Feeling a bit sick at 0 to £3k cc debt within 3 months

[Liesmorelies]

No debt other than mortgage and separate car loan (cheap car - £95 per month over 5 years, ends next year) for a few years now and suddenly it's gone up to £3k just like that. It's due to £1k leftover from big holiday (USA) spending in the summer - I knew this would have happened and thought it would be paid by now, which it would have had the following not happened:

• car repair at £500 just before we went away in July. Paid not on CC but obviously meant had less money in current account.
• Car service + minor repair when we got back - £400
• Cat having to be pts following some tests. After insurance still left with £400 to pay. Some of the claim was settled separately so I actually only pay £400 but didn't allocate the other money when it came in so total of £600 to pay now.
• New laptop for ds going to uni - £800
• Other cat needed dental work not covered on insurance - £700
• Adopted two kittens- £200
• Band ds2 loves announced long-awaited tour dates - been promised to ds for about 2 years - £350
• Other expenses for ds starting uni and travel - around £500. Not all put on CC but has meant less money at the end of every month to throw at the cc.

Ds starting uni means I have to give more money to him each month and have also had to raise ds2's allowance to match what ds1 had at his age - it's not huge but all adds up. I do have it all on interest free cards and should be able to spend around £500 on it each month, maybe more. In addition I have a £20k isa maturing at the end of the year, but wanted that to be a buffer for dc in uni so don't really want to touch it.

I know a lot of this was avoidable but it's scary how quickly it has all piled on.

This for me too. Even £100 a month into an easy access account paying a little interest.

The other thing I wondered was about the car. You say the lease is up next year. I wonder if it would have been possible to trade it in or sell it (using funds from that sale to fund your next car), or if you considered that. We had a balloon type lease on our last car and before the end of the term sold it on. The buyer paid off the lease company and we were left with a deposit for our next purchase. Would certainly consider doing similar if expensive repairs were mooted, if the lease allowed.

Access to credit doesn’t mean you have the means. That’s entirely the wrong mentality.

Access to credit for discretionary purposes just means you agree to pay through the nose for something you could have had cheaper, had you saved up. Debtor is slave to the lender.

If it helps OP, your son should definitely have time to work in the holidays. I didn't work much over Easter because exams were looming but I used to be able to do plenty over the summer holidays and a good bit over Christmas. And they were usually times when other people wanted holidays so I used to arrange to act as cover.

I do get what you mean about the fact that sometimes lots of expenses come at once. I had a time 2 years ago when I had arranged to have new carpets (totally fine, I could afford it), then I had a leak in the roof, and that was also the same time as my annual car service. The builder needed scaffolding so I asked them to sort the roofline woodwork because there is no point paying twice for scaffolding. Then a month later my washing machine and dishwasher broke.

I have a pretty hefty emergency/repairs fund but that was enough to mean I was having to take a fair amount of care to avoid needing to liquidate long terme investments.

What I would just add though is that it is worth considering that possibility when deciding not to have a cash emergency found. I would rather have both because then if a run of things happens all at once you can manage things between both 0% credit to support cash flow and and emergency fund. The reason I say that is because if you put everything on credit you are relying then on a period without any further "storms" to allow you to get back on an even keel money wise.

Oh, and your kid will likely be able to get a job with the uni itself if he needs to. They tend to have library assistant positions, bar jobs and the like for those who actually still need an income.

Why are you getting in debt for new pets?

You can also buy phones for under £200 at cex that are perfectly fine

So it'll be gone in six months, isn't attracting interest and you have 20k savings? That's fine surely.

We often put a holiday on a CC it's interest free, and savings attract interest, so it makes sense to keep the money in savings as long as possible and pay the holiday off out of monthly income.

This thread is heavily weighted towards living on tinned food and denying yourself anything other than absolute essentials whilst being puritanical about it. Your housing costs are low so your income is fine you don't have to live like you're in poverty, you're not.

How is she paying through the nose when it's interest free and her 20k savings are accruing interest and she has the means from income to clear the CC in under 6 months?

I haven't read the whole thread, but reading the replies on the first page, I think I'd only agree with the criticisms depending on your income. And if you can afford to pay it down at £500 a month, it's considerable. I say this because they are mostly one offs. And if you have access to free credit and can pay it down quickly, I don't think it's a huge problem.

Of course, it would be better to have a savings buffer rather than rely on credit, but if you've got £20K in an ISA, you do have that. With £500 in 'spare' money a month, I don't think £800 on an educational tool and £500 for a child starting uni is unreasonable by any stretch. Having the money tied up in savings wouldn't stop me - the CC is fixing a temporary cash flow problem, not being used to build up long term, unserviceable debt.

The anxiety about it is understandable and probably healthy but I don't think you should lose sleep about it.

I think your attitude to money is the strangest to be honest. 2 years ago your money started increasing but instead of having forethought about your DC starting university and saving towards that…you put it towards a holiday! I mean ffs!!

And if you have access to free credit and can pay it down quickly, I don't think it's a huge problem.

I think what people are saying is that her inability to save anything over the past two years is a sign of someone who might not be able to pay it down quickly. Most of us know people who have a pet/holiday/tech/whatever crisis seemingly every other month, because they can’t or won’t budget.

You’ve had a rough couple of months you’ll be fine. Your kids need to and can work even a weekend job. You earn loads, you’ll be fine.

Its scary how it piles up as you say! However a big holiday US.laptops ,vet bills.

The reason I say that is because if you put everything on credit you are relying then on a period without any further "storms" to allow you to get back on an even keel money wise.

Yes - none of us know what the future brings, so none of us should assume that over a period of x months there’ll be no essential purchases to pay for. In OP’s case, as a mortgage payer, the washing machine could need replacing, the roof could need fixing, a pipe could burst. Raiding her ISA wouldn’t be great and neither would putting the expense on a credit card.

well you came on here for advice but clearly want to justify your spending.

Pets and holidays are only for the super rich these days. You need to stop having them end of.

Absolute rubbish. I'd love a dog but can't afford the doggy daycare and kennel fees. I can afford cats. I'd love a long-haul holiday every year but can't afford it. I can afford it as a very occasional treat interspersed with budget trips to the continent.

Do not have pets, go on holiday or spend ANY money other than essential spends UNTIL you have an emergency fund of 6 times your net monthly salary

Again, rubbish. What if I were to drop dead while building up this emergency fund, never having gone on holiday/experienced the joy of pets? And I do have just under 6 months salary saved anyway. Or does the ISA not count? Are you meant to have sizeable long-term inaccessible savings AND 6 months' salary easily accessible before you go on holiday? Yeah, fuck that. And anyway, why 6 months salary? Surely 6 months' living expenses plus a small buffer is adequate for an emergency?

Access to credit for discretionary purposes just means you agree to pay through the nose for something you could have had cheaper, had you saved up. Debtor is slave to the lender.

Apart from mortgage and car, all my debt is interest free.

The anxiety about it is understandable and probably healthy but I don't think you should lose sleep about it.

Thank you.

2 years ago your money started increasing but instead of having forethought about your DC starting university and saving towards that…you put it towards a holiday! I mean ffs!!

Again, you talk as if I have failed to provide for ds going to uni, but I haven't. It's all well and good saying FFS as if a holiday is the most ridiculous thing in the world, but he is likely to be looking for internships next summer and maybe will want to go away with friends. It could well have been our last family holiday. Memories are worth more than money in the bank, assuming essentials are covered, which they are.

her inability to save anything over the past two years is a sign of someone who might not be able to pay it down quickly.

I did save - for a holiday. It's not endless spending on one frivolous thing after another. I've supported my two kids alone while on a lower income than I have now and no money from elsewhere. I'm perfectly capable of managing my money. The only silly decision was getting the kittens now rather than waiting, but they are a minimal expense and, to be fair, the dental work hadn't come to light then. If it had, I would have waited.

looks like you need to sit down and carefully work out a budget.

dc at uni needs to be supported (I disagree with the laptop being expensive -depending on the course that's what's needed, though hire purchase is sometimes a good option)

pets - sounds like you can't really afford to keep them well if you struggle with vet bills.

other dc - fair is not always getting the same things. if you can't afford the same, then you can't afford the same.

concert tickets - sell them. or ask for contribution as christmas/birthday present. keep travel cost low by travelling by coach and sleeping in a bunk house/hostel.

I earn a lot less than you, what I do is have different accounts for different things and put money into them monthly. So a Christmas account where I work out a budget and put 1/12 of that in when I get paid. You could put £100 into a general Car account, maybe £100 into a Cat account etc.

WHY DID YOU BOTHER TO POST IF YOU CAN JUSTIFY IT ALL? @Liesmorelies or did you just want to brag about your stupid overspending! 20k in an account is jack shit!

sounds like you can't really afford to keep them well if you struggle with vet bills.

Of course I keep them well! How rude. Vets bills are paid and all required treatment given.

ask for contribution as christmas/birthday present. keep travel cost low by travelling by coach and sleeping in a bunk house/hostel.

I've already said Christmas will be a lowkey to balance this, though I haven't phrased it as asking for a contribution. Despite what people seem to think, I/we don't throw money at endless stuff just for the sake of it. But travelling to this concert will be massively appreciated and enjoyed, and that's worth it imo. I've already booked a very reasonable AirBnB which is half paid for and the other half due just before we go, so fine. As for coach - come on! Have you heard of Ryanair?! Honestly, I appreciate the advice but some of the replies seem to come from a place of getting a kick out of being as frugal as possible as some sort of weird martyrdom.

But holidays and pets are a luxury and you can stamp your feet as much as you like but these things do come after everything else being budgeted for.

Yeap OP, money does not stretch for anything these days.
I would cut on all expenses for the next months and pay it as soon as possible. Because you never know when another thing will pile up.
The cost of keeping pets has gone well beyond the roof. You have done great taking two little ones. I will not be getting more though. We just lost one and we will not be getting any kittens. It is just too much.
Cut back on Christmas spending OP. No new clothes. Reduce take aways and wating out to a minimum.
Your youngest can count the tickets as his big present. Your eldest needs help with uni expenses more than anything.
And you are not that much into debt at all.

Nobody jumps up in from a low take home to nearly £4K. Your mortgage was low, no child care costs. You had the money and the time to build your buffer, you knew one of your son’s was going to university. If you’d been really frugal, you could also have saved for the holiday. This £3K credit card debt was completely unavoidable.

20k in an account is jack shit!

Ah, so we are in a place where no one should even think of having anything 'nice' unless they are super-rich? Fine but there's no need to live like that and I don't choose to.

@Liesmorelies if it's only you then it's probably worth 6 months salary in a emergency fund but you can build it up slowly so you still enjoy life. It takes 1 serious illness or cancer treatment to burn through 6 months of bills only quickly depending on your works sick leave policy.
Other option would be a illness cover policy but these are pretty expensive month on month.

I would say its worth looking at doing a proper budget though as realistically budgeting and finding areas to save means more available for holiday fund and emergency fund.

Long haul - it can be cheaper to have a holiday in certain countries of SE Asia then Europe if you can find flight deals. Stuff like Jack's flight club is handy.

I love my holidays and afford a few a year but because I budget well even with nursery fees etc.