high income high debt!

-taff

optimizm wrote: »

I should stress that I want trying to appear like I was bragging about our income

I didn't think you were.


I'm more worried that you don't seem to know how you've ended up with this debt.
Go through your bank statements and credit card statements from the last three or six months to see where you are spending it. If you want some help with budgeting, post your SOA. Be warned, you may hear things you don't want to listen to if you do this, but no-one does this to annoy or upset you, they see it bald and call it bald.

optimizm

Hi Taff
I haven’t posted anything that suggests I don’t know how the debt has accrued. I am acutely aware that our debts have mounted through years of over spending on things we don’t need. It hasn’t crept up in us, or taken us by surprise. We’ve allowed It to happen through poor choices. We’re accountable so now it’s time to get it sorted.

CakeCrusader

It depends on where you're spending and what you're buying. If you're replacing your wardrobe every season, like to keep up with the latest gadgets, like to eat out a lot, like those holidays or new cars, the debt is bound to increase (this has nothing to do with income by the way, a lot of very rich people don't live very frugally). Credit cards are useful, but the tendency to whack a few weeks of groceries onto one and to spend a few hundred on bits and bobs (it all mounts up), thinking you'll pay it off in a month or two is strong. That 'I'll pay it off in a month or two' rarely happens though, as there's not much left after the bills have been paid and after you've eaten out a few times and gone shopping and not everyone has the ability to pay it off in full at the end of the month (my highest card's limit is 3 times my monthly salary, I'd never let it get that high though). The following month a little more is put onto the credit card, thinking 'I'll pay it all off in a month or two', and that doesn't happen either. Before you know it you owe thousands on a card. People on lower incomes can't do this as they don't usually have access to the same funds, or maybe they are just spend savvy.



It would be wise to take a look at exactly where your money's going, and see how much you can pay off. 49k in unsecured debt would really worry me to be honest, it doesn't matter what my income is, if I had an accident, if I became unwell or if my hours/pay fell I wouldn't be able to pay this off. Your debt to income ratio's really not good.

Mermaid89

I think its all relative really. I work for an insolvency firm and its not unusual at all for people with higher incomes to have higher debt as the % of lending is nearly always the same as someone with a lower income and a lower amount of debt - hope that makes sense!

optimizm

I’ll do the SOA over next day or so. Some general figures-

Take home 5050
Mortgage and all other bills and direct debits 1200
Minimum debt payments 1400
Food/ fuel 400

This highlights just how badly we’ve been overspending as we have spent the spare hours become, and then some!

So whilst things are bad, I don’t necessarily feel that the wolf is at the door, providing we take action now

CakeCrusader

1400 a month is a lot to spend on minimum debt payments. Are you paying interest on these too? Any chance that you can balance shift some of this onto a 0% or lower interest rate card? It will free up some cash so you can put this towards clearing some of your debt.

-taff

Look to see if you can move some of the debts to 0% if they aren't already.

System

optimizm wrote: »

I should stress that I want trying to appear like I was bragging about our income- I have nothing to brag about when it comes to finances.

I do think our income is reasonably high though- around 78k joint, I think. Is that considered average?

Not massively north of average really

tlc678910

If you have cards that are no longer on 0% I think the interest will shock you. If you keep paying the minimum on those you will be paying them for decades and pay thousands in interest.

It will also worry you I expect if you work out how much your debt will cost if all your 0% offers end.

You need this knowledge to drive you to act and get those cards overpaid.

Tlc

optimizm

Just looked and apparently the average uk salary is 27.6k