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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

to cash in my childrens savings plans?

237 replies

kaz33 · 04/09/2009 14:36

We are in debt, for several years since the boys were born (8,6) we have been struggling with debt. I gave up my lucrative job and we bought a house we could not afford (only three beds but nice area)

DH just got a £20K bonus, and have just paid off over £10k. We are roughly £30k in debt but finally we are earning enough to maintain our comfortable but not totally extravagant lifestyle.

The boys have got about £7.5k in their savings plan I want to cash them in and pay off some more of our debt.

Is this totally immoral ? What would you do?

I'm not scared of harsh words

OP posts:
MrsHappy · 04/09/2009 18:18

In your shoes I would:

  • take the children's savings (if I could and they were not in a CTF) on the strict understanding that, say, half of the money we saved by paying down debt would be set aside for the kids/more financial cushion (and the rest of the savings used to pay down debt).
  • look at trading in cars for cheaper models (i.e. no finance and lower insurance costs).
  • make paying down debt a priority. I bet you can find a way to get rid of £10k in the next year, and that way you will be a lot better off next year.
  • research whether I could get a cheaper mortgage or go on interest only for a while. Mortgages tend to be a comparatively cheap form of debt so using money you save on mortgage repayments to repay unsecured debt might be a smart move.
  • look into working a bit more/somewhere with higher pay. With both kids at school would that be possible?

If you swallow a few hard years now and get yourselves straight you'll free yourselves up for a more extravagent lifestyle afterwards! And seriously, I bet you could get rid of the debt in 3-4 years.

nikki1978 · 04/09/2009 18:20

I don't think you are being unreasonable if you paid the money in to the savings accounts and you plan to give it back when you are out of debt.

Just wanted to say I know how you feel with the debts though. DH was in debt to the tune of £37,000 when we first started dating years ago and since then it went down then up again then down again then up again! DH is frankly shit with money and always wants the new and best stuff (yes he can be a child!).

Over the years we have had flat screen tvs, a new very expensive piano, several cameras and lenses etc etc. Plus me not going back to work when we had kids and our recent wedding didn't help! We have had to live with my parents - for 3 years in their hotel in Eastbourne which was hell as we had to work their (never work with family ) and now we live in their house with my brothers and pay a little bit of rent. We are very lucky in that respect but it is hard to be in that situation at 30 and DH regularly feels like a failure for not being able to provide properly for his family.

We are now in £30k of debt - it was nearly 60k at its worst - and have recently followed the advice of a financial advisor friend. Basically we had 4 loans and 4 credit cards paying varying extortionate levels of interest on each. DHs Dad has loads of savings and the savings interest rates being what they are at the moment we made him an offer that we would borrow 30k from him to pay off our debts then repay him at £800 a month with a 4 and a half % interest rate which is less than we were paying but more than he can get anywhere.

It will take us 3.5 years then we are done. We live on a tight budget anyway - I have a spreadsheet each month to tally up how much is coming in (wages, CTC, CB etc) then budget for loan payment, food, bills etc and whatever is left is split into 4 and that is our weekly budget for going out, clothes etc. It works very well and helps you see when you are spending too much on silly stuff.

If DH asks now for anything he really doesn't need I just say no as I can see a light at the end of the tunnel and I bloody well want to get there!

vinblanc · 04/09/2009 18:23

I think the advice about changing your cars is poor advice.

The cheapest cars are the ones you already own. You always lose money when you sell you car and buy another.

Original poster
kaz33 · 04/09/2009 18:26

My car is not expensive (3K), and my husband needs a good car for work.

Mortgage comes off fixed rate next year, so might save a few shekels there.

Don't want to work full time, my previous employment is not an option as commercial property solicitors are not in high demand. Think I underestimated my income it is £28K pro rata for three days so about £19 k a year and only been there for a year so no chance of higher paid version.

Have been ebaying like mad £450 sitting in paypal and no non essential standing orders other than Sky and very cheap gym membership (£30 for the two of us).

Its the latte's, days out, haircuts, new school shoes, books, food that just filter the money away.

OP posts:
justabouteatingchocolate · 04/09/2009 18:28

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Original poster
kaz33 · 04/09/2009 18:31

I know, I know, I know but it is so dull.... I know we can do this.

Have to go and play football with youngest who is as he informs me the third best football player at school.

OP posts:
justabouteatingchocolate · 04/09/2009 18:32

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lifeswhatyoumakeit · 04/09/2009 18:32

SouthMum, I am real too. I know of people who came into money they never had to work for, and blew the lot. Children need to learn the value of money, not get handed a nest egg when they're 18 to do as they wish - while parents struggle to make ends meet.

My parents never had any savings for me, but more importantly taught me the value of money. I went to Uni, I've bought every car I ever owned, I paid my own deposit on my house - all with my own money that I earned. Why should parents buy all these things for their children?

pasturesnew · 04/09/2009 18:33

there is also the mumsnet haircut!

lifeswhatyoumakeit · 04/09/2009 18:34

And OP, it sounds like you're making some great changes - good on you!

londonartemis · 04/09/2009 18:35

kaz, just be careful about thinking the future is rosy when it comes to earning...IME children get more and more expensive and work gets more difficult to work around their demands and needs.

(I know you were asking advice about cashing in the children's money (which I have said I don't believe you have a moral right to do. BTW, don't contribute any more ATM!)

But I really think you must be realistic about the financial pressures of the future...mortgage rate rises, school fees/tuition, holidays, house repairs etc etc. Don't just think it'll be alright when the debt is paid off. My DH and I find as life goes on, the finances get more and more squeezed, no matter how we budget. I really advise you to get your spending sorted out asap. If your DH is hard to rein in, it's probably best to do this through a third party like the CAB.
Can understand you not wanting to involve your parents. I think you are right to keep them out of it.

Morloth · 04/09/2009 18:36

I would take all but a 1,000 each from the kids and apply it to the debt. A 1,000 is a pretty awesome 18th present I think.

Then I would cancel Sky and the gym memberships, buy a nespresso machine so I didn't need to buy coffees out and start paying attention. I now don't carry cash. So all those little purchases that just seem to happen, don't anymore.

Just it can be a bit annoying, but I have better things to spend our money on now, than frittering it away on useless junk.

Lizzylou · 04/09/2009 18:36

OK, re: cars, was envisaging a Porsche Cayenne where a VW Polo would suffice (in which case, yes, would be an option to downgrade!).
So yes, just stop the fripperies (I do sympathise, I have always been a massive fritterer and we are on a tight budget atm). Have you tried getting a set amount of cash out for the week and then not touching your debit card at all that week. Something about paying cash always makes me think twice.

I also understand about the market for Com Prop lawyers, are you still practising as a Solicitor?

Original poster
kaz33 · 04/09/2009 18:43

At least you are all being a little bit nicer to me, spoilt little brat that I am. There is lots of other stuff that I could admit to but is too embarassing.

Nikki - your story is humbling, think you are stronger than me. Can't take credit cards away as he needs them for work expenses.

OP posts:
IrishDraught · 04/09/2009 18:45

Your DH is on 70k? I think you should leave the kids money, stop making excuses that it would be wrong to let them have it. You have said yourself you think you may just run it up again. You and DH cut back, you both spent the money. Sorry this sounds harsh but geez, when that moneys gone, what will you do next? Raid their piggy banks? At one point you had an income of 140k (?)

shakirashakira · 04/09/2009 18:48

Re: the lattes. I asked for a Starbucks card for xmas when we were on a budget. Not at all exciting, but actually it was better than bubble bath and saved me cash.

Original poster
kaz33 · 04/09/2009 18:48

No longer a solicitor though working in the legal field.

I hate Nespresso machines and have one already, someone gave it to me as a present - theres something else I can sell, anyone interested?

I could sell my car and get a bike, though I do live on top of a hill so that would definitely deal with my need for a gym membership

OP posts:
Blondeshavemorefun · 04/09/2009 18:48

i cant believe your post of 18:26:26

"i dont want to work fulltime"

well sure many on here dont, but they HAVE to

surely incresing your days if possible or getting an extra job to earn extra money should be your pority

"Its the latte's, days out, haircuts, new school shoes, books, food that just filter the money away"

lattes are a few pounds- if you are having a few weekly then thats prob £10 saved - over the year £500

a family of 4 can manage to eat on £30 and get decent meals - make shepherds pie/lasgane/chicken casserole/fish pie etc and bulk with cheap veg from lidl

FabBakerGirlIsBack · 04/09/2009 18:50

I can't believe your husband is on £70,000 and you are not able to pay back your debts yourself.

Original poster
kaz33 · 04/09/2009 18:50

We were never had a joint income of £140K, more like £100K and a nanny (25K of taxed income) and lived in central london.

OP posts:
FabBakerGirlIsBack · 04/09/2009 18:50

Still a lot of money..

Morloth · 04/09/2009 18:52

How can you hate the Nespresso!?!? When you push the button the coffee comes out, you don't even need to be fully awake!

No helping some people...

Seriously though, either suck it up and get budgeting or accept that you will have a life of debt and be continuously treading water and never really get anywhere.

justabouteatingchocolate · 04/09/2009 18:55

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IrishDraught · 04/09/2009 18:55

I'm soeey, how could you eat your takeaways, have you haircuts etc. knowing your kids in a way have paid for it? Sit in the 20k car (credit?) knowing your kids are partly paying that off now. It's the principle. You are not on the breadline, can manage 5k off the debt by Christmas? 5k for every 3 months - you will be debt free 1.5 years. If your mortgage is 40% of a 100k income (no idea after tax) you still have a large amount you must be getting through.

Lizzylou · 04/09/2009 18:56

YOu have to cut your cloth and all that, you don't like nespresso and can't afford lattes from Starbucks?
Take a flask or stop drinking coffee during the day (unless free).
There was lots I used to do/spend on when I was earning good money pre-DC. I don't do hardly any of them now.
Go to a cheaper hairdresser, stop expensive days out (use vouchers or go to free places and take a packed lunch), library for books do an online shop for food, needs must I'm afraid.