It's complicated, but I'm optimistic.

Singlespeeder

It's been a long time since I was last here. My life has had some (admittedly self induced) turmoils in the last year. They're my issues and complicated, involving the end of a long term marriage.

I feel a bit like a 'landed gentry' with a stately home asset rich, cash poor. And fairly heavily in debt.

When I walked away from the marriage (kids all grown up, me and wife grew apart, still on really good terms though). This was 8 months ago, neither of us want the relationship to be repaired. I left with nothing other than my car. She is still in the house and I continue to pay the mortgage, and a few sundries. There is something like £180K equity in the house. I'm happy for her to remain in the house indefinitely, the kids live there still but are both in their 20's.
I took all the debt too... around £35k
I've been renting from family so it's much reduced.
I'm also in a new relationship with someone who is incredible with money, an absolute wizard. No debt, no credit, some savings.
I think it's likely I'll move in with my new lady, so some significant savings will hopefully ensue from that.
I have a caravan I need to sell. I'm hoping we'll get around £10k for this. I'd like to eradicate my overdraft, clear 2 credit cards debts, and then take a chunk off the bigger mortgage related debt. Obviously the devil is in the details with this but that's the basic start point.
This would instantly free up £200 pm I'm paying off these CC debts.
I'm cutting up the cards tonight.
Hopefully this can then go off the bigger debt.
I'm 52. I have a pension I hope to draw against to get closer to being debt free. I believe I can access this when I'm 55 so about 3 years. The pension pot is about £75k. I hoped to be able to just take the lump sum and clear the debt and the mortgage (in 3 years this would be down around £30k), but I think I can only have 25% tax free.... £18.5K ... this would certainly make a dent in the big debt.
There are other very long term investments I have that offer no yield right now but will be my retirement parachute.

I will fill in a finances sheet just to frighten me even more ....
With the help of my new lady I'm pretty hopeful I can sort my life and finances out.
Fingers crossed

sourcrates

Singlespeeder wrote: »

The pension pot is about £75k. I hoped to be able to just take the lump sum and clear the debt and the mortgage (in 3 years this would be down around £30k), but I think I can only have 25% tax free.... £18.5K ... this would certainly make a dent in the big debt.

Once you reach 55 you have various options on how you take your personal pension, you can, if you wish, take the whole lot as cash, 25% will be tax free, but you would pay tax on the rest, and this would be at 40%.


Might be better to take it in smaller bites, to avoid paying too much tax.

Singlespeeder

Cheers. It's a couple of years off yet and thought that may be wiser option.... I wouldn't want to be paying 40% tax on it :eek:

Singlespeeder

Turns out the combined debt is near £45k
In an attempt to shift the worst bit, the Tesco Credit Card (it's got a staggering credit limit of £15,200 ! with a balance of a little over £4000,) to a 0% I applied for a Santander 27 month 0% card .
When asked how I intended to pay the debt off, I being an honest fella, said £155 monthly DD. I'd calculated this is what I'd need to pay to clear it.
I got declined. First time ever.
Concerned, I went to Experian and checked my credit rating.
972. 'Excellent'
972 out of a possible 999

I can only suspect Santander declined because they weren't going to make any money on it. Which tbh is fair enough.
Lesson learned.

About to do a SOA ...gulp.

Dean000000

Will yor wife allow you to remortgage to release some equity back to get straight?

fatbelly

There are three adults in the house that you no longer live in, but pay a mortgage for. Can they not take some/all of the responsibility for that?

enthusiasticsaver

I would say is there a reason you are taking on all the debt? Did your ex wife not incur any of it and is she not working? Sounds unfair to eradicate your pension pot almost completely.

tlc678910

Hi,

(Edit I have assumed that you are not divorced and that there has not been a financial settlement?)

I’m not surprised you’re on good terms with your ex - she can stay in the house, you’ll pay the mortgage and pay all the debt too. I bet she can’t believe her luck.

I’m not suggesting you don’t help your ex and you obviously feel a huge sense of obligation to your (adult) kids but the playing field has changed. You need to pay for a new place to live so your ex wife needs to work (if she doesn’t) or do more hours etc and your kids need to pay board. £250 / £300 from each would go a long way - the amount depends what they have coming in I guess.

If the debt is from both of you / some in her name even if you pay it keep all the evidence of payments and negotiate with your ex that her half can come off her house equity.

Agree to sell the house a year after your kids have left home or when they turn 30 whichever comes first. Are you going to spend the rest of your life subbing your ex and with your equity locked in her home? Your new partner will love that?!

You can be kind and reasonable without being a doormat.

Tlc

Edit: you need to be aware that your pension pot is a marital asset (as is any private pension of your ex) and it might not be as simple as you being able to draw it out without her permission - I ‘m not sure how it works but I gather the accounts can be frozen if a divorce and financial settlement is being agreed - if your wife makes a claim. Of course if you plan to use it to pay off a joint mortgage or joint debt then your ex may agree to that.

Singlespeeder

There's my ex-wife. She is a Teaching assistant and doesn't earn a huge amount, £14k at a guess.
My 20 yr old son works and earns fairly well, for a 20 year old, £18k. He pays about £400pcm into the Ex's 'pot'. He's also agreed to take over paying the council tax.
My 19yr old daughter is a Uni student. A veritable money pit.

Singlespeeder

"I would say is there a reason you are taking on all the debt? Did your ex wife not incur any of it and is she not working? Sounds unfair to eradicate your pension pot almost completely."

I think the reason is guilt. I walked away from a decent but unsuitable marriage. Mid life crisis? She didn't really do anything wrong, we simple grew apart.

The house is both of our names. I'm ok with paying the mortgage, it's still in my interest to do so until we decide what we're doing with the house.

The debt was joint, more on my side I guess, but it accrued via house extensions, car purchases, caravan purchases, a variety of things, certainly not all mine. But I'll get them cleared in due course.

Singlespeeder

Great reply TLC !
I have answered some of the points you raise.
While the ex is on her own, I'll keep paying I guess. As and when she meets someone else we''ll review this. I feel disinclined to pay for a (apparently can't use the term fr33l0ader) living in my house. She may want the equity herself, in which case we'll sell the house and divide as appropriate.

The mortgage is under £39k and will be gone in 8 years or likely sooner.
I would hope she's settled with a new partner by then!

Like I said, it's complicated. I feel I have 'to do the right thing' by the ex, she's a great mother to the kids and a lovely person too, just not the right one for me.

I suspect I may be leaving myself open to being right royally stiffed.... but would hope that taking the debt, continuing to pay the mortgage and daughters phone etc would ameliorate the liability. Karma and all that....