I don't think it gets much worse than this. Feel totally beaten

enthusiasticsaver

worriedDan wrote: »

HI

I don't think we are going to take the consolidation loan. As tempting as it is, I do worry that I will fall in to the trap that everyone has referred to in recent posts.

I was thinking that I could call up the CC companies for the cards that are about to increase to 27.9% and ask them if they could consider a lower rate of interest? If not, I will balance transfer elsewhere. Have I got any chance of being successful with this tactic????

Certainly it is worth a try. There are eligibility checkers to see whether you are likely to get 0% balance transfers. As the debt reduces there will be more options opening up for transfers. I think you are wise not to go down the consolidation route. Paying £1500 per month will soon see a dent in the debt.

ReadingTim

firely2327 wrote: »

1. Get back into your pension scheme asap, you'll be grateful for it in the long run

+1 for the pension. Given your employer should be contributing as well (some match contributions up to a certain percentage) then you're missing out on those contributions, effectively losing twice what you think you're saving.

Plus poverty in old age doesn't sound like much fun.

worriedDan

ReadingTim wrote: »

+1 for the pension. Given your employer should be contributing as well (some match contributions up to a certain percentage) then you're missing out on those contributions, effectively losing twice what you think you're saving.

Plus poverty in old age doesn't sound like much fun.

Hi

I had a long conversation with one the pension advisers and it turns out that by taking a year out I will be losing £80 a month when I retire so £960 a year. The adviser did say that I can increase my contributions when I rejoin in order to make up the difference. If I was in the scheme now I would be paying 10.2% of my salary and my employer would pay 14.1. I am going to increase my contribution from january 2018 to make up this difference. I expect to be working for at least another 29 years! I have taken out a lief insurance policy with Beagle Street to cover my death in service grant ( 3x my current salary). This is costing £12 per month. I will cancel this when I rejoin next January.

We have decided to use the money to quickly build up a £1000 emergency fund. From May - January 18 we will use the money to pay down extra debt.

I know that not everyone will agree with this strategy but it has given me some peace of mind.

EssexHebridean

Why the delay from now until May for getting down to paying off debt though? Your emergency fund will take less than a month's surplus?

worriedDan

EssexHebridean wrote: »

Why the delay from now until May for getting down to paying off debt though? Your emergency fund will take less than a month's surplus?

Sorry, I don't think I explained that very well...

We are starting to pay down the debts immediately. The additional money that I get from my pension will build up a £1000 emergency fund in 3 months. I will still be making hefty debt payments alongside this. When the emergency fund reaches £1000 I will use the pension money to pay even more off the debts.

You are right, we could raise £1000 next payday but I would prefer to start throwing money at the debts straight away.

EssexHebridean

worriedDan wrote: »

Sorry, I don't think I explained that very well...

We are starting to pay down the debts immediately. The additional money that I get from my pension will build up a £1000 emergency fund in 3 months. I will still be making hefty debt payments alongside this. When the emergency fund reaches £1000 I will use the pension money to pay even more off the debts.

You are right, we could raise £1000 next payday but I would prefer to start throwing money at the debts straight away.

Got you - yes, that makes a lot more sense! :T You're in a fortunate position that even before you get that emergency fund in place, you're only ever 4 weeks away from the next lump of money that would, by simply not OP'ing debt that month, cover most minor household crisis situations easily.

lazer-zxr

EssexHebridean wrote: »

You're in a fortunate position that even before you get that emergency fund in place, you're only ever 4 weeks away from the next lump of money that would, by simply not OP'ing debt that month, cover most minor household crisis situations easily.

I've used this philosophy to justify not having an emergency fund, now that might not be the right way of doing things, but it's worked for me so far. If I have an emergency, this won't be covered by an emergency fund, but through a reduction in over payments. Something to think about.

EssexHebridean

lazer-zxr wrote: »

I've used this philosophy to justify bit having an emergency fund, now that might not be the right way of doing things, but it's worked for me so far. If I have an emergency, this won't be covered by an emergency find, but through a reduction in over payments. Something to think about.

Yes - for the basic 1k emergency fund that can work OK. Obviously in an ideal world when the washing machine breaks the day after you've shuffled your pay over to the overpayments, you'll wish you had both but that's not always viable!

worriedDan

I have had a positive week after my initial post but for some reason tonight I feel absolutely awful about everything. Just awful.

I am sitting here thinking what the hell have we done to end up in such a huge, huge amount of debt. 55k....

I know that we can clear the debt and that it is actually relatively manageable, but I just feel like such a terrible failure. Despite being more open with my wife, I still feel as though I shoulder the burden of this, even though she is supportive.

I have been reading other posts today and there are lots of people who owe 15k, 20k, 30k...... but 55K!!.... I feel like our debt is in a totally different league to the vast majority of people.

Hoping a decent nights sleep will sort out this mood

EssexHebridean

Have a read of Hypno's posts - her original forum post is the one I've linked to, but you can explore from there. There are others you'll find regularly recurring as posters on her threads too - and you'll see from some of the signatures that your debt is far from unusual.

I'm a big believer in regretting the things you haven't done, not the things you have. Absolutely no point in blaming yourself for it now - take a step back and think what you would say to your wife if she was blaming herself like that?

As you say - a night's sleep and back to it. It WILL all seem brighter in daylight.