i am so scarred - not sure best thing to do

wanderlust27

I am scarred of the unknown as .... I am self employed so my income isn't as secure as an employee.....my son leaves full time education this yr so at the end of august I will lose my widows pension and child allowance and tax credits....which is a massive loss in income for me.

At the end of august I'm scarred I am totally on my own financially...and its worrying me

I am not actually in debt......but I need a cushion of money due to my unpredictable money

I have the following debt
Loan £9650
Mortgage £13000
Overdraft 1 £1907
Overdraft 2 £1676

I just operate from month to month in these overdraft accounts and I never get them down even with all my government help....so I worry what will happen in August how I will manage

I have £35000 saved in my building society and at present £16893 in a current account saving account.

But I have no retirement pension savings and I am 50 yrs old. THats all I have.

Also I am helping my son with car running costs and if he goes to uni he will need me to help him to buy things so its not just me to consider

I am thinking should I use some savings to pay off the loan as thats £220 a month payments.Then I could try and live frugally and get the overdrafts down.

I sometimes feel I am a failure...when I look around me.....as I have no pension I am 50 yrs old and I hardly have any savings once my debt is knocked off. I worry a lot.

I think I have to go into my savings to pay some debt down.....do others agree ...otherwise I think it will hang over me for years as I can't get it down very easily.

Ilona

Hi. You say you are not actually in debt, then you list four debts that you have. I'm confused. You have very big savings, is that why you say you are not in debt? Seems daft to me. Why not pay off your debt then you will be debt free. I suspect more details will be needed before anyone can help with advice.

Perhaps you could complete a Statement of Affairs where all incomings and outgoings are listed. This would give a better picture.

Try this.
http://www.stoozing.com/calculator/soa.php

Ilona

PS. I have no savings, just a small emergency fund. I finished work at 60 and have been living on a state pension for seven years. Easily managed and I have a good life. I had a mortgage and managed to pay it off by being super frugal.

andyfromotley

Great woeds of encouragement from Ilona there.

Post an SOA to get started.

You are in a better position than many who have huge debts, low or no income and no pension. You are obviously pretty handy at managing money as evidenced by your savings. So here are some random thoughts for you.

1. You know that your income is going to drop significantly so you need to focus on two things. Increasing your income and decreasing your outgoings. This may mean getting a job and abandoning the self employment. Kicking uop the self employment to another level or taking a side job?
2. Get rid of your debt. I would pay it from my savings, all of it, tomorrow. But either way its holding you back.
3. Form a long term plan for retirement. Lets say you retire at 65? You need to save like billy O between now and then. You will be amazed at how much you can save. So you will have saving in the bank, a paid for house, no debt and a state pension (?) that will put you ahead of a lot of people.

You are not a failure!! You are just worried about changing circumstances. You can face these and thrive with hard work, determination and a plan. Get to it!!

sourcrates

Hi,


Sorry, I don't understand what your concerns are, apart from your mortgage, you have 3 relatively small debts easily settled from your savings, and you would still be left with 35 grand.


Most people on this forum would kill to be in such a great position.


You say your self employed, and that money is all you have, well lots of folk have much less than that, I can tell you.


Don't forget your income may be unpredictable, but the chances are you will do ok, changes do happen in life, at 45 I had to start all over again from scratch, without a penny to my name, five years down the line, I'm not doing too bad.


Lets face it, you cant do anything about the cuts to your income, you just have to get on with it, and make the best of what you have, no point worrying about it, just get on with it.


You don't mention what you do for a living, I`ll have a guess at builder ?

dirtycredit

If I were in your shoes I would definitely get a job with regular wages and do the self employed stuff evenings and weekends. My mum's 60 and she has gone for a few new jobs recently with no experience in the field and has been offered posts in all of them.

You're not a failure you have loads of savings so you are in a better position than most and your mortgage is nearly paid off so you won't be homeless.

FBaby

What's your annual income from self-employment?

McKneff

Pay your debts out of your savings.

you would be debt free and also save a fortune by not paying interest.

Like most of the others I cannot for the life of me understand why you do not......

tlc678910

Hi, you are not a failure. You have so much to be proud of.

You have raised your son and it looks like (in recent years at least) you have done this alone. He is fast on the way to becoming an independent adult, considering university, and has you to thank.

You have held on to your house and now have only a small mortgage left. You could settle all of your debts today, including your mortgage, and be in credit. You have achieved this by the age of 50!

I understand that you are worried about the future. You may need to adapt to your son growing up and moving out and your finances will need to adapt too but you can do this from a starting point of looking at all you have achieved with your head held high.

For a couple more years you will support your son as far as you are able (while he also strives to support himself) and then you will have over a decade, from a starting point of being debt free, to squirrel money away for you and your retirement.

Could your son consider university close to home so that he can save on rent? His loans and grants could contribute to the household, or could you rent out his room while he is away?

Wishing you the best of luck
Tlc

SalemD

In your situation I would pay off ALL my debts, and live with less cares.

You are not failure, money does not flow evenly, and it is not the be all and end all. I heard once, it is more important how much control you have, rather than what you have.

dancingfairy

You have some decentish savings but there is little point keeping your savings safe and earning pitiful rates of interest whilst sbellung out interest on your debts.
I'd suggest getting rid of the loan and the overdraft. Give yourself a clear slate to begin with ( apart from mortgage ).
Df

dancingfairy

I would do a budget for how things are looking in the future. If you get the loan paid off you won't be having to pay out for that each month so bear that in mind.
You need to have a look at the budget and see whats what and see how much you have available to support your son.
With regards to work it might be best to work on an average figure for the income - does it fluctuate massively or is it not quite so dramatic as that ?
Is self employment working for you? Self employment is great if it pays the bills however some people delude themselves and struggle on when sadly they'd have been better off getting a regular job.
If being self employed is working out/ is sensible continuing with have you looked into any help for small businesses with marketing / promotional work etc? Joined any networking events / relevant trade or industry or local chamber of commerce groups?
If you need extra money can you fit in am evening job or Saturday job or some other part time job alongside your main job?
Df