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

DebtSurfer

katsu said:

Is there no way to make her ineligible for Klarna? Some kind of payment card they can't take? Do Klarma offer self-exclusion like gambling companies? Could you persuade her to ask them to block her if that's possible? 

I really hope your plan works for you and hope you'll keep posting here as you'll get a lot of support and ideas like the toilet check. Who knows what else will come up like that? 

I could spoil Klarna; problem is, that would just mean more expenses on a standard, interest-bearing card. So even a stunt to "try something on then return" would cost me interest on these purchases.

The Goldilocks solution here is to carefully manage her mood, not be too harsh (as this just depresses her more and leads to more impulse purchases) and not to be too lenient (as this just will trigger 'everything is good' mood and leads to more impulse purchases). Feed her anti-depressants and try to keep off booze (for that, carefully manage her mood). Fragile people, are like that. Push left and it's binge. Push right, and it's "give me that blade, I want to cut my wrists".

Moderate Klarna helps here. £800 Klarna doesn't help here as it just makes next month miserable.

Focusing on good effects of being off-binge helps, doing things together helps, even good sex helps.
===

On a different subject... with all these messages that banks and building societies are withdrawing 10-year fixes, jacking up relentlessly the shorted fixed rate... my decision to pounce on that 3.99% 5-year fix seems wise now!

3 and a half months till the 55th B-day...

Waiting for my turn for free pension consultation.
For now, roughly said, it seems like if I take an amount small enough not to trigger the MPAA, I continue to be eligible to contribute a lot to my pension annually.
That's the intention here -- yes, these "salvation" money will initially leave my pension pot, but their effect will immediately stop me from losing money to interest hand over fist -- and yes, once my modest emergency fund is rebuilt, I can start to pump more money back into my pension! Definitely more than I'd be able to while being on some monstrous DMP.
Only this time, without wasting all that money on stupid interests, and having the flexibility of paying off some unexpected bills when they come, or just channeling the disposable income into pension fund (more likely as the income is higher) or indeed, kill the mortgage sooner, ideally within the 5-year fix period.

For now, just doing what I can to save money. Last weekend answered a few surveys, now I have £26 in my balance. £13 comes from Nationwide cashback scheme. £100 from Nationwide sudden giveaway. "Every little helps."

enthusiasticsaver

What is the situation with selling the Merc? If you have access to another car then that seems to make sense given interest rate rises and likelihood of you getting interest free deals low. Pay off the most expensive debt. How much is the non mortgage debt now? 

MaterialGirl*

I’m not going to comment on your financials as you’ve got good advice already.

Please make sure your wife gets some help! She is seriously unwell and an alcoholic. 

There’s nothing wrong with getting help from outside with her or your son.

I don’t think your son will hate you because you cannot afford him the little joys in life as you’ve mentioned earlier. He may well blame you for not helping his mother get better though and forcing him to lie about his home life. 

There’s a very good chance your wife may not be alive by the time your son is ready for further education.

The situations you describe with doctors and social workers getting involved doesn’t just happen if there’s no cause for concern with a child’s home life. They are already keeping an eye on you. Asking your child to lie is something they’ll see through and it’s not fair on your child to make him do that.

Let’s be honest they are right to be concerned as your son is growing up in an unstable home with his mother being so unwell and your unhealthy relationship. This will damage him for life. 

You might love your wife, but I don’t feel any compassion for her when you talk about her.

Forget financials for a moment, but is this really how you want your home life to be and for your son to grow up?

Your wife has got herself into a situation that she cannot get out of without your support. Talk to her (but not about money!) when she’s in a sober phase and ask her to get help just not for her own sake but for her child and you as well. 

Good luck to you all! 

poppy811

All all I can say is the above poster is spot on Hope you will listen. 

DebtSurfer

enthusiasticsaver said:

What is the situation with selling the Merc? If you have access to another car then that seems to make sense given interest rate rises and likelihood of you getting interest free deals low. Pay off the most expensive debt. How much is the non mortgage debt now? 

Hi.

Merc

Got a few quotes for the Merc meanwhile.

Motorway I tried before and they send a gentleman who won the deal by offering higher price than others (fraudulently as he didn't want to pay this price), and then tried to kick £2k off the price citing some "less than matte surface" on a door. I sensed something untoward happening and sent him along his way, long walk over a short plank.

Selling private would probably bring £1k or so more, but I'm very reluctant to go private, £13k is not cat sneeze, who knows what kind of fraudster people may come out of the blue, everyone says going private = seeing lots of time wasters.

One company promises £12,500 or so, which is not bad. Other places (WeBuyAnyCar and similar) £10,500-11,400, -- which is less-than-what I want for it. Will try these first guys.

Debts and potential plan

Apart from the mortgage, our joint current negative balance fluctuates somewhere between -57k (at payday) and -60k (most of the time).
- Of which about 48-49k are mine
- and 11k are wife's card.

If I wanted to minimise the amount I will take from my pension fund to obtain my "get out of jail card":

1. Her credit rating I am less concerned about, b/c she's not going to get loans.
Might (in theory) even consider "money worries line" and getting a deal on her card, so new spending will be forbidden, she'll get 0% and we then can start paying it off methodically. Yet, even at £333 a month and zero interest, it would take 33 months of payoffs. 
Uneasy because of the association with her at the same address, credit rating agencies may take this into account.

2. Minus say 12k from the Merc, I get the remaining debts on my name at 36-37k.

3. With just £30k from pension (far from the MPAA trigger) I'd kill most of my name debt (leaving 6-7k credit card), and in 2-3 months, when the changes would've filter through to credit agencies, very likely I'll get ability to re-fi the remaining debt for 0% -- alternatively get a loan, but that variant I like less, the payments are not flexible and you're prone to unexpected bills putting you back into cc debt AND the loan is not getting anywhere.
6-7k is realistically possible to clean in 12-18 months which is 0% deal duration.

£30k is not that much, this is literally how much pension fund investment income I received for last 2 years.
Being able to invest again -- priceless.

DebtSurfer

The Black Swan

They say where there's a will, there's a way. And where there's a way, someone will walk it eventually.

My spouse has found her old flame from the diaspora on the waves of the Internet. They thought of that previously, but both were married, so didn't give it second consideration. Now obviously the guy is second time divorced, and she clearly considers herself searching -- after all, why the Eff spend the limited time of your life with a guy who's cash broke and hates all your shopping. Yolo!

Well, long story short, looks like they will be spending lots of time together now, her coming home for about 3 days a week to see the son which potentially can get down to 2.

After second visit, one can clearly see she became distant, snappy, "I know better" attitude. A true winner

Thankfully, I was mentally prepared that something like this will happen. As the song goes, "Where there's no money, there's no love, such is the life, that darned c'est la vie." Just look at this happy couple at the last photos, navigating London Opera House dressed to the nines.

I am not bitter. If someone can make her really happy -- so be it. At the moment, I am clearly in no position of doing so, having all my salary and benefits going to service one and one thing only -- my debts. The debts have been the source of endless bitterness in our relationship, and this is the logical end. There was always something untoward that the shopping was all hers, and the debts -- mine.

So, raising a mug of coffee for the new beginnings. I don't drink alcohol apart from happy gatherings (which are scarce last years) -- my dad's legacy makes a good teacher. Time to deal with the situation. Thus, coffee it is, and good trusty computer.

My son stays with me for now, my dog, my cat, our house for now stays. Of 2 cars, one will have to go. I know, it should've been sold by now, but lots of things has happened and at work there's been a deluge of events and new financial regulations, so enough to say we're all overwhelmed now. Now it's got 25 days to service, so might need one before it goes. Swell.

He started putting some money into my still-wife's account to "give her some financial freedom". He is aware of her card debt but is unfazed by it, the guy got an excellent job and is comfortable with money.

I will for now refrain from new romantic involvements, nobody will want a guy who's £60k in debt anyway, and also I am not ready for female companionship now, what with me practically becoming a single dad for 4 days a week suddenly. So I'll concentrate on dealing away with debts and will execute my list as planned before.

There will be no tears. Good luck to her, and good luck to me. Over and out with that topic now.

Finances

Our company has moved the payday onto 25th instead of end-month. Good news, as for a quarter of month, the salary will be present in the account, before starting to get spent on mortgage and the rest of the bills. Meaning, less overdraft fees, up to £20 a month.

I am really, really glad, that on a sudden hunch, in mid-May, I got off my backside and fixed my mortgage for 5 years at 3.99% before the stuff hit the fan. In just 5 days afterwards, the rates jumped at least 0.45%! Now it seems like 5.5-6% for the same deals is the new reality and it is there to stay, and it is not the limit.

My role at work becomes more and more important. So far this hasn't led to new job titles or salaries, but a my ideas are currently well listened to. See if that translates at least in a pay rise, I'll bless every new £100 I get monthly.

2.5 months until activation of "Deus ex machina plan". Not rushing it, because this will mean I'll turn 55. But it also will mean the viable road out of the sea of proverbial brown product I'm currently still in. Let's start to sell the stuff I don't need. Second car, old phones, child car seat, even a pram which still stands there.

Onward, for new horizons!

Humdinger1

@DebtSurfer you're well out of it! Sorry to be the bearer of bad tidings, but I would meet a solicitor ASAP because there will need to be discussions about splitting financial resources; you don't want to find that she is claiming everything because she hasn't worked for years.  Love Humdinger x

fantasyvsreality

I do feel for you, I really do but good luck to the new man because one day he will wake up in the same difficult financial situation as you are now. I do wonder if your wife has a personality disorder, perhaps borderline.  As @Humdinger1 says, focus on protecting yourself and your son now. What you don't want to happen is for your wife to go back and forth between you both, as in every time things don't go well with the other chap, that she may run back to you. I mean no offence. Take good care of yourself. 

DebtSurfer

Humdinger1 said:

@DebtSurfer you're well out of it! Sorry to be the bearer of bad tidings, but I would meet a solicitor ASAP because there will need to be discussions about splitting financial resources; you don't want to find that she is claiming everything because she hasn't worked for years.  Love Humdinger x

Hi, and thank you for heads up. 

If she's gonna try to claim everything, the more sense it does have for me to claim my own debt recovery first (Deus ex Machina plan), rather than find out that this would have to be paid from my measly half while she gets an unadulterated part.

From what her indication is currently, she has no such intention because at the moment nobody wants a formal divorce; hence no talks about splitting finances. But that question may one day indeed pop up. You're right I must be ready, because on this Earth there's no bottom to human treachery.

Her new love interest was twice (!) cleared up by unscrupulous wives during divorce... Once basically wife took their two kids, 100% of their 4-bed house and all the money and kicked him out (not sure whether maintenance was extracted, too). The second one also took quite a lot. I feel for the guy, but my own situation is also something not to be sneezed at.

[Deleted User]

You really must take action to protect the assets and income that you have. I would consider taking legal advice or visiting the CAB. Things like custody for your child and being only responsible for your debts are important.