Third-Life Crisis

Magpie100

Well done, Goingroundincircles!

You've gone from saying 'Car was a mistake but no point investigating it cos it's done now' to finding out what the actual situation is and the options available. It may be the options available don't help you much at the moment, but you have lost NOTHING by knowing exactly what they are and where you stand. I know it's hard to face up to past mistakes like this - it feels easier to just 'park' that decision mentally - so well done on going and FINDING OUT about it all.

Now - what to do? You say you still have 8 months of the contract to run before you reach the halfway point. Good. That gives you 8 months to try and find a way round this. My view is you need to do all you can to get out of this contract. You just can't afford this level of car with your level of debt. Sorry. And as you have correctly identified you wiull be stuck on this PCP/HP merry-go-round indefinitely if you don't find a way out.

I hate to suggest this, but is there any way family would lend you say £1-2K to buy a cheaper car outright? Or, could you keep your ear to the ground and see if anyone in your family is making murmurings about having an old car they want to get rid of? It might seem in the realms of wishful thinking, but 8 months is a good chunk of time to ask around. Even I probably wouldn't suggest you go car-less with a newborn (I am assuming your OH's van wouldn't be suitable for all three of you). I know owing money to friends and family is fraught with difficulty, but only you know oyur relationships and what might or might not be possible.

I agree with enthusiaticsaver that it might be worth approaching the dealer, too. Can you downgrade the car for cheaper payments going forward?

Whatever happens, you have drawn a line in the sand and now you know exactly what you owe and what you don't. Now we need to try and find a solution.

Goingroundincircles

Thank you for your thoughts enthusiasticsaver and M100. Well the motoring board has been an eye opener! It seems that actually my best option is to continue with the payments and then look to pay the balloon at the end with either a 0% card or low rate loan. That way the car is mine and I can keep it until it no longer goes! Considering it's a 2 year old Polo this should be a very long time! Apparently that's the best way to make these PCP work for you.
By the time the balloon payment is due in Aug 2020 we will have finished paying off both of our loans (Jan 2020 and May 2020) so will be in a position to either save that £400/£322 respectively or to put that towards credit card debt and have a good finance option available to us in the Aug.

Either way we are not in a position to be able to end the contract now so have some time to ponder the options! At least I now know what options are available to us

Goingroundincircles

Thought I'd do a little round up at the end of each month keep of track our progress. This month has been a little slow due to only getting my bum in gear after the start of the month and already having to cover an income shortfall. Hopefully the numbers have gone down though! Next month I'll be able to show how much the debt has reduced.

Lloyds - £2880
Halifax - £2374
Barclaycard 1 - £6194
Barclaycard 2 - £9192
MBNA 1 - £6158
MBNA 2 - £3340
MBNA 3 - £3932
MBNA 4 - £2115
MBNA 5 - £3746
Mum - £1695
Tesco Loan - £9300
Sainsburys Loan - £8398
TOTAL - £59,324

We've made lots of little changes and accepted it will take a long time before it looks like it's making much difference, but mustn't get disheartened and give it all in!

Magpie100

Well done on finding out about the car! At least you now know exactly where you stand. I really feel for you because it is such a lot of money to pay for a Polo - but you know that already. At least you now have a plan in place for 2020, and that will come round fast, I'm sure. Whatever you do, please don't take out a new deal for any other car! I'm so glad you posted on the motoring board now - you now have a plan and can 'park' that expense for the time being.

No, don't get disheartened. You are at the turning the debt tanker round point - once you can get a bit of momentum going that will really help. You need to be watching everything like a hawk, though. Any progress on dropping the payments to your mum to free up some cash for higher-rate cards?

enthusiasticsaver

It will take a while to start making any impact on the debt. My guess is you have been in debt close to 10 years or more given you are 30 now so reducing and eventually clearing it will not be quick. At least you are not adding to it though. If your mum is able or willing to let you reduce your payments to her that would allow you to address the credit cards with the highest interest rates.

I still think you may have to consider getting rid of the car and getting a much cheaper one. Is it big enough to carry the pushchair?

Goingroundincircles

M100 - I have had a chat with my mum, she does need the £100 at the moment as she's trying to save for a new bathroom and kitchen. She did say if things get tighter we can look at it again though. She supports us in so many ways that I don't want her to think we aren't grateful, so I'm happy with that for the moment.

enthusiasticsaver - luckily we did try the pushchair in the boot before MIL bought it, the first one we tried didn't fit! Why do they make them so big?!

Goingroundincircles

Can't believe we're nearly half way through March, where has the time gone?!

Interesting month so far...

Good:
- Have made a bit of money selling things so that's going straight towards the debt
- Have managed to keep all food shops in budget so far
- All savings pot are still intact at the moment

Bad:
- Husband has spent all his diesel/spending money for the month already
- Vodafone are beyond useless and hadn't updated our plan AGAIN, so after another high bill and 2.5 hours talking to them I cancelled the contract early

So, in regards to the last point I need some advice! The contract will end on 4 April with a £57 early termination fee (we're recouping this cost by selling old broken phones). I know it was silly to end it early but I cannot stand having to deal with their incompetent staff anymore. And another 2 months of high bills would have been nearly £57 extra anyway. We do need a new phone as my OH's is broken and not making his work life easy. I'm thinking an iPhone 6s so it is a slight upgrade on our current iPhone 6. At the moment I've found deals for around £26pm with a small upfront cost which we could pay using cashback. BUT is this the most sensible MS way of doing it??

Also, if anyone has any suggestions on the OH point, I'm all ears!

enthusiasticsaver

The only thing which made my OH think about what he spent was for him to have a personal budget and joint account made untouchable as only for bills, salaries in and transfers out to various pots. OH and I each have a personal spends account. No bailing out although I have to say we use a cashback credit card for diesel and food so if this is the reason for your OH overspending our method wont work. Hobbies was my OHs downfall so the personal spends account worked for that.

IPhones are so expensive so is there no way your OH would use another type of phone? I balk at paying contracts now on phones and prefer to buy the phone outright and go sim only. Not apple though as they are overpriced.

Magpie100

Hello Goingroundincricles,

Well done on having a chat with your mum. Another thing that you don't need to waste more time thinking about - clears some head space! And well done on your wins this month.

Now...to your 'Bad' list. Petrol - why has there been an overspend in the diesel category? (I'm not being facetious!). You need to know why. Is it because the diesel budget isn't enough? Is it due to unexpected trips this month? Is your OH spending the diesel bit of the budget on other stuff? You need to understand why halfway through the month you are in this position, and quick! If he is spending the diesel money on other frittering things then you really need to stop it quickly. Diesel has to be a priority, presumably, so he can work. You aren't in a position where you can just pull extra ££ from somewhere else. At the worst, he is not going to be able to get to jobs to earn money if he doesn't have fuel...

And the phone...I don't know much about phone deals, but I would second not going for an iphone They are so expensive, and I just don't think with your level of debt you can justify it unless you find a really good deal. And you especially shouldn't be upgrading at this stage! And I mean really good deal. And then your OH would need to have it as his Christmas and Birthday present.

I know you'll hate me for the above! But I feel as if wanting an upgraded iphone is a mental step back in everything you have done so well on so far. What does he need it for that a different, cheaper phone can't do?

Keep on keeping on, though! All progress is good progress.

Goingroundincircles

So we have a joint account where the bills etc are paid from and each have a personal account which I put that month's fuel money and spending (if there is any). OH's fuel obviously does vary from month to month depending on where he's working so I do need to keep an eye on that, but this month he's spent it on hobbies! I honestly don't know what goes on in his head sometimes. I've told him he'll need to find the money to get him through the rest of the month by selling something/earning it some other way. Hopefully that will make him think before he does the same thing next month. I'm not perfect and we are trying to massively change our habits, so it won't happen overnight but..!

Phones! I will actually be having the phone (OH will have my current one) and the plan will be his. Here are my thoughts on getting an iPhone 6s:

- I'll be stuck with it for at least another two years so in my head it fees sensible to go for something slightly newer?!
- I use my phone as my camera and am very into my photos, therefore the camera quality needs to be good.
- For the same reason I want to be able to easily upload/back up the photos to my laptop. OH has always had android phones and trying to get photos onto the laptop is a nightmare. Plus every time the phone is broken/upgraded everything is lost.

I just had a look at the Google Pixel 2 which is supposed to have a very good camera, but it's more expensive than an iPhone 6s. You can buy the iPhone 6s for £430 with a £10pm sim on a 1 month contract. So I was thinking we could use our emergency fund/maternity savings and then pay it back to the pot over the next year. Or is that still a silly idea?

I know you'll hate me for the above! But I feel as if wanting an upgraded iphone is a mental step back in everything you have done so well on so far.

If everyone agreed with my thoughts and decisions I wouldn't need to be here!! :rotfl: