help me with a difficult choice please

cobbingstones

Hi all

We are currently living in a wonderful house where we are very very happy. But, we are totally skint. Our circumstances will not change until the winter/new year but even then we would still be struggling. Our fault for being so bad with money.

My dh wants us to sell up and move into rented which we have never lived in before. An EA gave us a selling price of £400,000. We would then have money to make ourselves debt free, pay the redemsion (10k) and other costs involved and have approx £60k left over. He then wants to bank this and in a couple of years or so have a good deposit for another house.

I really am unsure. I love where we live and I know we are struggling so much. We have £65 to last us a month. We are only surviving due to selling a car for a cheaper model. I guess I'm worried about living in rented and also about not wanting to make a huge mistake.

So would you stay and stick it out until things became better in the New Year (hopefully) or move into rented and have a life?

Thank you for reading.

MM

Gonzo

I would say, probably, on what you've said, yes!

You need to learn how to cut your spending (if you haven't already) otherwise that 60k would be gone pretty quick too. Make sue you can't touch it!

Go on the Debt Free boards on here, they could make a real difference to your lifestyle, and it might surprise you where you're going wrong. It always helps to have a different pair of eyes looking at your outgoings etc.

From personal experience, being debt free is such a weight off your shoulders, you wouldn't believe. Your whole life seems to lighten up!

Try to add to the deposit money, and maybe have a smaller mortgage / house next time which better fits your financial reality. Good luck, but selling seems a good idea in my book, unless you absolutely have to stay, but if something bad happens, you could lose everything? Regroup and come back stronger!

msmicawber

A good place to start might be to compare how much you pay each month for your mortgage and how much it would cost to rent somewhere that you would like. I rent as I have no choice and pay a lot more in rent than any of my friends pay on their mortgages.

JimmyTheWig

I'd say don't do it.
Is there _any_ way you can bring more money in / spend less. The thing that springs to mind for you is to take in a lodger.

Two things worry me about your husband's plan.
1. Paying 10k redemption (on top of other fees) is hitting your equity hard. House prices will _probably_ come down in the next couple of years, but not necessarily enough to make this worth it. What if house prices don't come down. Or if they go up? Are you tied to a particular area? If so, prices in that area might go up even if prices nationally take a tumble.

2. You admit to "being so bad with money". Have you both changed these habits? Really? Do you _honestly_ believe that you are both now good with money? If not, what's going to happen if you've got 60 grand in the bank? How about 5k to replace that car you sold? And it's about time you had a holiday, isn't it? And the TV's looking a bit dated. And...
My concern is that with the money there in the bank there will always be a temptation to spend it.


If you can see better times ahead in the new year then I'd say if you can possibly cope then stay where you are. If it means bar work / pizza delivery / whatever in the evenings then so be it. It's for less than a year. If it means cutting back on absolutely everything you spend - surely that's better than having to move? If it means eBaying your CD collection, who cares.

Good luck with it. I think this site covers just about every area of spending. Don't assume that anything you spend your money on is good value. Take the time to research it and you can probably save a fair bit.

fc123

madsmum wrote: »

Hi all

We are currently living in a wonderful house where we are very very happy. But, we are totally skint. Our circumstances will not change until the winter/new year but even then we would still be struggling. Our fault for being so bad with money.



So would you stay and stick it out until things became better in the New Year (hopefully) or move into rented and have a life?

Thank you for reading.

MM

Hopefully? You either have to cut back further or 'Make more Money' pref do both.
Hopefully is a bit vague as things may not improve. Things could get worse?

As you haven't posted more of your financial situation, it's hard to comment but 'Having a Life' How do you define that?
If you mean spare cash to go out, have hols etc then that is a lifestyle choice you have to make,. Instead, you have a house you love.

Ideally having both is more fun but that's life.

We chose to have a house and pay for schools so didn't have hols, nice stuff etc but we still 'Had a life'....just not the one others have.

FWIW we rent as re-located and rent out family home....it's OK but not great.

Nomad25

I'm with Jimmy on this, that would be my comment too.

spirit

Is it possible that you could up your income by say letting a room to a lodger? You get your tax free allowance under the rent-a-room scheme from the Revenue? Are there other ways you can increase your income by taking on extra work too?

SouthCoast

Why are you a debt slave?

Add up how much interest you have paid to lenders in the last year.

http://www.adviceguide.org.uk/index/life/debt.htm

jamtart6

If your house is worth £400k I would probably sell and downsize! Depends how much your debts are though? Can you buy a house for £150k and pay off your debts with the other £250k?

margaretclare

SouthCoast wrote: »

Why are you a debt slave?

Add up how much interest you have paid to lenders in the last year.

http://www.adviceguide.org.uk/index/life/debt.htm

This is very valuable advice.

If I had all the interest that I've paid over the years, car loans, loads of other forms of debt over many years, I'd be one heck of a lot better off today. One year in particular I paid over £700 alone in late payment charges, overdraft charges and bounced direct debits. That's just one example. DH, by contrast, has never had a late payment in his life. I've learned a lot from him.

Being bad with money is not an irreversible condition. Start to learn, and start today! Sit down with Martin's budget calculator and work out your basic budget. Today is the first day of the rest of your life.

Good luck!

christabell

Quote:
Originally Posted by SouthCoast

Being bad with money is not an irreversible condition. Start to learn, and start today! Sit down with Martin's budget calculator and work out your basic budget. Today is the first day of the rest of your life.

Good luck!

I totally agree , start a budget, stick to it, check for the cheapest broadband,electricity,gas,phone,food etc. If you love your house so much ( and it sounds to me as if you do) MUST DO IS A GREAT TASKMASTER