Wow wee oh my - trying to hack away at my £54k debt (was even about to book a holiday)

Rainbowtrousers

TheAble said:

Couldsavemore said:

TheAble said:

Man clean your own house already!

This made me laugh... I hate cleaning!

'Ooo doesn't?! 

But at nearly £28,000 per decade (compounded) just to have someone push a vacuum around and do a bit of dusting, it's surely worth it.

Is the cleaner £54k in debt? I doubt it. "In which case it appears plainly, that "A ploughman on his legs is higher than a gentleman on his knees."" (Franklin)

There's no way I'd outsource my cleaning even were I a billionaire, I'd be too embarrassed. Use the time you'd otherwise be sat in restaurants having someone cook for you and clean your house instead - you'll save twice 

I do get it with the cleaner. I have gone to every other week and will see how that goes. I think for me lots depends on whether i do get a housemate or airbnb my place as no way am i cleaning then. I am really only just getting a grasp on having to compromise on anything in my life and know eventually post lockdown i will start thinking 'do i want the gym or cleaner as having both is not sustainable'. Feel like such an adult!

Rainbowtrousers

alt80 said:

@Rainbowtrousers Mate I don’t think you have the same levels of anger / general lows about this as I do tbh. You seem to have a positive outlook to the whole !!!!!! situation - I’m pleased for you don’t get me wrong there; wish I could have that sort of outlook. I can’t see beyond it - all I can see is I’ll be even older, years with no toys/ lifestyle and no future.

Seems like you are on the right path and financial security is not too far off. Like me budgeting really does feel alien and i do feel weird leaving the old me behind as its so much a part of my personality to be wearing new clothes, planning the next big adventure abroad and looking at 911 C2 specs (formerly C4s ha ha). 20 odd years of bad spending will take some time to change
And then there's Rio to look forward to ....

enthusiasticsaver

Rainbowtrousers said:

I guess in your situation you fall in the middle of those categories.  No offence meant but it seems budgeting was not something you did before and that combined with your lower income is what has led to your debts.  I did not often come up against people in your situation as mortgage payments are usually a priority for most people who have a decent income as you do but as for the other spending they did yes most definitely there was usually an element of regret about past decisions.  I said to them as I say to you.  You can learn from this and move forward.  Just resolve never to put yourself in this situation again and then the mistakes are not wasted.  It is making the same mistakes over and over again which are the problem.  This is why debt consolidation does not work.  People don't learn and keep making poor choices until they are forced to deal with it. 

Yes I am certainly a hybrid of the two which is why i guess i have never had debt counselling as have always been secretly managing. I thought i was being ambitious and adventurous by taking holidays i could not afford and looking to buy another property but in fact i was just burying my head in the sand and looking for another way to pay off debts (as part of the refinance/new mortgage for third place i was to pay off debts too). Thank god that did not go ahead as then i really would be in a pickle. Did not occur to me that tenants could move out or not pay rent! I am certainly being forced to deal. I have had long term relationships before but the last ten years have been mostly short term. Looking back with all this going on behind the scenes (overspending then looking for new/more work or buying/selling flats) it is hardly surprising as that is all so unstable. Anyways as you said you live and learn. As I mentioned before, budgeting is not easy that's for sure. I am going to transfer cash saved to credit cards as i go. So for every £2.50 coffee i do not have i will then transfer £2.50 to one of my credit cards or to my emergency fund on the spot outside the shop so i get the good feeling as right not £54k seems like a long way off!

As you are an accidental landlord would selling your BTL leave you with anything to put towards the debt?  I would not normally recommend selling property to clear debts but as this is a second property and otherwise this will be a long haul to clear decades of overspending I think it is worth considering. In the meantime small changes like not buying coffee out, reducing cleaners  hours or taking lunch from home will make  a difference but this will not be sorted overnight.  I love travelling too but luckily was never tempted to go into debt to do them.  It sounds like you just need to get your head around living within your income and making a plan to pay back the debt.  Once it is gone you have a decent income so then you can go travelling or whatever it is you want to do. 

berries

Good luck with it all. I really like your idea of the coffee transfer on the spot!! I might need to do that myself with plants instead!! Don't like coffee!!
Hair cut is that every month or so?? That's more than mine lol!! 

Just say cars are just wheels that get me to a and b when needed. I've got a focus estate ( or to my friends a minl muck heap) due to either yard mess or collecting logs or wood for my garden project that are still on going!! 
Also i have a dog too. 

Have you tried lidis for food shopping??  I find it much cheaper than tescos even with my discount.  
What other hobbies do you have?? Is there something that you would like to try out?? Maybe running?? Instead of going to the gym?? 

I find keeping myself busy in my garden keeps me away from the shops!! 

Good luck 

ryanm8655

Rainbowtrousers said:

TheAble said:

Couldsavemore said:

TheAble said:

Man clean your own house already!

This made me laugh... I hate cleaning!

'Ooo doesn't?! 

But at nearly £28,000 per decade (compounded) just to have someone push a vacuum around and do a bit of dusting, it's surely worth it.

Is the cleaner £54k in debt? I doubt it. "In which case it appears plainly, that "A ploughman on his legs is higher than a gentleman on his knees."" (Franklin)

There's no way I'd outsource my cleaning even were I a billionaire, I'd be too embarrassed. Use the time you'd otherwise be sat in restaurants having someone cook for you and clean your house instead - you'll save twice 

I do get it with the cleaner. I have gone to every other week and will see how that goes. I think for me lots depends on whether i do get a housemate or airbnb my place as no way am i cleaning then. I am really only just getting a grasp on having to compromise on anything in my life and know eventually post lockdown i will start thinking 'do i want the gym or cleaner as having both is not sustainable'. Feel like such an adult!

Haha! Can completely relate to feeling like an adult! 
My instinct hates the idea of being "controlled" and "limited" by money but it's a crazy way to think really. Now I am in a position where I am thinking, ok, I can live an extravagant(ish) lifestyle and have no chance of buying a house unless I some how get a windfall of cash (highly unlikely). Or I can do what most normal people do and budget... I think it'll make me more grateful for things if I've had to sacrifice to have them. Hopefully you find the same.

EDIT:

Also thought the haircut was on the expensive side Even for London prices...
Do you have a lion's mane of hair? I have become follicly challenged over the years but I used to go to expensive hairdressers back in the day. Then I discovered barber's actually do as good/if not better a job. The trendy ones are pricey but will still more than halve your costs based on once a month...

Rainbowtrousers

enthusiasticsaver said:

Rainbowtrousers said:

I guess in your situation you fall in the middle of those categories.  No offence meant but it seems budgeting was not something you did before and that combined with your lower income is what has led to your debts.  I did not often come up against people in your situation as mortgage payments are usually a priority for most people who have a decent income as you do but as for the other spending they did yes most definitely there was usually an element of regret about past decisions.  I said to them as I say to you.  You can learn from this and move forward.  Just resolve never to put yourself in this situation again and then the mistakes are not wasted.  It is making the same mistakes over and over again which are the problem.  This is why debt consolidation does not work.  People don't learn and keep making poor choices until they are forced to deal with it. 

Yes I am certainly a hybrid of the two which is why i guess i have never had debt counselling as have always been secretly managing. I thought i was being ambitious and adventurous by taking holidays i could not afford and looking to buy another property but in fact i was just burying my head in the sand and looking for another way to pay off debts (as part of the refinance/new mortgage for third place i was to pay off debts too). Thank god that did not go ahead as then i really would be in a pickle. Did not occur to me that tenants could move out or not pay rent! I am certainly being forced to deal. I have had long term relationships before but the last ten years have been mostly short term. Looking back with all this going on behind the scenes (overspending then looking for new/more work or buying/selling flats) it is hardly surprising as that is all so unstable. Anyways as you said you live and learn. As I mentioned before, budgeting is not easy that's for sure. I am going to transfer cash saved to credit cards as i go. So for every £2.50 coffee i do not have i will then transfer £2.50 to one of my credit cards or to my emergency fund on the spot outside the shop so i get the good feeling as right not £54k seems like a long way off!

As you are an accidental landlord would selling your BTL leave you with anything to put towards the debt?  I would not normally recommend selling property to clear debts but as this is a second property and otherwise this will be a long haul to clear decades of overspending I think it is worth considering. In the meantime small changes like not buying coffee out, reducing cleaners  hours or taking lunch from home will make  a difference but this will not be sorted overnight.  I love travelling too but luckily was never tempted to go into debt to do them.  It sounds like you just need to get your head around living within your income and making a plan to pay back the debt.  Once it is gone you have a decent income so then you can go travelling or whatever it is you want to do. 

Thanks for the helpful email. The issue is that the £54k is as a result of the latest batch of overspending (probably about 4 years). I’ve had fresh starts before (I sold a property to clear debts) and also had high paying contracting jobs to clear debts. That said this time does feel very different and I’m sure I wouldn’t do this again. I’ve some grey hairs as a reminder! Selling would feel like giving up a little. I’ve worked it out today and I’d need a housemate for about 3 years and to live on my current budget (assuming I stay in the same job with no big payrises or commission payments - which I get for referring new work). Maybe I should consider selling as the thought of not having a bath with the door open and music on for three years does sting a bit. First world problems ... 

enthusiasticsaver

Rainbowtrousers said:

enthusiasticsaver said:

Rainbowtrousers said:

I guess in your situation you fall in the middle of those categories.  No offence meant but it seems budgeting was not something you did before and that combined with your lower income is what has led to your debts.  I did not often come up against people in your situation as mortgage payments are usually a priority for most people who have a decent income as you do but as for the other spending they did yes most definitely there was usually an element of regret about past decisions.  I said to them as I say to you.  You can learn from this and move forward.  Just resolve never to put yourself in this situation again and then the mistakes are not wasted.  It is making the same mistakes over and over again which are the problem.  This is why debt consolidation does not work.  People don't learn and keep making poor choices until they are forced to deal with it. 

Yes I am certainly a hybrid of the two which is why i guess i have never had debt counselling as have always been secretly managing. I thought i was being ambitious and adventurous by taking holidays i could not afford and looking to buy another property but in fact i was just burying my head in the sand and looking for another way to pay off debts (as part of the refinance/new mortgage for third place i was to pay off debts too). Thank god that did not go ahead as then i really would be in a pickle. Did not occur to me that tenants could move out or not pay rent! I am certainly being forced to deal. I have had long term relationships before but the last ten years have been mostly short term. Looking back with all this going on behind the scenes (overspending then looking for new/more work or buying/selling flats) it is hardly surprising as that is all so unstable. Anyways as you said you live and learn. As I mentioned before, budgeting is not easy that's for sure. I am going to transfer cash saved to credit cards as i go. So for every £2.50 coffee i do not have i will then transfer £2.50 to one of my credit cards or to my emergency fund on the spot outside the shop so i get the good feeling as right not £54k seems like a long way off!

As you are an accidental landlord would selling your BTL leave you with anything to put towards the debt?  I would not normally recommend selling property to clear debts but as this is a second property and otherwise this will be a long haul to clear decades of overspending I think it is worth considering. In the meantime small changes like not buying coffee out, reducing cleaners  hours or taking lunch from home will make  a difference but this will not be sorted overnight.  I love travelling too but luckily was never tempted to go into debt to do them.  It sounds like you just need to get your head around living within your income and making a plan to pay back the debt.  Once it is gone you have a decent income so then you can go travelling or whatever it is you want to do. 

Thanks for the helpful email. The issue is that the £54k is as a result of the latest batch of overspending (probably about 4 years). I’ve had fresh starts before (I sold a property to clear debts) and also had high paying contracting jobs to clear debts. That said this time does feel very different and I’m sure I wouldn’t do this again. I’ve some grey hairs as a reminder! Selling would feel like giving up a little. I’ve worked it out today and I’d need a housemate for about 3 years and to live on my current budget (assuming I stay in the same job with no big payrises or commission payments - which I get for referring new work). Maybe I should consider selling as the thought of not having a bath with the door open and music on for three years does sting a bit. First world problems ... 

Whilst I understand your  concern about essentially taking an easy get out of clearing the debt by selling a property having done this before you must be aware that you are running out of chances to keep doing this.  Whether you clear it in a short period or over a period of years you really need to put some things in place to stop you going down this road again.  I would recommend for a start you do not use credit on an everyday basis.  If holidays are the reason for your debt then start up a holiday savings pot and exercise some discipline to not book one until you actually have the money to pay for it. 

alt80

Feel free to tell me to f**k off but your property situation rings massive alarm bells for me tbh and I’m coming from a position of practically swimming in mortgage debt and personal guarantees so it’s 100 not about me being risk adverse (I’m not) - it’s to do with the fact you don’t seem to have a clue of the correct way to fund property investments or the potential pitfalls. You cannot go into BTL without accounting for voids/ maintenance/ damage/ funding etc etc You need a sinking fund for each property or the portfolio as a whole that reflects the type of properties you have and your target tenant type. I always say to people just starting out it’s a business and you should treat it as such - even if someone else is managing it day to day. Sorry but right now you are not treating it as a business. I feel terrible writing this but you can’t minimise it and you have involved the property by using it to fund your lifestyle (yeah so have I but the difference is you didn’t fully understand what you were doing / the potential implications (wouldn’t have been on a standard res product if you did) - you need to be eyes wide open in business, even if the decisions you make are poor ones you need to understand the implications of those decisions and know what the risk is that you’re taking). I think @enthusiasticsaver is right; liquidating the BTL should be seriously considered as an option and a route to consider. Whether that would lead you back into personal debt in the future - who knows? That’s all down to if you change your mindset about spending.

Understand loud and clear on the lifestyle as being an identity tbh think we’re the same in that regard. ‘Enjoying’ life by spending a lot has been my identity since I can remember and I’m massively guilty for conflating what I can buy with who I am. I’ve had some real low days when the statements for the cards keep coming, minimums going up and available credit going down knowing I’m going to struggle to keeping up buying at the rate I have been and/or have to tell my wife. The avoidance and lies aren’t worth it for me anymore that’s why I’m here. Appreciate it’s different for you not being married so no one to answer to in that regard. 

Rainbowtrousers

Thanks everyone for the replies, support and words. It really is helping. I will reply substantively later today. 
In the meantime my thinking for practical next steps is as follows:
Stick strictly to a budget
Reduce cleaner and haircuts to every other month
No more yoga, reduced eating out/socialising and cutting out all coffees/unnecessary spending etc completely
Pay into a separate emergency fund
Set up savings accounts for things i want and only buy when i can afford 
Tackle credit cards first (0% runs out in May then September next year), then car finance then loan
Rent out rooms or whole flat on airbnb and take extra consultancy work to tackle the debt
Put rental flat on a BTL interest only mortgage - the 'profit' should be enough to cover my tax liability and to put some aside for vacant periods and repairs
Shop at Lidl with a weekly meal plan
Maybe maybe maybe one holiday per year
Am i still deluding myself or is this heading in the right direction?

Rainbowtrousers

enthusiasticsaver said:

Rainbowtrousers said:

enthusiasticsaver said:

Rainbowtrousers said:

Whilst I understand your  concern about essentially taking an easy get out of clearing the debt by selling a property having done this before you must be aware that you are running out of chances to keep doing this.  Whether you clear it in a short period or over a period of years you really need to put some things in place to stop you going down this road again.  I would recommend for a start you do not use credit on an everyday basis.  If holidays are the reason for your debt then start up a holiday savings pot and exercise some discipline to not book one until you actually have the money to pay for it. 

Yes i am staying within a fixed budget now and although the impulses are there to splash out i am fighting it and will drop that habit for sure. I may be able to change my loan to 2.9% with tesco (i would keep the amount the same). My current loan is 6.9%. Assume this is a no brainer? I have set up a holiday savings pot. Really want to avoid selling my rental as feel within a couple of years of putting that on a BTL i/o mortgage which would mean i would have extra cash to pay the tax and some cash to a sinking fund. It always lets so quickly.