24K debt, 25 years old, work in a bank = problem!!

Alisonbel

I'm by no way an expert otherwise I wouldn't be in the situation I am BUT you seem to have lots of "if and buts" and "when". Seems like you need to make some decisions sooner rather than later.
like the previous poster it's better to impact on family time now than later when they need taxiing to football etc My son gets upset because Dad can't come to watch football because he's working.
At the moment I work nights and OH works days we don't see much of each other but we know in a few years our debt will be paid and we can start living again not just exsisting.

SHEARERBOBS

gpage2000 wrote:

Thanks Timmne.. it does make sense, we've not really thought about full time childcare, as we would rather bring up the kids ourselves i guess... but it's better than ending up in more debt with no security,

My fiancee could easliy earn 1000 after tax, and so would be great, but we'd then be looking at a heft care cost of probably £200 per week, and a loss of a massive chunk of the tax credits... but i think with us both in work we can apply for up to 80% back on the cost of childcare.

She is planning to go back to full time work, but when the kids were in full time school, which is 1 year left for our son, but 3 years for our recently born daughter!

We will add it up and see what happens, but perhaps a part time job for her... evening even, as if she is working less than 16 hours, it'll not affect the current benefit too much.

I had thought about a weekend job, but again i've got the dilema of not spending time with the family vs clearing debt.

If i could somehow freeze everything for 3 years i'd be fine, as then i'd be in management, taking home say 2k, and fiancee say 500 min... then we'd be fine, as we would be able to clear the debt at a rate of £1200 per month!

Perhaps i have just answered my own question!?

Hi Gav

I'd definately look into the childcare. When i had my little boy i worked part time in evenings whilst OH looked after bambino. But now i work full time, so does OH. Nursery is £550 pm full time and we receive £640 pm tax credits, so we get 80% paid for :T . Definately look into it!!!!

Sarah

KatrinaC_2

gpage2000 wrote:

taking that my 1/4ly bonus is going to be around £500 to £1000 in April, if i manage things well, i might just make it work. BUT then it will take me about 20 years to pay off my credit cards?!?!

It sounds like you worked for the bank I used to work for and I had real problems getting them to pay my bonuses. I also waited 2 years for back pay from my current employer (several thousand pounds!) before it finally arrived.

Relying on bonuses and back-pay and other lump-sum pay outs doesn't always work because even the best employers will find a way to delay paying out or not pay at all.

If your wife does go back to work, the chances are that you will get child-care tax credits to help towards the cost of care in either a registered nursery or with a registered child-minder. You might lose some of the income based money, but you are likely to gain on the child care side. The other thing to remember is that you don't both have to work at the same time - there are plenty of jobs in the evenings and at weekends which either of you could do. Take a look at the "Great Bit on the Side" thread for more ideas.

Kat

gpage2000

Thanks again for everyone's tips.. the only thing is.. that i'm finding it hard to disregard the idea of a secured loan. My mortgage people NorthernRock will offer me the total debt for a mere £155 per month, bearing in mind i'm paying over £500 on the debt now. Yes it's over 25 years, BUT....


NOW - £24K DEBT = £550 per month, would take near 10 years to pay off (and it means sacrificing family time on a huge scale)

OR... £24 loan @£155 is affordable, plus we can overpay by £100 per month NOW and then in April my pay rise will allow for a further £100 per month over pay = £355 per month means debt paid in... wait for it.... 6 years 11 months!! That is taking into account interest rises and a small regular pay rise.

If my fiancee worked also, that's another £100 so £455 per month into the debt, meaning another 2 years off the term.

There are no fines for paying early as it's flexible, just working the same as overpayments on a flexible mortgage. And i've checked the t's and c's with an ex-solicitor at work... no limits on overpayments.

Surely this is better than losing time with kids? I'll save tonnes of interest, and years of debt, and still pay less out than i am now... and it's not even taking into account the fact that my pay will go up a lot over the next few years, doesn't count my bonuses or the fact my fiancee will begin work again soon...

i haven't found a catch yet, and we have learned well not use credit cards or personal loans again... ever!

Be good to hear what you all think about this one:j

gpage2000

Oh forgot to say , we worked out that to get this loan paying £200 a month overpayments (easily within budget) not only would the term go from 27 years down to less than 7 years, we will save...

£20,000 in interest

and it works out that we're getting an interest rate of...

1.6% APR!

CRAZY!

Where do I sign?


:j

blisteringblue

I worked for the Bank of England and owed 26k against all their rules. Told them about it fully expecting called in and sacked, well I was called in alright, at the time (1993) they had a special personnel councellor who talked me through setting up payment plans etc, which they helped me manage.

I did get an instant FINAL WRITTEN WARNING though which of course went on my personnel file but I didn't get sacked.

I have since moved out of the finance sector but thought I would share my experience.

Do you know of any precidence at your organisation for sacking?

CLAPTON

i never have trusted bankers and having seen your maths (APR ???) i'm even more convinced.

however, a low interest rate loan is better than a high interest rate loan... and indeed if you can over pay by 200 per month the period will come down to 7 years.
in your circumstances, as you can't do DMS /IVA / bankruptcy nor can you repay then a secured loan is perhaps the only option consistant with keeping the job.

i would really suggest that you work on that budget.. it didn't seem realistic to me and you haven't updated it with all the missing things.

I hope it all goes well and i does seem a one off get out of jail card but only if you live strictly within your means.

jet77

Hi,

I'm absolutely knackered so am not going to read all of your thread so apologies if I'm repeating what's already been posted. I just wanted to say that you seem to be well on the way with all the things you are doing.

There's a benefits calculator at https://www.entitledto.co.uk which you can play with to see how much tax credits you'd be entitled to if you had childcare costs and your partner went back to work either part time/full time. As a rough guide my childcare costs are 75 pounds part time or 130 full time p/w. The majority of childcare providers run morning and afternoon sessions. If childcare runs over 2 sessions you have to pay full time fees (e.g. I work from 0930 - 1430. My childminder picks up my daughter from school nursery at 11.15 and then I meet her at the school where I collect my other daugher at 15.15. But because the morning session is 7.15 - 1300 and she has her after 1300 I still have to pay full time fees despite collection her at 15.15).

Hope that makes some sort of sense and best of luck.

Luv Jx

PS welcome to MSE

Iwantmorecash

Speak to the credit dept at work, if you tell them you cant afford the payments they may look to reduce them , but they will only do in house, or look at a staff loan as the rate is lower, securing your debt on the house is not good, as if you get into further probs then it bye bye house. I can see your problem with working in a bank, but it say in caontract that your credit should be "in good order" now the definition of that is not clear, so i would ask hr but dont give too much away to them.
well thats my 2 peneth,
good luck

chivers1977

I work for Barclays. We can take a staff loan at 6.2% which is not credit scored. They look at your bank statements though. I know that we aren't allowed to have an IVA or be bankrupt but I am sure that a DMP is OK.