Am I kidding myself with finances

[Timeforchangeornot]

Need a reality check and don't feel like I can ask ppl in irl.
In summary,
Have a mortgage of £220k (equity £200k). Payments £1200pcm
Joint Car loans 33k
Joint Credit card debt (all on 0%) 30k
Joint Income 98k

The credit card debt is the bit that's bothering me despite being on 0%. We have deliberately made some family decisions which has created this debt. However are we kidding ourselves that this level of debt is manageable?
Long term plan (within the next 5years) to move and release the equity in house.

Just wondering what others think?

Have you both just had pay rises? Or even bonuses?

Do you claim any benefits?

Do the teens have jobs? I found them paying for their own entertainment and pizza saved me a fortune.

Are to time poor? I find this makes a difference!! Do you look for money off coupons, sales, plan ahead?

There’s no way you should be this broke.

Do either of you have the potential to earn more and climb the career ladder as your DC are older now. I’d be keen to pay off the debt. As it’s proportionately very high as others have said.

Def need to payoff the cars or take the penalty and get rid of. Create a payment plan with ChatGPT

Hi op just a watch out but if you were not able to shift the credit cards onto new 0% deals at any point and you are only making minimum payments you could be flagged for persistent debt. This would mean an agreed paydown plan at a higher amount than your minimum payment and a possible credit suspension on your account. It wouldn’t affect your credit rating but can still be tricky to explain during potential remortgage.
As everyone has said, I would either pay off the debt or get a loan to structure the repayment.

So Disney and an extension.

Wouldnt you be better off getting a ‘bigger older car for a much smaller amount.
Cars are after all a depreciating asset and a lease car that is small and fuel efficient for the commute.

One day you’ll die. Quit worrying.

You have to LIVE in the equity, how do you think you get to spend it unless you take on more debt?

So unhelpful. She’s looking for advice not snarky comments. How are people supposed to learn and educate themselves if you attack them for asking the questions? She’s even responded gracefully with thanks despite a tonne of these completely unhelpful responses. It’s supposed to be a supportive community.

I'd suggest speaking with a mortgage broker and rolling the car loans into you mortgage. The funds you free up doing that can be redirected to your credit card debt.

Facing up to the financial challenge is the first step. Well done.

Living on white good failure (or car) or job loss away from needing to borrow more money is extremely stressful and not good for a marriage. I've found the money app YNAB has really helped me think about money in terms of what jobs do I need it to do and how to prioritise the cashflow as well. Check out the YNAB subreddit to get a flavour of how it might help you as you figure out how you want to manage the next bit. It's helping me keep on top of the minutiae of our finances, something I always found difficult in the past.

But its more than 1 car? When you say car loans 33k have you just got them or was it more than 33k?

Have either you or DH considered a second job? Working evenings or weekends. Would boost your income and could be used solely for increasing your debt repayments. I get no one wants a second job but 30k on credit cards alone is going to compromise your lifestyle for so long it might be worth it.

Just a thought you could try, I’ve spent the evening inputting all my budget and financial goals into chat gpt and it’s made me a plan to reach all my goals in a month by month stepped process.

I think you’re in for a shock with regards to university. The loans do not cover accommodation and living expenses - accommodation can be up to £10k alone in some places. You will need to subsidise your DCs substantially with that income. You need to factor that into your financial planning for the coming years.

I’ve been in this situation, moneys ok and you think I can afford the repayments and suddenly you’ve snowballed and you’re barely managing. When you are in this situation I guarantee your debt will only grow. You have no spare money for emergencies so you will always be relying on taking out more debt when you need something.

You all need a side hustle. Kids can get paper rounds/waiting jobs depending on age. If they have their own pocket money you can cut back on that. You and your DP need to be looking for some extra earning opportunities. If you can do that for a year and pay off one of your credit cards then your monthly payments can go down and you have a bit more flexibility each month to increase your payments. Realistically it’s going to take you years to pay off those credit cards but you shouldn’t just plan to sell your house to release equity because it’s a huge debt burden to be carrying and if you don’t do something about it now I should imagine it’ll grow

But are you not actually paying off any of the debt? Can you not find some more every month, put £100 aside and put the rest on the debt?

I think many MNrs have little clue about creating wealth - I'm late to the table too.

Debt is fine if you have reliable income. Paying off debt is not always the best thing to do with your money - an extra £100 pcm off your mortgage might save you a few grand, but put into a pension that's invested in say a good S&P will create at least 10 x that amount of money. I saw a reel where a guy was saying they had $1b in debt because they had purchased x properties, but that debt made them nearly $200k pcm in rental income...

I dont know your full outgoings, but I'd suggest seeking investment in something that creates additional income eg hands off properly investment with yields upwards of 11%. You can use this income to pay off your debt without touching your capital.

Your property provides you with some safeguard because of the equity you have so yiyr current position is probably balanced. Lose your job and things could be trickier...

I'd take some advice from a good financial advisor, they'll help you restructure everything.

They have £30 spare a month. Not sure what she can invest that in to generate enough income to pay off £60k

You are in far far too much debt. I don't know how you sleep at night. Just why?

What cars Are you driving? Are they on the monthly payment as the interest is insane, you may be better off getting a bank loan and buying 2 cars?

This is a good idea, remember your kids will want driving lessons if you live in the back end of nowhere, so getting them used to the idea that cheaper cars are ok is a good idea.

Driving lessons and kids insurance! Eek.

And the tax on that £200 k will knock the return way down, not to mention capital gains tax when they sell, landlords insurance, decorating and maintenance…

My first impression is that this is unmanageable and that your debt is just going to snowball because you’re making the minimum payment.

I think you need to sit down and use your net salaries, and see what £ you have left over a month after all key bills and expenses. See if you can cut back in anyway to increase your Cc payments.

Something that annoys me about this country is that because of the deeply ingrained class structure, none of us want to talk about money so no one really knows what is acceptable spending unless you’re privileged enough to have a financial advisor. Well done for speaking about this, this is the first step to sorting this out xxx

Where do you think your kids will go OP

If you are thinking University then you may get a shock as Uni maintenance barely covers rent and they won’t get the full maintenance on your income anyway.
So more expense for you