating basics beans on toast... Ask her what ONE thing she absolutely couldn't live without, and see if you can either protect that within the budget, or find a compromise - whether it is having her hair done, coffee with friends, cable TV or whatever.

With your salary, she doesn't need to give up all luxuries or even the appearance of wealth, you (as a family) just need to cut back a small amount on the things that don't really show. For example, I had an aunt who would buy a small pack of 'nice' toilet paper for her guest toilet, and the family were forbidden from using it. The rest of the loos in the household had ordinary toilet paper! You can use the same principle for food, toiletries, cleaning products etc - buy the best for guests and cheaper (but still reasonable) products for private areas.

You said the food shopping is going to drop by about 50% - do you have a plan for how to do that? Maybe try sticking to a shopping list and dropping a brand on (say) 10 or 20 items each time you shop. If she doesn't like the cheaper brand, then when that one is finished you can go back to the regular brand, but must still buy 10 cheaper items.

You mentioned socialising, eating out etc. Could you decline one expensive social invitation each month? There are lots of excuses you could use, but simply being busy with something tedious but necessary like visiting the in-laws is simplest! You could also try inviting people round to your house for dinner and drinks rather than all going to an expensiver resturant (say it is so much nicer to relax on the sofa afterwards than sitting in a noisy resturant). Not something you have to do ALL the time, but again something to do a few times over the next few months.

If anyone comments on you taking your lunch in to work now, just say you are trying to cut down on artificial cr4p in your diet. If you go back to buying lunch in a few months time, no one will turn a hair - and if they do notice you can simply say it was getting boring/taking too much time to make.

I think the point I am making is that many of the changes you will need to make can be explained away to outsiders without mentioning money, since appearances seem to be so important to your wife.

I do agree with the others that you need to sort out the emotional stuff with her, but realise that you need to get your finances stable before you will have the emotional energy to do so. In the meantime, try to handle her gently and compromise or agree to things together rather than simply laying down the law on money, or she may well get the hump and leave with your daughter, which is what you say you are trying to prevent!

Also, once you have paid off your debts, it may be worth saving up a significant sum over the next few years, just in case things go wrong again - and in this turbulent financial climate that is a real possibility. The savings can be in the form of investments such as property, gold, art etc - but try to build it up to a similar amount to the highest amount of debt you got to over the 2 years, since that is obviously the amount you need to live on if you have another 2 year career gap!
Once the debt is paid off, I would suggest putting away half the amount you are currently paying back each month on loan repayments at the beginning of the month - a standing order into a separate account or ISA the day after pay day would work. Use that money to buy investements, as then the money isn't easily accesible to make impluse purchases with such as holidays, but can be mobilised over a few months if it becomes necessary.

Good luck!

Valli

ILW wrote: »

I refer to my earlier comment (Which I have been told off for)

which one?

ILW

Valli wrote: »

which one?

The one about growing things and that nothing will happen if not.

nat21luv

my partners crap with money, hence his 38k debt before i met him. so i do the finances and i believe for him to go and work 50+ hours a week he should be rewarded for his efforts...so he gets an allowance every month to do with what he wishes. it averages at 150pm and if he wants that top he's had his eye on or wants to watch the game down the pub then he knows he has to budget for it because he wont get anymore money until the next payday. slightly childish, i agree, but its the only way he learns the value of money and how to manage it. before i get grief he agrees to this system as he's fed up of being in debt and 'i want to be able to call you my wife'-will not happen if we're still in debt.

why not try this on your wife? she gets some cash every month to buy that unnecessary suit she NEEDS and you can still have control of the finances. why dont you do a months trial?

Kitten_Claws

I actually feel very sad for the op. I wouldn't swap with him for the world. I understand about keeping 'face' in the job - I have to do the same, but I've learned to economise on certain things. Swapping basic clothes from designer labels to Primark for example and making accessories work harder for the clothes I wear. I've also ventured into charity shops and obtained brilliant bargains - labels mostly. It can be done. The OP however has the additional emotional pressure which is a huge burden regardless of his ability to earn such a high salary.

Stress can do more damage than anything else and if the emotions are not brought under control, he may go under with the sheer weight of it all. This isn't just about material possessions or how inconsiderate his spouse appears to be.

This thread is full of very interesting, well thought out and informed posts, from decent people trying to help. Sadly it is also peppered with some not so clever comments which are totally uncalled for.

Errata

The OP appears to have made great strides in not much more than 48 hours.
Grocery bill halved, nursery to be stopped, no new clothes for anyone.
Outgoings reduced by 25% with very little effort.

Valli

ILW wrote: »

The one about growing things and that nothing will happen if not.

FWIW I agree - at the moment it appears the OP is being a doormat to keep his wife (and hence his daughter) and getting mucho stress from doing so.

So he is being walked over.

So sad.

And, FWIW, I'm a woman...

ILW

Errata wrote: »

The OP appears to have made great strides in not much more than 48 hours.
Grocery bill halved, nursery to be stopped, no new clothes for anyone.
Outgoings reduced by 25% with very little effort.

Don't think he has agreed it with her indoors yet.

diable

ILW wrote: »

Don't think he has agreed it with her indoors yet.

*sniggers*

debthelp100830

babyshoes wrote: »

OP, your wife's resistance to cutting back may be a result of fear of the unknown, or perhaps the known if she grew up in poverty! Ask her what she is most afraid of when you say you need to spend less - perhaps she has a vision of sitting huddled round a candle for light and warmth while eating basics beans on toast... Ask her what ONE thing she absolutely couldn't live without, and see if you can either protect that within the budget, or find a compromise - whether it is having her hair done, coffee with friends, cable TV or whatever.

With your salary, she doesn't need to give up all luxuries or even the appearance of wealth, you (as a family) just need to cut back a small amount on the things that don't really show. For example, I had an aunt who would buy a small pack of 'nice' toilet paper for her guest toilet, and the family were forbidden from using it. The rest of the loos in the household had ordinary toilet paper! You can use the same principle for food, toiletries, cleaning products etc - buy the best for guests and cheaper (but still reasonable) products for private areas.

You said the food shopping is going to drop by about 50% - do you have a plan for how to do that? Maybe try sticking to a shopping list and dropping a brand on (say) 10 or 20 items each time you shop. If she doesn't like the cheaper brand, then when that one is finished you can go back to the regular brand, but must still buy 10 cheaper items.

You mentioned socialising, eating out etc. Could you decline one expensive social invitation each month? There are lots of excuses you could use, but simply being busy with something tedious but necessary like visiting the in-laws is simplest! You could also try inviting people round to your house for dinner and drinks rather than all going to an expensiver resturant (say it is so much nicer to relax on the sofa afterwards than sitting in a noisy resturant). Not something you have to do ALL the time, but again something to do a few times over the next few months.

If anyone comments on you taking your lunch in to work now, just say you are trying to cut down on artificial cr4p in your diet. If you go back to buying lunch in a few months time, no one will turn a hair - and if they do notice you can simply say it was getting boring/taking too much time to make.

I think the point I am making is that many of the changes you will need to make can be explained away to outsiders without mentioning money, since appearances seem to be so important to your wife.

I do agree with the others that you need to sort out the emotional stuff with her, but realise that you need to get your finances stable before you will have the emotional energy to do so. In the meantime, try to handle her gently and compromise or agree to things together rather than simply laying down the law on money, or she may well get the hump and leave with your daughter, which is what you say you are trying to prevent!

Also, once you have paid off your debts, it may be worth saving up a significant sum over the next few years, just in case things go wrong again - and in this turbulent financial climate that is a real possibility. The savings can be in the form of investments such as property, gold, art etc - but try to build it up to a similar amount to the highest amount of debt you got to over the 2 years, since that is obviously the amount you need to live on if you have another 2 year career gap!
Once the debt is paid off, I would suggest putting away half the amount you are currently paying back each month on loan repayments at the beginning of the month - a standing order into a separate account or ISA the day after pay day would work. Use that money to buy investements, as then the money isn't easily accesible to make impluse purchases with such as holidays, but can be mobilised over a few months if it becomes necessary.

Good luck!

Many, many thanks.