Am I right in thinking that we don’t have too much to worry about?

[Baconfryz]

Hi,

we managed to get on the property ladder in 2021 after years of renting. We’ve done some work on the house and we do have some unsecured debts that we are also clearing.

dh is worried about money and thinks that money is ‘tight’ but I disagree. We’ve drawn up a budget and after all bills, debt payments and food/fuel, we are left with just under £950. This month we have used £300 to overpay a debt, £300 saved and £350 as ‘fun’ money. I think that this this is actually quite a lucky position for us to be in at this stage in our lives. Mortgage is fixed until 2028 at which point the other debts will be gone. No childcare fees anymore 😀

am I deluding myself, or is dh over- worrying?

Your £25k of debt is fairly significant. I would be focusing on paying that off primarily. Then think about overpaying the mortgage while you're still on a lower rate and upping pension/other investments.

But the debt has to go first. You are losing more on the debt than you're making on the cash savings.

You could overpay by much more.

I think your debt is pretty high and should be prioritised.

All I can say OP is that you are doing better than we were at the same stage in our married life.

I’m not sure I’d say you’re deluding yourself but that’s quite low savings, so I’m with your DH. Do you have a savings goal besides having £5000 in emergency savings? It’s not an amount I’d be comfortable with, tbh.

I think you are doing brilliantly. Having some debt is not uncommon and whilst it’s significant, 25k is not uncommon n this day and age.

As someone who is a bit older I’d say that you are doing very well. You’re keeping up with your commitments and having a bit of money for fun.

just keep going and before you know it you’ll be in an even better position

I have to agree with your husband, 25k of unsecured debt ON TOP OF a mortgage, at your ages, is a lot of debt and I would also be feeling stressed about that. I wouldn’t consider myself to have any “spare” money with that hanging over me.

Would you feel the same about a big mortgage?

Unsecured debt is fundamentally different to secured debt, there's good reason to think about them differently

I'm with your DH. I wouldn't be feeling fortunate with a £25k debt and £3.5k savings.

From your opening post, I thought you were doing grand, but when you have later added you have £25 000 of unsecured debt, I'm now with your dh.

I would be aiming to use £900 of that £950 to pay down debt each month, and I'd be looking at how I could earn some extra through a second job, to increase those payments even more.

As others have said, a mortgage is vastly different as it is a secured loan.

You have one of those and you ALSO have 25k unsecured debt.

In your shoes I wouldn’t consider myself to have any spare money, every “spare” penny would be going towards my debt and I can see why your husband feels stressed about that.

Slightly different take from me.

You are 35, you own your own home and you seem to have a happy family life. I think you are doing well. Of course, it'll be better when the 25K has gone, however you are one of many millions and millions of people who have unsecured debt. it's clearly manageable and you will be free of it in 4 years. Doesn't sound too bad to me.

Remember that there are some VERY debt averse people on MN