Just opened our credit card statement

[Mooycow]

And am so shocked , it’s over 25.000, ! My husband deals with all the bills ( I do everything else) ,he gets online billing and tears up the statement when it arrives , we have together spent the money ,it’s all way too easy ,obs, AIBU to be shocked that we owe that amount .

Time to get very, very wise to your budgeting. You clearly can't leave your DH in charge without imperilling your whole future. You need a budget- one that will allow you to repay this huge amount of money, while making sure that you are living within your means in the interim. Unless you're very high earners, you're likely to experience straitened circumstances for 5-10 years to get straight after this.

I'm sorry, there's no other way of doing this than being brutally honest with yourselves about how you got into this mess.

Of course she isn't the norm putyour

So do you have the means to drastically reduce this debt or will this take a great strain on your finances?

not the norm, but not the exception either. It's not at all unusual for people to be in debt (aside from mortgages, not many of us are entirely debt free if you include your home)

OP, if this is a genuine thread then you should be embarrassed for not taking more of an interest in your own finances.

My card limit is £5000 per month. I don’t know how and I never go anywhere near that.

My January bill was just over £500 and I was panicking. And £350 was money my dad owed me because I bought my mum’s Christmas present for him so she wouldn’t see it on their bill before Christmas. So I only owed about £200. I still paid it off in full and just cut back on some other stuff to do so.

I try to use my card for like 2 or 3 small things a month to build up my credit rating and I always pay it off in full.

OP, you need to sit down with your DP and have serious chats about how you are going to clear this debt.

£25,000 over 5 years is £5,000 a year (about £100 a week) that you are overspending OP. If you continue to live like this, the debt will continue to rise.

You now need to start underspending each week and start paying off this huge debt.

My biggest worry would be that he has more cards and is using one to pay off another, etc.

Yes you need a big talk and he will have to be completely honest with you.

The amount that think it's the norm and perfectly ok is worrying.

It's not the norm for most people and amounts like that are usually on mortgages etc, not shopping on credit cards. I wouldn't be able to sleep with that kind of debt and would be working all hours and eating the bar every minimum to clear it.

Far too many want lifestyle beyond their needs. I've seen many things on here described as essentials when they are all luxuries. Nobody needs the internet, holidays etc.

Fuck me. I'm having sleepless nights about the £4K on mine.

My MIL spends before she earns. She puts her annual holiday on her card, including clothes and spending money, and then spends the rest of the year paying it off. She moans about it all year, how she never has any spare cash because she has to pay the debt (for a holiday long forgotten).

I suggested that if she skipped the holiday one year, went away in the UK to a cheaper place or just relaxed at home, she could reverse this and SAVE that year for the following year's holiday. She looked at me as if I was mad because, as she said, "but they are letting me have the money now!"

It's a different way of thinking. Earn now spend later, or beg for money now and have to pay it off later.

Sorry but you are equally responsible here. You must have had some idea that it wasn’t being paid off in full every month. Didn’t you realise you were both spending far above what you earn? Wilful ignorance is no defence.

The most worrying thing in all of this for me is not the debt, but the fact that you didn’t know. How much was being spent, how much is being paid off each month, how much you owe. If the card is in joint names, it’s a joint responsibility and it’s in your interest to know about it.

I deal with all the finances in our house but DH knows where we are with everything because joint finances should be transparent. I agree with what you said, you guys need to sit down and talk about this. Who knows, he may have a reason for keeping the balance on there, maybe he’s waiting for an investment to mature and then pay it off, I dunno. But whatever you need to get familiar with your joint finances for your own peace of mind.

I'm scared about the £900 I owe on cards.

£25,000 was my entire debt for 2 degrees & a post grad diploma.

Contact credit card company and offer a repayment plan, ask them to stop adding interest.
They will cancel the card. It will affect your credit rating till you pay it off.
Sorted. Be more careful in future. When you have paid it off use the spare money to save up for bathroom tiles etc. Good luck.

It’s not your annual statement is it?

We get one a year showing the total spend for the year.

Fairenuff
No it isn’t an overspend by £100 a week. A massive chunk of the 25k will be accrued interest. Did you look at *billybagpusses” calculations? 25k repaid over approx 4 years at 18.9% apr gives an interest payment of 16k.

Thank you billy for illustrating why adding to the mortgage perhaps isn’t a bad idea. The only caveat is that op would potentially have to remortgage to do this and a) this would cost possibly 1k to do so and b) mortgage companies only generally allow a 10% overpayment during the fixed rate period. It would, however, be possible to overpay the maximum and save the remainder to be transferred at the end of the fixed rate.

Moody
A zero rate credit card would be my first option if you and your dh are disciplined enough to pay off the debt. I’m not so sure this is best for you though. This obviously costs maybe 1.5% to balance transfer. Idk what the rates are having not had one for a long time.

Getting a personal loan may be a safer option even if it costs more as you will be forced to meet the payments. You can also overpay at any time.

Adding to the mortgage/remortgaging if you have a good chunk of equity is also a far better options than the credit card right now. But again, you needs the discipline to pay it off early. And ensure if you were to remortgage you wouldn’t overpay too much that you’d be liable to repay the entire early repayment penalty, which is often around 3% of the total debt for the first year, which would be thousands.

I would see about taking out a loan to cover the card. The interest would be a fraction.

£25k is just too much on a credit card, I think you already know that.

Would be good to sit down with your husband and:

1. Find our if he has any more hidden debt. If you can hide £25k, there could be more.

2. Go onto the credit card online banking. You can then normally download all your transactions to a spreadsheet over the years. You'll probably find that the 25k is due to general overspending on little things rather than big lumps like tiles.

If you're both earning, you should be able to sort it out and likely never do it again.

Credit cards are great for lots of things, but NOT for borrowing money!!

Hi there @Mooycow
I am not in the least bit surprised that you have a huge card limit - I'll bet the actual limit is rather higher than that
if you have been servicing and adding to the debt for years.
The card company are making a fortune out of you.

You need to get it under control.
Pop over to the Money Matters board and join one of the debt threads
we will give you non judgey ways to chat to your DH and sort out the card balance
there are really easy ways to clear that debt in a lot less time than you took to accrue it.

"Today 07:34 Shimmershimmerandshine

It sounds like you are living beyond your means OP. Tbh I'm surprised by the shock on the thread I think a lot of people do when you look at the cars they drive round in etc. You need to pay it off, insist on full access to finances and start going on cheaper holidays."

Or... no holidays. Seriously. If you're £25k in debt on a CC you cannot afford holidays however cheap. Or luxuries. You're sitting on a ticking time bomb.

To PP saying they feel better about their £4K debt, be careful, maybe you're being light hearted but that's a dangerous attitude to have, and one I had which contributed to me getting deeper and deeper in debt. I worked in a bank and regularly saw people in tens of thousands of debt, it was easy to bury my head in the sand and think 'it's only £2k mine, phew' and increase that amount until I was £8k in debt and had no choice but to go bankrupt with a DRO.

Any amount of debt you cannot immediately pay off (its fine to carry a small balance on a CC you pay off in full monthly as long as the money is there to pay off at any time) are dangerous and should be attacked with all of your energy to reduce and get rid of.

It's been five years since my DRO and I've been debt free since and now save money, I was horrified recently to find out of my friendship group of well paid professionals, all three of the ones I was with have £5-9k debt in loans and CC. They didn't see it as a problem. One went on an all singing all dancing trip to New York and openly admitted it was all on the credit card adding to her balance. I couldn't sleep at night when I was in that amount of debt. They see it as normal like I used to. Now if I knew I was so many thousands or hundreds below zero before I even broke even I wouldn't be able to live with myself.

Do you know (I apologise if this is up already and I missed it I have rtt) it would take approximately 44 years to pay off a 25k credit card paying monthly minimum. I would be sitting crying somewhere and feeling sick if I had opened that and I think I could afford the minimum payments. That is not good. Also if you have joint bills you should really discuss jointly.

Go over to the frugal threads OP and workout how to drastically cut your outgoings.
get as much of your debt transferred to a 0% card as you can but try not to send up red flags on your credit rating.
Meanwhile: use the money you are saving by living frugally to make sure that every month you pay off: anything you have bought on the credit card, PLUS any interest accrued that month PLUS 10% of the balance overall. You'll be looking at 2.5K a month approx. (or a little over). If you don't have this available then look to pay off interest +purchases + 5%...but decide on a realistic but challenging %age and do not allow yourselves to let this drop any lower under any circumstances. By being careful you can slash your outgoings for a year.

it would take approximately 44 years to pay off a 25k credit card paying monthly minimum.
Nope.
Repayment term is independent of amount borrowed
it is entirely dependent on the interest rate
£1000 takes the same amount of time to clear as £25000
see the full spreadsheet here

And be careful about joint finances, is the mortgage up to date?
Whose credit card is it? they are liable.

If you can get some or all of it on 0 percent that would be best if not a loan or equity in the house is your best bet it will be very tough to clear that amount left on a card.