0% Balance Transfer or Loan?

londoner2019

Good luck with everything. As you suggested, all the spends are household, and not so much for individuals. So the debts should be considered joint, even if they're in your name.

Just by laying everything out in the SOA, as well as suggesting solutions (the coffees and take out), you can tackle this!

NeverendingDMP

Hiya as someone else who has spent I don't know how long trying to get the other half to see the full financial picture I wish you luck. 
I think getting as much on O% is your best bet for the moment. Your VR would give you 12-18 months of just in case money whilst you look for another job. Potentially though if you are both savvy with the funds it could be used for debts/to start a deposit fund.
Just some general comments around your budget though if that's okay. Your childcare costs are massive. I've experienced the same when mine where younger. It's a huge but necessary knock to the finances. Do you use tax free childcare/are you eligible or if not have you got it in the diary to use as soon as you are. 
A Monzo,chase or separate debit card that you preload might be an idea for groceries just to highlight it as a spend that easily over runs. And some will offer cash back and rounding up of spends too. If baby is still young then nows a good time to gently track the spends as baby led weaning, toddlers and children in general can up the budget really easily. Will OH family be happy to contribute extra to flights when baby has to have seat of their own on the flight-just a thought for the future. 

Emmia

NeverendingDMP said:

Hiya as someone else who has spent I don't know how long trying to get the other half to see the full financial picture I wish you luck. 
I think getting as much on O% is your best bet for the moment. Your VR would give you 12-18 months of just in case money whilst you look for another job. Potentially though if you are both savvy with the funds it could be used for debts/to start a deposit fund.
Just some general comments around your budget though if that's okay. Your childcare costs are massive. I've experienced the same when mine where younger. It's a huge but necessary knock to the finances. Do you use tax free childcare/are you eligible or if not have you got it in the diary to use as soon as you are. 
A Monzo,chase or separate debit card that you preload might be an idea for groceries just to highlight it as a spend that easily over runs. And some will offer cash back and rounding up of spends too. If baby is still young then nows a good time to gently track the spends as baby led weaning, toddlers and children in general can up the budget really easily. Will OH family be happy to contribute extra to flights when baby has to have seat of their own on the flight-just a thought for the future. 

I think whilst the idea of a different account for groceries is fine in theory, it requires the OP and the wife to be disciplined to use it like this, and not to "top up" or buy things  using other accounts / credit cards.

Troublesum1

Hi All,

Not sure if I should start a new thread as my question is now quite different to what it was before but I think there’s probably some good background in the thread so for now I’ll post here. I confirmed my VR and thankfully I was lucky enough to get another job that I will be starting in the new year. The VR essentially is £40k after tax and of course I will be looking to clear my debts with this money. 

I felt the overwhelming advice from everyone was to get a 0% card for as much as I could and work hard on my budgeting. So I did just that, managed to get the wife to do a lot better with things and we’ve limped along to this stage. Now the focus is on setting us up in a way where we can save a good amount of money, get on the housing ladder and stay in control of our finances. I’m really here just to ask for general tips. I’ve been using the site becleverwithyourcash to see the best savings accounts and current accounts. I’ve also been doing the bank switch deals on there. 

One major query I have is with regards to going for a house: Despite getting the VR we will have no savings and our savings journey will start in 2026. The LISA looks like a great opportunity for us to save towards our first house but the likelihood is that we would be wanting a house worth over £450k. We have a young child already and if we’d want a spare then we’d need 3 bedrooms which is pretty tough for £450k in the Essex area. We could maybe get away with a £450k house for a couple of years then move onto a bigger house but the hassle and stamp duty (?) doesn’t seem worth the £2K (assuming we as a couple could get the max government bonus over 12months) that we could get from the LISA. Both my wife and I are 35yo so I think we’re also pushing it with age getting a mortgage and waiting it out might not be wise. That said, we are starting from zero savings and it’s likely we’ll need a couple of years at least anyway to build an acceptable deposit. We essentially are in the situation where we have good income (£140kpa combined) but very poor capital. Any advice would be very welcome.

Aside from saving I am looking to make our spending more efficient with the use of the most optimal bank accounts and smart budgeting. I plan to pay the bills out of one account (or maybe 2 to get the best rewards etc) then save a fixed % of our income and then after that split the money into pots (groceries/personal/family) for spending. If anyone has any advice for that I am also all ears.

Thank you all and I hope you are enjoying your Christmas holidays!

ManyWays

Well done on getting a new job so soon!

The government has promised a consultation on a review of LISAs in early 2026. There is speculation that the 450k limit may be changed or a new form of ISA may be introduced. You could perhaps wait until late 2026 to decide whether to open a LISA, and until then look at a normal ISA or a regular saver to put money aside each month and then move it all into LISAs or anything that repalaces them 

Troublesum1

ManyWays said:

Well done on getting a new job so soon!

The government has promised a consultation on a review of LISAs in early 2026. There is speculation that the 450k limit may be changed or a new form of ISA may be introduced. You could perhaps wait until late 2026 to decide whether to open a LISA, and until then look at a normal ISA or a regular saver to put money aside each month and then move it all into LISAs or anything that repalaces them 

Thanks a lot! Would it be worth putting a £1 in a LISA now just to get the timer started?

The other idea I’m flirting with but I don’t really like the idea of it, is not paying the lower interest (~11%) loan I have which is worth £10k and looking at using that + ~£5k I imagine we can save in 2026 to go into the market and just get on the ladder.. again, not a fan of this idea but curious to know people’s thoughts

RAS

I think in the very short term, you need to keep a small cushion from the VR until you have some savings. Otherwise, one car break-down or a rental move could lead to new card debt.

You both need to really knuckle down on spends. We don't know where you money is going but you need to work together to get that sorted. If you are both serious about home buying then on your income you can save a lot more than 5k per annum. 

It means sacrifices. Whether that is holidays, ents, eating out, clothes, things for the child, whatever, you both need to cut back.

Not saying you can't spend on any of these, but if you're attending a couple of expensive weddings, consider a much cheaper holiday, etc.

And if you go over the last 6 month's spends you can see where you can save. Kid's clothes bundles or chazzers instead of an item every supermarket trip? Be prepared to argue and to compromise. 

Troublesum1

RAS said:

I think in the very short term, you need to keep a small cushion from the VR until you have some savings. Otherwise, one car break-down or a rental move could lead to new card debt.

You both need to really knuckle down on spends. We don't know where you money is going but you need to work together to get that sorted. If you are both serious about home buying then on your income you can save a lot more than 5k per annum. 

It means sacrifices. Whether that is holidays, ents, eating out, clothes, things for the child, whatever, you both need to cut back.

Not saying you can't spend on any of these, but if you're attending a couple of expensive weddings, consider a much cheaper holiday, etc.

And if you go over the last 6 month's spends you can see where you can save. Kid's clothes bundles or chazzers instead of an item every supermarket trip? Be prepared to argue and to compromise. 

Thanks for the reply. Sorry, to clarify, what do you mean by keep a small buffer? The VR essentially is equivalent to the debt I have so are you suggesting I don’t clear all the debt and keep some of the VR?

To your other points, yes it’s the holidays (better described as friend/family obligations) that are going to kill next year. My wife is from the states and her close cousin is getting married so we have to budget for that. My mother is turning 60 and the whole family wants to go on holiday for that and then my close friend is getting married and there’s a fairly expensive stag do that is being planned for that (I’m doing my best to push back on with the best man). Outside of those, we have no intention of going on holiday.

My goal with all of that is £8k saving next year but I’m saying £5k as a minimum. 2027 will hopefully be a much better year for saving

RAS

I understand the commitment problems and there's nothing you can do to change that, but going forward it may mean that you start letting people know that you are not as flush as they imagine and that you are now saving to get a house as a priority. 

I'd add that if you want a second child, you need a dedicated fund to cover that as well. Essentially enough to cover a year's salary for your wife. Even if she's got good maternity rights, it's unlikely to cover a full year's maternity leave and there will be high cost child care when she does return for work.

It may be that her entire income is taken up by child care costs, but longer term its worth working because of the income once child care costs reduce.

Mortgages at 95% are more expensive than those at 10% and you need £5-7k for searches, fees and registration, plus SDLT. SDLT relief for first time buyers doesn't currently apply for properties over £500k, and is partial over £300k.

Meantime, any of the other stags who might help the best man row back on costs?

And maybe introduce your wife to Dave Ramsay? It may also be useful as a reminder that in much of the US housing is much lower in price, given the climate, even if it's sometimes less resilient.

katsu

How is it going making plans with your wife now? It seems like she's getting more engaged and if she wants the house as well as the wedding, can you both agree what you'll save and to maybe make other cutbacks?