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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

To be worried about this level of debt

80 replies

Mammabee20 · 27/04/2020 22:27

Hi! I am just wanting some advice on whether this level of debt is something to worry about or not.

I am currently on maternity with DC 2 and DH is working from home due to COVID-19 so our wages haven’t changed at all. I know we should be lucky and feel grateful about this but I am really panicking.

I have totalled all of our debt and it comes to £17500! That is not including any money we owe family from previous borrowing. We are supposed to be paying my dad back by my DH using his skills to assist with my dads business. We have promised to build and maintain it for 5 years before we start charging.

Looking at all the avenues I cannot afford to not go back to work and full time at that but our outgoings means we can only afford childcare for 2/3 days.

I have done an extensive spreadsheet on Microsoft and the only way it looks like we would be able to clear the debt quickly would be if I returned to work full time for a year and family looked after our children for free for 12 months. My whole wage would go on clearing the debt and nothing else. This Avenue is completely pointless though because it would be highly inappropriate and cheeky to ask family to ask them to look after them for free for 5 days a week with nothing in return..

I hate this I feel sick to my stomach whenever I think of money and my DH is just oblivious even though I’ve told him the figure and I’ve given him the worst case scenario figure which would be including borrowed money from his dad.

For reference our take home is about £2800 and our debts and mortgage payment together is about £1000

So my AIBU is.... am I being unreasonable to be worried about that level of debt or not?

OP posts:
wickedgames · 27/04/2020 22:29

Why do you need to clear it quickly?

Redlocks28 · 27/04/2020 22:31

That sounds a huge amount of debt to me. We have a mortgage (8y to go) and a credit card which we use for store points and pay the full amount off each month.

What is the debt for? How much is it including what you owe to family?

YANBU to be worried, but why are you suddenly worried now?

Pinkyponker · 27/04/2020 22:32

Is that including your mortgage..?

Tinyhumansurvivalist · 27/04/2020 22:33

So you have £1800/month to spend on food, travel etc... That is a HUGE amount of disposal income... That is more than I earn a month and I work full time.

You cam afford to pay off more than the £1000 a month you are currently paying

Pinkyponker · 27/04/2020 22:34

Ignore above... My mind added an extra zero Blush

Lazypuppy · 27/04/2020 22:34

Yes why do you need to clear it quickly.

Just keep chipping away, then when nursery fees reduce use that towards the debt to pay more off

abstractprojection · 27/04/2020 22:34

You debt repayment and mortgage seem affordable against your income. So take a deep breath that the balliaf is not about to appear at the door.

But I personally think that any personal debt is too much, shouldn’t be raked up in the first place and when it has to be paid off as quickly as possible.

Paying off debt is a journey and it’s important that you are both committed to it, overwise spending will just rise with any increase of income or credit, or you’ll pay it off and then get back into again like a yo-yo diet.

Original poster
Mammabee20 · 27/04/2020 22:34

We’ll be paying it for 5/6 years and we want to move before the kids start school. The biggest problem of all though is that we cannot afford childcare full time but with the outgoings being what they are we cannot afford me to not return full time. We’d be left with nothing if I went back part time and carried on paying the tiny amounts we are paying now.

The other issue is that my work pays 50% of wages for 6 months and then it is SMP and then nothing.. we cannot afford the outgoings for these months but our little boy was born premature so I don’t want to go back before a year as I want to make sure he is okay Sad

I feel very upset as it is all fault or it feels that way. I was supposed to be in charge of the household budgeting but with me being on maternity last year and being unwell with gallstones and then being pregnant again and everything borrowing has escalated.

I don’t know whether to apply for a DRO but I am worried we could lose the house as a result Sad

OP posts:
Teabaseddiet · 27/04/2020 22:34

Don't forget the tax free childcare arrangement that will cover 20% of your nursery fees

absolutezero0k · 27/04/2020 22:37

It depends on so many things. This would be a large amount for my family circumstances bit not for others.

Take a look at the debt free wannabe section of the money saving expert website, lots of fantastic advice on there.

Espoleta · 27/04/2020 22:38

That sounds like a lot of debt
Have you contacted a debt charity to see if you can consolidate it?

absolutezero0k · 27/04/2020 22:39

Sorry that should say forum not website.

forums.moneysavingexpert.com/categories/debt-free-wannabe

Rubiales678 · 27/04/2020 22:42

Are you paying high interest on the debt? Shift it to 0% if you can? Or at least some of it. Is requesting a mortgage holiday an option whilst you are on mat leave? I'm thinking of trying this towards the end to take longer than 6 months.

Original poster
Mammabee20 · 27/04/2020 22:42

The debt has escalated with moving into our first home, having first child etc.

Basically our mortgage is £437 a month & our debt repayments are £405, our childcare fees will be about £700 for a nanny to look after the children 3 days a week. The issue with that is if I go back part time we wouldn’t be able to cover all that or I go back full time and we need to cover another 2 days childcare for free otherwise we wouldn’t be able to afford it.

The debt is about £25000 in total after what we owe family, £17500 personal debt and we owe my dad £2000 and his dad has given us about £5000 over the last few months. He gifted us £11000 for our deposit which I feel so uncomfortable about

I feel like if we were honest with family about how bad it is they would be appalled and his dad would think I’ve ruined his sons life even though we’ve both racked it up Sad😭

OP posts:
Hunnybears · 27/04/2020 22:46

So once you’ve got your bills paid etc you have £1800 a month? If you were really good you could spend say £250 on food then save £1550 to pay off your debts most months?

I’m sure you’d get childcare costs from the government to help you with childcare as £2800 between the two of you working isn’t mega bucks so surely you’d be entitled to something?

Original poster
Mammabee20 · 27/04/2020 22:47

We did get approved for a loan covering the majority of the payments but it is basically the same monthly payment wise and it was 6 years where as if we hit the ground running with paying it back in larger amounts we could have it cleared sooner.

A couple of the loans I intend to have cleared by the time I go back to work hopefully Sad

OP posts:
Original poster
Mammabee20 · 27/04/2020 22:49

The breakdown is our household bills come to about £700/£800 depending on what the gas & electricity bill is. Food is £200, travel and car running costs is £260, debt is £420, childcare costs will be about £500/£700 depending on how many days we need her. The rest goes on supplies for the kids etc

OP posts:
Hollyhobbi · 27/04/2020 22:54

Why do you need a nanny? Is there no cheaper childcare options? Why do you need to move house? You already had to borrow for the deposit for your first house.

Original poster
Mammabee20 · 27/04/2020 23:00

We don’t need a nanny but two children in nursery or any other establishment has shown to be more expensive than a nanny looking after both children for 7 hours for 2-3 days.

Our daughter doesn’t turn 3 till October 2021 so we wouldn’t be entitled to the free hours till January 2022 and the tax free childcare wouldn’t help with 2 childcare costs full time.

DH has a good job with a degree and he has been in a specialist version of that role for 3 years with no pay rise so he is starting to look for something better so that might help. I am just panicking about what to do before that.

I want to move but I know it is not even a consideration right now so that’s not the reason for wanting to clear the debts.. it’s the fact that I hate debt and for the level we have we’ve got nothing to show for it Sad

OP posts:
Original poster
Mammabee20 · 27/04/2020 23:03

@Hollyhobbi- the deposit wasn’t actually borrowed. My DH’s dad gave it to us as we had found out about the baby and we needed to move from a 1 bed rental. DH’s mother has passed away and his dad said if he ever needed anything money wise to not hesitate to ask.. obviously I am not thinking that it is a green light to ask.

I want to include anything we’ve borrowed of his dad and pay it all back but DH thinks that would be an unpayable amount & his dad wouldn’t accept it

OP posts:
MamaGee09 · 27/04/2020 23:03

Could you change jobs so that you are working different hours from your dh, meaning you have no childcare costs?

This is what we did, dh worked days and I did 2/3 evenings . Most of my friends have changed jobs so that they work opposite shifts meaning no child care costs.

ECBC · 27/04/2020 23:05

It sounds like you are putting a lot of pressure on yourselves to clear this debt ASAP. I can understand it but when you had DC2 you must have known how much the childcare was going to cost based on your experience with DC1? What’s changed now that has made you so concerned? If you can’t afford larger repayments you’d be better off sticking in your current house until you’re in a better position financially.

Saladmakesmesad · 27/04/2020 23:06

Our debt repayments are £405

This means you're not on 0% interest. Can you switch it all to a 0% credit card, or at least a lot of it? You have to pay 1% balance so that would be £175 based on what you've said. Then use literally every spare penny to pay off the debt. Switch it to another 0% card at the end of the term though or it goes way up. Do little things like sell things or do small jobs and keep chipping away at it. It will come down. Don't panic but don't ignore it either.

snappychat · 27/04/2020 23:07

Could you get a loan through your mortgage company for the debt amount, pay your debts off then the repayments for your loan will be spread over the remainder of your mortgage term, say 20 years, they will be lower repayments then?

Mumoftwoyoungkids · 27/04/2020 23:07

If you need to work full time then why are you only costing 2 or 3 days a week of childcare? Who is going to look after your children the other 2 / 3 days a week?

Are you sure the nanny is cheaper than nursery or a childminder? Nannies come with a lot of hidden costs - food, activities, tax etc. And I’m not sure that you can use the tax free payments for them.

Have you been through all your bank statements to work out exactly where your money is going at the moment? You have debt of £25k plus a gift of £11k - it must have gone somewhere?

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