Asset Rich, Cash Poor - Me vs £130k debt mountain

DebtSurfer

Hi,

Thought I'll share my story. It is not a typical story here in this forum.

I used to be quite well-off. 

As the things stand on 25/03/2023, I own a house now worth £360-380k (had inheritance, and the mortgage associated with it is just £72k now), a fully paid off Mercedes E-class with advanced engine (still worth about £12k after 9 years). 

I earn between £55k and £70k in different years.
My wife didn't work since 2010 and we were quite comfy.

I made myself redundant from a company of 11 years (made company let me go) and received £45k after tax severance.
In 2010-11 me & wife had buried our mothers but received inheritance.
In 2012 we bought our house (which required a lot of money to set up) and stopped paying hated rent. 

Life was good.

Approaching my 50, my luck has changed.

In 2013, I got myself another lucrative job in London and was earning close to £70k, career was building up.

And then we started trying for a baby.

After harrowing tribulations, endless visits to London clinic, and £25k payments in the IVF clinic, we managed to have a son in Nov 2014.
My wife nearly died from severe blood loss and got post-partum depression.
Then suddenly we discovered he was born with an inherited genetic condition. Which would require a life of care.

Like that was not enough, at this very point my lovely comfortable company with great benefits and job title had burst overnight (finance sector), while I was on paternity leave.

I was complacent, so first year out of I didn't even feel bad about not working.
Then when I decided to get back to employment, I found out that my gap makes this near-impossible. 

Whoops!

I had a safety net of credit cards which kept us from losing the house. But we ran up credit card debt. 

Three full years I have spent on the bench, wife not working. 

Speaking about wife. She's never fully recovered from her catastrophic giving birth (losing 2+ litres of blood) and depression.
She became alcoholic, full time on anti-depressants which during her binge periods she often missed (woe to us all) and developed severe case of shopaholism.

After 3 years my credit card debt + overdraft was £45k. 

There I found a good job and I would've started to reduce the debt... except wife's spending turned now out of control and impossible to stop. So all that I paid off, instantly returned back with her 100th pair of shoes, 220th face cream and 150th dress from blasted Karen Millen.

Having good credit rating still (despite £40k debt) I managed to take a £25k consolidation loan, while juggling paying off my car at £355 a month, mortgage, and all wife's shenanigans on borrowed money. However as the loan was being paid off, the card debts seeped back in... 

Feeling like Sisyphus permanently rolling up my money status, just to see the wife pushing the rock back down.

At some point I had to do mortgage underpayment (out of one-time £60k overpayment reserve) to keep up with all endless bills and 2 loans: consolidation and car (£900 a month to pay).

=== Where we are now? ===

I am turning 55 this September.

My salary + our son's benefits (higher tier disability payment, carer's allowance etc.) gets us roughly £4,050 a month.

I am very good in using all the tricks there could be in managing our finance -- know it all: budgeting, 0% credit card balance transfers, money transfers, snowballing, having all my accounts in Money Dashboard Classic, Neo, and Emma app. This is how I have managed not to lose: our house, our 2 cars, and kept paying off the debts... 

In 2022, I have fully paid off the consolidation loan and car loan (freeing up £900 per month). I immediately started to pay off the mortgage in earnest -- no more underpayments and squandering the overpayment reserve carefully put in by my former, affluent self. It now stands only at £18k instead of 60k (yes, a man had to feed his family...) So out and about, I am barely above the line. 

If not my wife's escapades, I'd probably have £500 left in a typical month.
Problem is currently my fair lady. She either is down with the alco lane, spending weeks in bed, or down the depression lane (lots of "comfortable shopping" in both cases). During fair periods, again there's shopping and shopping again. One card maxed out and another goes in. There is a complete lack of compassion to family finances. I tried explanations, scares, demonstrations, whatever. ASOS, Klarna, look fantastic and sephora... darned be them all.

Not to mention £2k+ for a private dentistry to keep her teeth ideal and I had to spend £1,100 on mine... just for last year.

LEDGER

PASSIVE

1. My overdraft + card debt is fluctuating between £43k and £47k. Some is still at 0% but current situation makes it not possible to shift anything to 0% yet -- need to get balance down then I might receive again the 0% transfer offer from Tesco card.

2. Wife has a credit card she maxed out at £11k (took her just 7 or 8 months from 0 to max-out), instantly wasting back whatever I pay off on her card. The lady just can't hold any money. I don't take her even to shop for food, b/c with her the bills will be 3x as much. It always has to be the best and utmost (but where's the money?!) She's the type that enters Dunelm to buy a towel and runs up a £100 bill. She earns nothing, so this is also my debt...

3. Our mortgage is currently £72k (end March) at the best rate there could be, flexible variable, but the cost-of-living and stupid BoE raising interests means the payments are going up every month or two, what with 11th raise so the rate instead of former golden 1.19% APR is now 5.59% APR and counting. I expect April mortgage bill to become £1,100.

4. Monthly interest on the cards (without mortgage!) is £630-720 depending on the month. Pure waste.

5. Grocery bill is £600 a month. Diesel £100-150 depending on month; I work from home so don't need dry clining, pressed smart shirts, suits and ties.

ACTIVE

1. Our house is 4-bed detached, but in not-so-good area (otherwise we wouldn't be able afford it!) and is worth £360-380k on last assessment, could be slightly lower now due to cost-of-living crisis.

2. I have a private pension (consolidated from all my former providers into Pension Bee), it's currently about £220k and the current employer's one is probably already £7k or so. I am turning 55 this Sept '23, so there is in theory an option of taking a "lump sum" off the pension, however I'm a bit uneasy about this as that would mean all subsequent withdrawals will be taxed in full -- and that is honestly, robbing my future older self. 

SCORING

- My credit score used to be fair on some and good on some.

- Now it's fair everywhere as credit card use is floating between 90% and 100%.

- It will come back once I push the balances off the limits, and even 0% APR deal can appear on Tesco or 7.9% for 18 mts on N-Wide.

SOLUTIONS I CONSIDERED

• Tesco offered me a 0% balance transfer deal. I paid my other cards minimums with balance transfers, then paid off the balance from my account. This left about £1,000 (minimum payments on all my cards) on 0% deal (at 2.9% expense) instead of simmering at the card rate.
• I put everyday spending on cards after paying the minimum, thus reducing overdraft (40% APR) -- however this maxed out all cards at 100%. Now I'm paying off the cards at minimum, but on some APR% grows alongside BoE rate (Barclays, you shameless greedy b's, I'm looking at you!) and interest eats about and above 50% of repayments, bad way too.
• With lots of unexpected bills a family generates (dentists, car repairs, expensive diesel, shopaholic at home) you push down overdraft, but your card debt goes up. You pay off the cards a bit, but that increases overdraft. (I have £5k for manoeuvre and £1k on wife's account as emergency, both are 40% and a bad way of borrowing). Sisyphus comes to mind again.
• With my current score and cost-of-life crisis it's impossible to get cheap loan. They'd offer me something at 22% only. Secure loans I reject wholeheartedly -- there will be no more chance to buy another house if I squander this one, I'm soon to be 55 and my salary is probably peaked.
• Even if consolidation loan would be possible, all it could do would be just to reduce my maneuvre field to deal with Klarna bills wife runs.
• I don't want to confine her to psychiatric hospital. You don't do that to your wife of 17 years...

I don't want any of the ways debt charities would offer (read them all!): bankruptcy, DMPs etc -- that would mean losing house, losing my car and my way of life forever and get consigned to the bottom of society forever. Alongside with trashing your credit rating for years and years. I only got about 12 years before pension time and I want to live them decently, not like a tramp.

I seriously considered running a GoFundMe.com donations round to get out of this stupid debt, which does not belong to my ways of dealing with finance at all -- but then, would you give even 1p. to a person with assets surpassing £600k? I don't think so. You'd just say "mate, sell yer house like normal people do, go rent" -- but the truth is, renting even 2-bed would be £1,500 where I am and would sink my finance. And that'll be forever in current circumstances.

I am able to swim due to lots of measures I took earlier in my life. And therein lies my hope...

... and the pension lump sum thoughts warm my heart...

SUMMARY

• I have lots of debt, but it is (barely) manageable with my iron fist on money and a (remote) control on wife's splurging for utterly useless stuff. 
• I have lots of assets, so would be stupid to go bankrupt or something.
• It is however quite difficult to make ends meet. Yes, £4k net income are hardly able to maintain me. 
• I keep paying off my mortgage, but cost-of-life crisis bites harder every month, as if they wanted to drown me. Every month now £300 goes to stupid mortgage interest, which shouldn't even be there -- if not the adversities, I'd have it paid off !!!
• Guess I am at full denial to typical advices like: mate, sell your E-class Mercedes and buy a 15-year-old Focus, sell wife's car, scare your wife to death so she stops spending, or institutionalise her, open your own business, get a promotion... but have you tried to do all that while juggling your son without wife's help, spending a lot of time at your work because it's important, and trying to get at least 2 hours for yourself (me being a bit, err... neurodiverse)...
• I am not taking any steps which will kill my credit rating. No DMPs no bankruptcies no nothing. Losing house would increase living bills 1.5x fold at least and sink my finances instantly. Losing car would hit me to the core. 

I am 54 and there will be no second chance to buy another house if I "downsize" my house.

I hope I'll get that promotion to department head and a pay increase (even £1k in addition would sort me out quickly) -- but no one is offering me that as of now.

So I'm kinda stuck in a stupid situation. £600k+ assets -- and £58k or so debt + £72k mortgage -- and I can't spend anything on anything but the absolutely necessary bills and have to shop at Lidl to keep the grocery costs down. Holiday in Ibiza is only a wet dream now, wife is looking for her next man "who can take me on a holiday at least!" and for me it's just hamster wheel...

======================

Pour yourself a cup of tea, before you will leave chuckling... "man, I don't have £50 extra and you drive a Merc and dare to come to debt wannabe forum!"

Maybe there are other people who are in the same situation.

What are your thoughts of it?

Purplelady65

I’m sorry to read about your situation - it sounds very difficult. Lots of information in your post so just picking out a few things: 
- Taking money out of your pension now is not a good idea. You will only regret it later in life. 

- spending £630-£720 every month in interest only sounds horrendous. If you could reduce this that would be a start. Not sure how but I’m sure OPs will have plenty of ideas. 

 - Would this be better posted on debt free wannabe so you could do a soa and people make suggestions? 

- Is there some way you could limit your wife’s access to spending and credit cards? Could she have a debit card with a set amount on for the month? How much is she currently spending a month? Unless you can reduce her spending you are stuck. Incidentally although your wife sounds mentally unwell you can’t decide to place someone into psychiatric care. There are actually a tiny number of beds in inpatient psychiatric units and the vast majority of mental health care is delivered within the community. Is your wife accessing any talking therapies? 

- Try and keep the roof over your house whatever else happens. As you say selling up would put you in a worse situation as renting would cost more. 

Good luck with it all. 

WinterWarrior

Poor you. Honestly we all have different situations here and no one will judge. I had a spendthrift ex and I really do understand how awful it is. Definitely don’t take from your pension, that would cripple you in the end. Your wife could easily divorce you and take half of it and half of the house so I think you need to handle things carefully, but you do need to draw a hard line under the spending. I would be tempted to cancel her cards and put blocks on any unnecessary spending. If she wants to spend then she needs a job..easier said than done, I know. Also therapy as mentioned above might help.

I don’t think you’ve quite had your lightbulb moment yet. You recognise what is happening, but not the lengths you might need to go to to improve your situation. Downsizing might work as you would be mortgage free and still own your own home. Is it worth cruising right move just to get an idea of what you could buy for around £250k? 

Have you heard of Dave Ramsey? He’s a bit ‘American’, but a lot of what he says translates to the U.K. well. Listen to some of his YouTube call ins, look up his baby steps and read some of his quotes on Instagram if you have time. He makes a lot of sense to me. Some of my favourites are ‘we buy things we don’t need, with money we don’t have, to impress people we don’t like’ and ‘act your wage’. I think you can pull this back, you just need to devise a plan and then carry it out. Good luck 🌟

in_need_of_direction

sorry to add to your woes but I know, in NI where I am, alcoholics are excluded from being detained under mental health legislation. You may need to check that out.  Have you considered engaging with al-anon who support the families of people with alcohol difficulties?  Also, can you start returning her purchases?

tacpot12

I'm also sorry to hear about your situation, but I am also impressed that you have held it together for so long. You are doing a sterling job, and your loyalty to your wife does you great credit. 

I would agree about not taking anything out of your pension. You don't have enough! I retired with a DC pension pot of £360,000 plus two small DB pensions (paying about £2,000 a year each) and a full state pension (if I make it to 67), and I judge that I am only safe to withdraw £16K a year (£1,333 per month) from my DC pension. You won't be able to survive if you deplete your pension. 

You don't need to swap your car.

Hard as will be to do it, I do think you need to do something about your wife's spending, and I actually think you might need to go as far as divorcing her. I say this in the expectation that if you did divorce, you would stay living together as man and wife, but having severed your financial connection with her. The problem is that she will never agree to this because it will clearly be a pre-cursor to you stopping the behaviour which has facilitated her excessive spending. All empathetic readers will appreciate the severe trauma that your wife went through when giving birth, but it's not acceptable for it to be used any longer as an excuse for torpedoing the family finances. So if not divorce, what can you do?

A Power of Attorney might help as you can contact the credit card companies, and credit reference agencies to cancel cards and put notes on her credit account (e.g. you have to countersign all credit applications). She might be prepared to give a PoA if you explain how it might help her, but if she doesn't agree she has a problem, she won't do this either.

I think if you were to force a divorce on her, she would then own half the house, her car, and have half your pension. You can't really afford to let her have half your pension as you would be very poor in retirement, but I think you might need to consider whether you would be poorer still if you kept your pension, but she didn't change her spending habits. 

It's very sad that you should have to deal with this, but you do, so there is no point doing anything other than also having a cup of tea and getting on with it.  

DebtSurfer

Thank you all for your kind words
This is a reply for all really.

Having lived in this situation for a few years now, but remaining positive and aware of anything that can help, having a math degree, does help a bit.

1 - RE: pension dip.
You're right, taking a 25% tax-free lump sum out of my pension is not a thing that comes easy to my mind. Elsewhere on this forum I strongly discourage a poster who thought about putting their £12k bonus into pension and dip into it 2 months later, with a "calculator" in my hand.

This is a nuclear option, indeed. It would give me £55k to spend now, which would kill my card debts + overdraft almost entirely, leaving something like £3k which is a click to get rid of. And there's still 12+ years to grow back the pension pot to the size which would last me my whole life. 

Problem #1 with this method is I'm not sure that my fair lady won't run another card debt.
Problem #2 is it would start the MPAA, so plans of getting rid of debts and boosting the pension to the max to tax-optimise everything would be under peril. 

Not good indeed.
But of all the bad options I have (it's a fallacy there is a choice between good and bad here -- there's only really bad, very bad and catastrophic options here) it might seem like the one I'll be able to recover from eventually and still enjoy some good retirement.

2 - RE: monthly interest spending. (Categorised in my MoneyDashboard Neo as "Waste").
It looks like a bastion of debt on the first sight. No access to 0% deals b/c of only "fair" credit ratings and lousy affordability (high outgoings), no way to improve rating immediately due to 95-97% card utilisation ratio.

Solution here is to try & overpay Tesco card. At 90% or so utilisation it will probably resume a 0% for 12 months balance transfer at 2.99% fee offer. That would immediately give me some breathing space. At around 85% on N-Wide card their (unattractive) 16.9% for duration + 2.4% one-time fee -- can turn to more lucrative 7.9% APR for 18 months.
These two would give me manoeuvre space for "swinging" -- "washing off" debt coming at full interest via transferring repeatedly between the two cards. At 2.99% from the debt amount I would get 0% breathing space from 17-19-21% debt for a year. Not getting out, but some hundreds off the interest bill.

I nearly was able to kill the 40% overdraft by redirecting all the spending to cards. Thought that would be a one-off need. Maxed out the cards to the hilt but had only £1000 of overdraft left. Would kill it next 2 months... Then wife needed a few teeth removed and crowns made. That'll be £2,200 please! (demotivating soundbite).

Currently I was not touching the cards, concentrating on reducing interest from overdraft by directing spending to current account. It started to move... 96% card balance instead of 100%... then Klarna notified me (yes, I have her account on my phone) that there's £800 to repay in next 15 days, thank you very much. (demotivating soundbite)

3 - RE: correct forum
I believe this subforum is the correct space. After all, it is my diary first & foremost, I had it before in my own app, now this part of it is here. It's a not one-off question.
StepChange advisor told me I'd better move my posting out of the question thread.
I agree.
I believe they can't help in my case. The solutions offered to people critically in debt are a poisoned chalice, with all due respect. They are for people who are unable to cope. In return for moving you forward somewhere, they burn your credit rating, some of them deprive you of your assets, they try their best to make you believe that saving every penny and living a life out of Charles Dickens' novel is your new normal.
I am able to cope, it is "duro" (hard) but I'm not complaining much (even though it's so tempting). 

4 - RE: the elephant in the corner -- wife's spending and her mental tribulations.
You're right. You don't "put" someone into a psychiatric care or even psychological help courses in our country.

What courses?... we are talking about a kidult person who can easily miss her medications when drinking binge, and unless reminded, won't even take them. She doesn't think she's mentally ill. She just says she's "unhappy". That's depression for you. Forget the meds 3 days and there'll be sharp objects near her wrists. I already took her out of a noose once (will spare you the gory details). 
She says she'd happily go to work. But talk reality and she doesn't want to go to Tesco stacking shelves or as a data entry operator. No, we are creative... We need to be an architect or designer. We aren't prepared to do anything for that. 

My analysis found that she spends as a way to comfort herself. And drinks for the same. Bottle and shopping "take her away from the dire reality" (yeah, don't have to work, eat Finest range, have own car looked after by someone else, have a phone and a tablet, have countless dozens of dresses, skirts, shoes and purses -- that's her version of "dire reality", because we don't go to the pub twice a week and stopped going on holidays -- what a disaster!) And any attempt to talk about money is "boring, I hate this, stop pestering me you bore, you make my life hell! don't talk to me about this ever, you suck my life out of me". 

Here we have a person with immense lots of wishes, complete lack of means to implement them, zero energy (thank you that blood loss during giving birth which led to severe anemia, knackered liver (hello champ), diabetes (choccies are so delicious!) and hypothyroidism (forgetting to take medicines often)) to try & change that. As a result, massively frustrated, going to swingers (coming back after proffering lots of love etc.)

In this situation...

My way of limiting her spending is not repaying her credit cards past the bare minimum. This way it is only small amount before she hits the hard limit and cards stop working. Then she crawls to me asking to buy "just this perfume" and "just that little coat!"

Her debit card I surreptitiously took away. This way she won't run a £1,000 overdraft still available to her. I need this reserve as an ultimate reserve if push comes to shove... It is currently at 0, whatever indirect spending on her account there is, I suck it to my (permanently overdrawn) current account.

Klarna is my personal hate. It allows her to spend up to a 1k -- where normal credit providers would give her an elbow. Then I must pay these off because otherwise it will kill her credit rating and I may need it later when digging us out of this cosmic pit. I really hope they will start taking credit ratings into account and limit offerings to 100-200-300 for people with bad ratings.

So long story short, I can't stop her spending. But I can make it difficult. I think a person starting her day with her phone on Amazon, ASOS and Karen Millen does deserve some limitations. Only one problem: I am rubbish in being manipulative, gaslighting and all the rest of the criminal arsenal -- that's just not who I am. And after all, I still love her -- and believe it or not, so does she (when I don't talk about money).

What about her alcoholism -- it is not standard; it seems to be situational. She'd go strong for 2-3-4-6 weeks and then suddenly one not-so-good evening, she'd request "bubbly" to "lift the mood". -- or indeed a gin-tonic. Next day it could well become 2 bottles of wine and beginning of a new binge which can last 2-3-5-8 weeks. Until the liver says "aaahhh", eyes turn lemon yellow, and other unsavoury details. Then it's a week of migraines, being fed in bed and painfully slow recovery...

"Limit her access to alcohol"... Excuse me? She's a grown up adult. The only thing I can do is categorically not to let her drink drive. That I can by all means. If she wants to drink the law doesn't allow me to stop that. And she'll sneak out of the house via back garden, go to OneStop and buy it anyway. 

The solution here -- as we both agree, me and her -- is to getting ourself to happier place. Regretfully it requires a decent job for her, pubs twice a week with the best food, and holidays 3 times a year somewhere warm. But maybe a small country break with us, our dog and a son could help a bit? It can. And then it's forgotten and she's back to her depressive self. 

My friend from the community who is an NHS psychologist urges me constantly to refer her to the doctor. You know, once they get ahold of you, they start collecting info about you. And social services will start digging. Thank you very much. Once a pediatric consultant concocted a circle of doctors, nurses and occupational therapists behind our back and seeked a Level 4 intervention (basically that would be telling us what to do with our son and no way out of it unless you wish him taken away) -- it was all based on awful lies, but everyone played along! including our GP who seemed a lovely lady. They collected a "meeting" where I was not allowed to translate to my wife (they brought along a translator who had to do it), and made an awful "trial" full of lies and misconceptions.

We were able to fend off the children services, proving that we are, indeed, upstanding citizens and not some trash, and we love our (disabled) child. But the experience was so traumatic that next time I hear about sharing something with NHS professionals about my wife or kid -- I want to scream and attack the speaker. Social services are mostly a digging breed who constantly look how to burrow into your life and start "intervening". Please don't mention that to me... ever. 

I am not taking her there.

5 - RE: keeping the roof over our heads

Completely agree with you.
This is my absolute priority.
Our inheritances came into this house, they came at different times so were able to buy this house and decorate it and everything. It was a gamble, a new development in the midst of one of the worst slum part of our "vibrant town". It could turn great, or extremely ugly.
In a commuter town next to London it would only buy us a 2-bed.
This was our chance to get a decent house for money we had.

Now it's 11 years down the road, and we can say it turned out well. A very international estate (nearly 30 countries). Well knit together (we have internal WhatsApp groups), currently fighting to wring out of developer's managing company stronghold. Lots of people who are in their 30's and 40's, who moved here to have kids, strong parental community. Lots of people in tech. Lots of diversity. You can find an occasional Tesla, BMW 8 or indeed my E-class, as well as 15-year-old Fiat 500 or a worn out 05 reg Corsa. It is not a shame here to be affluent or poor, black or white, straight or gay, ... you name it -- we don't discriminate.

For some people, downsizing may seem like a logical option, but all it will do, it will move us into a crappy little house. 4.5-bed may seem a lot for a dad, a mom and a son, but it allows everyone to have their own space. I imperatively need a separate office for successful work, period. Mom reads and adds beauty in hers. Son has his space for quiet games and building models.
Our son is also hyperactive at its biggest, so without my home office, it will be impossible to work.
Also, when selling, all our little things that we built like a proper shed, garden irrigation tools, bin space, lovingly planted trees -- will bear no value for the buyers. 
And we have no money to start it from scratch.

Also what would downsizing give? Getting rid of mortgage. Maybe full, maybe a part. But losing a significant financial buoyancy tool as well. It's in my eyes worse than yielding £55k off pension pot, in this country houses never lost momentum for last 30 years. My hope is to downsize when our son is out to University, that's probably in 10 years or so. Then we can add this delta to the savings and get ourselves a small 3-bed: our bedroom and one office for each. If we downsize now, we take this delta now and de-invest it from property -- losing hand over fist. 

These stupid debts are not worth losing our "Home where our hearts are".

enthusiasticsaver

There is a lot of information in your posts so forgive me but I have not yet had a chance to digest all the information.  You seem to be fighting on all fronts with the debt, money management, your sons disabilities and your wifes  mental health so I just wanted to reach out and say welcome to the diary section and you will get lots of support. Lots of positives too in that you earn well and you have a house with a small mortgage and a reasonable pension.  Like others I would urge you do not use the pension to pay unsecured debts. The monthly interest on the cards is worrying but it appears you are able to pay minimums so a DMP is not the way to go.  You seem to be fairly on the ball financially so I guess you are repaying the most expensive first.  Prioritise the mortgage first.  Don't get rid of the house if it works for you. 

Will your wife reach out to AA to help with the alcoholism and can you just remove her from accounts to stop her spending? 

DebtSurfer

tacpot12 said:

I'm also sorry to hear about your situation, but I am also impressed that you have held it together for so long. You are doing a sterling job, and your loyalty to your wife does you great credit. 

I would agree about not taking anything out of your pension. You don't have enough! I retired with a DC pension pot of £360,000 plus two small DB pensions (paying about £2,000 a year each) and a full state pension (if I make it to 67), and I judge that I am only safe to withdraw £16K a year (£1,333 per month) from my DC pension. You won't be able to survive if you deplete your pension. 

You don't need to swap your car.

Hard as will be to do it, I do think you need to do something about your wife's spending, and I actually think you might need to go as far as divorcing her. I say this in the expectation that if you did divorce, you would stay living together as man and wife, but having severed your financial connection with her. The problem is that she will never agree to this because it will clearly be a pre-cursor to you stopping the behaviour which has facilitated her excessive spending. All empathetic readers will appreciate the severe trauma that your wife went through when giving birth, but it's not acceptable for it to be used any longer as an excuse for torpedoing the family finances. So if not divorce, what can you do?

A Power of Attorney might help as you can contact the credit card companies, and credit reference agencies to cancel cards and put notes on her credit account (e.g. you have to countersign all credit applications). She might be prepared to give a PoA if you explain how it might help her, but if she doesn't agree she has a problem, she won't do this either.

I think if you were to force a divorce on her, she would then own half the house, her car, and have half your pension. You can't really afford to let her have half your pension as you would be very poor in retirement, but I think you might need to consider whether you would be poorer still if you kept your pension, but she didn't change her spending habits. 

It's very sad that you should have to deal with this, but you do, so there is no point doing anything other than also having a cup of tea and getting on with it.  

Thank you for your reply. Somehow you managed to get straight to the core of it without going trite on how important it is to "make a budget and stick to it", "make every pound work", "find some extra job" (hey, I build large systems, am I supposed to get on my Merc and start delivering pizza? and the work takes all of my time and energy, I'm after all 54 now, doing my best but I'm no energizer bunny anymore.), "sell some old stuff" (the only thing to sell is my old phone, but £80 I want for it won't get me out of debts!) 

Yes, these were the most important questions that came across my mind.

The awful "D" word. Divorce.

At the point where she went looking she promised (under influence she can sometimes get a second, cantankerous, personality) to "take my son, my house and me out of her life". She later apologized profusely for her second ego. No one would give her the child, with no income and a story of substance and credit abuse, easily provable if I wanted to destroy her... which I don't. With all her problems, she's my wife and mother of my son who didn't come to us easily. 

However the rest of the threats are very real. Divorce would assign me to pay maintenance to her as she has no income and such is the land of the law. It would destroy half of my pension and probably still leave me with all my debts bar her credit card. It could force to sell the house and start renting again. It is a catastrophe to rent when you are 54 and with child. I've seen a friend of mine where his wife of 25 years forced him to divorce. The guy managed to save a house but had to pay her off a six-digit. He's now 56 and saddled with a huge mortgage. They have spent £80k combined on the lawyers, are now both broke and hate each other with their guts. Just, NO.

Also my son would have to stay with me chained to me like a ball to the prisoner's leg. With no mom around, he'd have to go everywhere with me (a hyperactive child, aha) or go into childcare (have you checked the prices for it?! there's no money for childcare). It would be a train wreck of a life. Also with her soon to turn 45, she spent three years on Tinder trying to find me a replacement... she failed, and admitted openly about it.

I already decided that divorce is a good way to turn our life (and the life of our son who loves both Mom and Dad) into a living hell.

==

Currently I see two ways out of the situation.

1) The Pension Dip Route

I turn 55 this Sept 2023.
I would have £55k or so tax-free lump sum.

That would kill almost all my card balance and leave only £3k on one of cards.
I would attack this balance with all my force.
In a month or two I would get a 0% deal on my Tesco card for 12 months, buy it for £90 (2.99% fee), and will move the remaining balance there. 
I would establish the schedule of repayments for these £3k -- that's just £250 a month for a year.

My card minimum repayments are currently about £1,200 roughly. Naturally these would stop.
About £800 of that freed up money could start going into mortgage in overpayments (mine is a variable deal with maximum flexibility, and no ERPs, so I am free to pay off as much as I can any time).
The remaining £400 would go to building an emergency fund of about £5k for starters, then be diverted to finishing off the mortgage.

Then I'd start to work on replenishing the pension, increase contributions by £400 a month, choosing to pay one gap in my NI that I had due to unemployment.
Agree that £170k is not enough for retirement, but then I still have 12 years+ until state pension age.

Job done...

2) The Hard Way

In short:
- Get rid of overdraft first, these are 40%. -- however they aren't accruing interest the entire month. Consider moving bills before salary instead of straight after salary, until I am more comfortable with finances.
- Find a card with maximum APR% and start attacking it in earnest, while paying minimum on others. 
- (typical snowball) 

Not typical steps which I'm famous with, would be:
- Calling the CC providers Money Worries line and seeing what they have to offer. Nationwide said they'd be keen to stop the interest on the overdraft, but then it would come at a cost... overdraft fees are just 30-60-90 pounds a month (depending on the rest of situation), and that would be marked as agreement with a lender, hitting at my credit score.
I am very reluctant to take this route, as credit score - even fair - is important for all the limited tools I have. 
- Thought about selling my Merc, paying off 1 of the cards immediately, and starting to use wife's car as our main car.
At one point I received a £14k offer. The guy came, went around, started talking BS and saying the car "has been repainted" long story short he rang someone and came back with a £12k offer. I sent him ... along his way, into a long pedestrian journey. What a scam. 
Wife asked not to sell the Merc as she "wanted to have her car for herself". It is just an 12+ years old Volvo V50 with 200k miles, but I spent £3k on making it neat, structurally sound and driveable (pet project). I also imagined that if I were to sell the Merc, I'd be consigned to crappy old bangers world forever.
Someone may be humble enough to tolerate this, for me it would be a big hit; my car is the place where I relax and enjoy some life quality, or what's left of it. 
- Wife would not take physical jobs, b/c honestly she is not up to speed -- during her migraines I had to lead her down the stairs in my house as her legs trembled... c'mon, be serious, she's not up to it, period.

-- 

So far I'm alongside this Hard Way route, consistently reducing my mortgage, so instead of 110 k it is now only 70. Blasted BoE keeps increasing rates and so up go my mortgage and some card interests. If I felt more secure at my job, I'd remortgage it to a 5 year fixed rate deal when the rates were low. But I'm glad I didn't -- my life is too unpredictable now, and I want the freedom of overpayment/underpayment (with my current deal)/paying off entirely for my mortgage, rather than to be bound by fixed rate rules with ERP, no underpayment etc. I need the leeway.

DebtSurfer

in_need_of_direction said:

sorry to add to your woes but I know, in NI where I am, alcoholics are excluded from being detained under mental health legislation. You may need to check that out.  Have you considered engaging with al-anon who support the families of people with alcohol difficulties?  Also, can you start returning her purchases?

Thank you for your comment. I am really grateful for them all, make me feel not so alone in my uphill battle.

Will start with returning her purchases. 

Yes, some of them go back when she's sobering up. I don't even need to do anything about it. Sober version of my wife will instantly spot a piece of clothes she won't really wear, and ASOS return is 30 days. So often I'll go to send stuff back in bags via EVRi -- at least this is some money back in the fray, which are really valuable addition in current conditions.

She wouldn't return all of them. Motivation is... differing... "what do I wear with these deep pink shoes? only a pink skirt really." or "why do I keep 2 sizes of this jumper? but what if I grow weight again? what am I supposed to do?"

Now to the psychological help and anon-alco for friends/family

The NHS psychologist friend of mine, who knows the stuff from inside well,
and
was strongly urging me to go on the anon alco friends/family members group,
said it would start as anonymous, but at certain point there would be a de-anon to join some groups or treatment...
and
when I asked whether at this point social services would be made aware, ... 
She said "Yeah, but you shouldn't be afraid of them, they are reasonable people". 

My viewport was filled with REEEEEDDDDD in a microsecond.

I already told my son to never blab too much in his school as they have this "parent link manager" or whatever it's called, a "very friendly" (and very inquisitive) lady who keenly snoops after pupils and collects intelligence about the pupils, by "friendly chatting" to them, but in reality trying to figure out if there are problems in families.

They start with innocent questions like "have you brushed your teeth today?" or "I have noticed the colour of your pants today is the same as yesterday; did you change your pants?" (Seriously, !!!!!!?! but these are both actual questions they asked my son). They ask whether they spend a lot of time gaming on his tablet computer. Where did you go on weekends. Does daddy take you somewhere nice? Is daddy nice to mommy?

I gave this little example to show how the social services are always trying to snoop into your life, but because our son is registered as disabled (he walks and talks like a fully healthy guy and with his modern advanced medicines so he is -- but make no mistake... this stuff needs to be managed well, or else) -- this tendency is stronger. They are watching like a hawk over you to make any mistake and be able to pounce on you. 

Our son will never say in school that mommy "drinks wine". He can say "mom is just sick, and she lays in bed". And dad will smile and say "she's got terrible migraines and her infections just won't clear three weeks in a row!" or "we are trying our best to help with her anemia". Which both are true, just not entire truth. 

You can't just send them to hell, as they will only start to snoop with double effort. "Iuppiter iratus ergo nefas." -- "Jupiter is angry, therefore he is wrong".
The correct way to deal with the spying lady is to disprove all the myths, break all the suspicions they come up with -- all with a super friendly smile on your face and a plausible story. Thankfully you can easily see where they are going and counter that before they start going into suspicion.

Now forgive me but inviting the very snoopers into our life, that we're trying to keep out by all means, -- even due to mom's affliction looks like a good invitation for yet another "paediatric consultant" to concoct yet another "meeting of concern" to consider taking control of your family's life.

Believe me, I'm not paranoid. My mental health is so far extremely good. I may be a bit tired, but that'll change later.

I just have been through this earlier in our life, when our son was small, the modern super dooper medicines were not yet invented, and we had to spend occasionally 2 weeks in hospital with our son each time they would find certain bug in his sputum.

poppy811

Just a suggestion.  You sound overwhelmed and I suggest you pick one thing to concentrate on and then the next.  Nobody cann deal with so much in a one er 

DebtSurfer

My main scare

My main potential scare of these days is to lose the job unexpectedly. I experienced this twice when after 50. I had to move my career sideways -- again -- as the old career just petered out with the coming of cloud services everywhere. I have used my wide set of skills to secure another job and start learning in yet another area of technology. Second job was easier to get as I already had an experience with the new area. 

What can go wrong? When wife is down the binge and there's just not enough time with myself due to: son being fed and ferried to/from school, medicated, read before sleep and put to bed, dog walked 2x a day, cat fed, wife fed, medicated and helped, all shopping there to be done,
-- I start digging into my sleep time to get the vitally necessary solitude time. There be dragons though, eventually you become dull and can fall back on work performance... sitting in front of a laptop screen and staring at the today's to-do list...

At one point in my life, I was so in demand that I never ever left a job into nothingness -- my next job would be already in-waiting when I stepped out of the current one. I wish to return to this route. I am really a good specialist, and despite this being my third career, the old ones never went away, they do help a lot in my work.

Last period without a job, just 4 months, had cost me more than £5k net and kicked back my financial recovery a year back probably. Overdraft had swollen up again and cards balance started to rise (Sisyphus came to mind again . I did have my retaliation on a stupid American religious freak, my manager, who did arrange letting me go because I wouldn't follow his work ethics and would know better how to deal with difficult customers. But getting avenged didn't change the minus £5k result.

Christmas without a job

Have you ever experienced Christmas without a job? I had. Four times. While people take their unused holiday dates, go buy presents to their loved, set up trees, all you could really feel is:
* Christmas tree £55 - nope, we will use our artificial trees this year. Yes, they are even better than sawing down a living tree.
* How much for this set of transformers? Naw, we'd better get something from this section. Savings: £30.
* No, I don't need anything from Santa. (I do, my phone is 4 years old, and there are no more updates, which is h3ll for an IT/developer person -- but it's going strong, so we'll stay together!) 
* No, Jingle Bells don't sound Christmassy. "Single bells, single bells, single all the way -- S4t4n has come to you on this blasted day" -- your grumpy self creates that instead of a smile.
* Christmas songs in shops make you want to scream. They are so out of sync...
* Some people out there, with jobs, just are waiting for Christmas, New Year, their next salary and annual bonus. All I know is dreaded bills season starting on 1st Jan. Mortgage, water, energy, internet, mobile, insurance... card 1-2-3-4-5, overdraft payment, .... No salary, just measly Universal Credit or Unemployed benefits. Every 4 weeks...
(DO you really think my wife stopped shopping??? no way).

How to stay afloat

When there's no job, or yet another fat bill drops into your inbox "There'll be £500, 800, 1200, Sir"... it's easy to get depressed and start feeling sorry for yourself.
Don't be tempted though.
It won't help, but you will feel like cr4p and will be less able to sustain the environment.

All is not gloomy though. You collect small joys.
* Every pound in is a joy.
* Heard about an app which asks you to scan your receipts? Then suddenly you get a £20 Amazon voucher. Yay!
* Answering surveys. Don't go for them all, go for those which pay. Ka-ching! 2, 3, 5 pounds... suddenly there's £20 and you can withdraw. That just was a difference between staying within overdraft limit and busting it. Yes, I managed again!
* Deal in supermarket is a joy. 
* New movie you watched at home is a joy. Torrent costs nothing.
* A book you read is a joy.
* Driving somewhere in a Merc is a massive, unsurpassable joy. To those who will try and advise me to get rid of it to pay one of the many cards... sorry, you don't understand how much does it mean to have an island of sanity in this sea of bills, bad news and uncertainty. 
* Going to the car service and they found nothing to blame -- just charged you for the service and that's it! Yay!!
* Imagining what the life will look like when you got a job again -- massive joy.
* Getting a positive response on the job interview -- even more massive joy.
* Tesco sent an email that you're eligible for 0% balance transfer! -- gigantic joy!
* Managed to sleep 6 hours -- wow, I really feel like new! (Usually I had only time for 3-4, this keeps you going but barely.)
* Lost some weight -- well done man!

You look around and the world is still full of small joys and some big ones. Yes, everything is distorted towards financial events. But not always.

And this, my fair lords and ladies, keeps you floating.