Need perspective, help and advice

edited 30 November -1 at 1:00AM in How much have you saved?
3 replies 4K views
Antonio101Antonio101 Forumite
15 Posts
10 Posts First Anniversary
edited 30 November -1 at 1:00AM in How much have you saved?
Hi everyone
I am new to this forum but having been lurking and following for sometime and found it extremely helpful and insightful. Apologies if I am posting this in the correct thread.

Basically I am 30years old and really feel behind the curve in terms of debt/saving and investment. However this also feels like a turning point for the better for me.

My situation is I am married and have a 3year old son. My wife brings home £5-10k part time and myself £60-70k so we earn well. However over the years, largely due to silly decisions made in my 20's and an expensive wedding I am in £35k of debt spread across credit cards with repayments amounting to £1000 a month. Embarrassingly but thankfully by dad has lent me money to ease my cashflow for 6-12months. I have a house (needs decorating thanks to the little one) and mortgage on help to buy but really feel I should have a bigger place by now. Everyone else is moving to larger houses. I really feel I have set myself behind by 5+ years due to my financial stupidity. from 24-30. Don't get me wrong I enjoyed the cars and holidays etc but have nothing to show for it.

Due to this windfall from my dad I really want to turn things around. My aim is to build up an emergency fund (£5k), currently on £1700 and begin to invest. Any money lumped over the £5k I will offset off against the debt.

As it stands I have £1700 in an ISA and hoping to add £500 to this each month
Pay £200 a month into moneybox (general investment)
£50 into my LISA (£1200 current balance)
£30 into a SIPP (£3000 current balance)
£600 into my nhs pension with £700 controibutions from employer (£9100 current balance).

Once the 6-12months is up I will need to take out a low interest loan (once credit score is repaired) to repay my dad.

Can I ask what everyone thinks of the above plan my current standing is? Have I really messed up and set my family behind massively?. I know my debt should be my priority however having no savings is a massive source of insecurity for me as the main bread winner. I want us to have financial cushioning and would like to be able to decorate etc. I have cut up all credit cards

Replies

  • savingwannabesavingwannabe Forumite
    15.8K Posts
    Part of the Furniture 10,000 Posts
    ✭✭✭✭✭
    Welcome antionio, hello do you know what? it's not that bad. You haven't let anyone down but you need to tell your partner so she understands why you will be cutting back to sort it out.

    The great part is that you earn a great income. I would cancel or curtail all unnecessary spending ( don't have holidays, avoid eating out, avoid takeaways) and focus on paying off the debts as these must be costing a lot in interest.

    I would continue to pay into your pension and have a £5000 emergency fund and put everything else into debt repayment and carry on with your SIPP, LISA etc after but I am not an expert.

    Leave the decorating, fancy holidays till later you can get yourself out of this if you hit the debt hard and your wages should allow this fairly quickly providing you focus all of your energy on it.
    Try to have a minimal spend year in 2021
    Saving change in money box.
  • Antonio101Antonio101 Forumite
    15 Posts
    10 Posts First Anniversary
    Hi
    Thankyou for your kind words. Thankfully they are all on 0% interest.
    This is exactly what we are planning to do. I have managed to reduce my monthly outgoings by £180 already.

    I will do. My goal is to be debt free within 3 years.
  • Skint_yet_AgainSkint_yet_Again Forumite
    5.6K Posts
    Ninth Anniversary 1,000 Posts Name Dropper
    ✭✭✭✭
    Hi Antonio well done on posting and taking the first steps to paying off you debt. I'm no expert at savings or paying off debt your size but you may get more great advice if you post your SOA on the debt free wannabe board. You will get lots of advice there bon cutting back & the best way to pay down your debt. Good luck !
    0% credit card £1360 ~ paid in full
    0% Car Loan £7500 ~ paid in full
    JAN 2020 = NOW DEBT FREE
    Emergency fund £1000 / £1000
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