Both in debt but need to move - help please

[greyskiesblue]

Hoping to get some advice please. I have £6k debt which is credit card interest free for next two years , partner has £12k on a loan. Combined income of around £63k. We rent and have no savings. We have a toddler, live in a one bedroom and can’t afford anywhere bigger as we don’t have the deposit.
Partner wants to stay as long as we can and save and buy, I want to save a deposit to rent somewhere bigger as it means we need to stay in our one bed longer if we save to buy, it’s a tricky situation. But we also have debt so feel unsure on what we should be doing.
What do we do first? Pay off our debt before saving to move ? I’m feeling a bit overwhelmed and trapped where we are. We live in an expensive area and because my partner doesn’t drive we can’t move far out because of his work and ridiculously early start times.

I feel pressure (from myself) because we do have a young child and we will need the space eventually. And I’m struggling with the lack of space.
Thank you

I would always follow Dave Ramsays baby steps.

1. Save a small emergency fund of £1000
2. Pay off all debt using snowball method
3. Save full emergency fund

3b. Save house deposit

A good UK version (assuming you're in the UK) is this one
https://simplymoneysavvy.co.uk/dave-ramsey-baby-steps-uk-version/

Whilst it may seem that space right now is key, you realise as the dc get older that it's really not. Far more useful to get yourself into a good secure position ready for when they're a bit older.

If you move to a bigger, more expensive rental now it will just be harder to clear the debt.

A few factors to consider:

If you can keep all your debt low/no interest, it makes it less of a priority to pay off. But being in debt will probably limit what mortgage you could qualify for.

Do you know how you got into debt and have you made improvements to make your budget look more positive? Have you reduced what you spend on non essentials?

Would a mortgage be more or less what you're paying in rent? Does your income qualify you for a mortgage you could use to buy a suitably sized home.

But it could be worth the 'investment' in your partner learning to drive, assuming he's not unable to for medical reasons. Eg if it costs £1000 to learn to drive but that would help you move somewhere bigger but where the rent is £250 pm less, it will pay for itself in 4 months.

However would that mean you'd need to run (another) car, which obviously also costs money, how is he currently getting to work? Can he change jobs for one with more regular hours?

I'm going to be the party pooper.
If you live in an expensive area, will you actually get a mortgage on a house even once you've got the deposit? Have you actually looked at what someone would lend you theoretically, and seen what is available at that price?
UseItOrloseItt looks to have a decent priority list, but id also look at how feasible saving the required deposit for a 2 bed flat would be. If that's out, rent the bigger place. If that's possible, stay where you are and pay down debt/save as fast as you can.

I think that clearing your debt and getting to a secure position is more important - for now - than moving or saving. Maybe give it to the end of the year and reassess.

How much are you paying every month off your debts? Can you cut back on anything you’ve not already looked into?

Looks like the cc debt would be feasible to pay off over 2 years.

How long does partner's loan go on for/£ per month?

I can’t even remember now how I got into this stupid debt, but it’s clearly on non essentials and spending when I shouldn’t have - I don’t have anything to show for it. So that’s the first thing that needs to change.

My partners issue with driving is that because of our work patterns we would need a second car and he isn’t willing to do that, he also won’t change jobs and I can’t ask him to do that as he enjoys his job

I’m worried that living in a one bed with a two year old is bad for our child. She’s happy being in with us atm but I feel so guilty I can’t give her more.
im paying £150 on my credit card, partner is paying £250 on loan.
we are looking at what we can cut back, we will have be strict for a long while

Around 250 a month

Not even sure to be honest, I feel absolutely screwed, probably renting is more feasible

You have a decent income, and sorry to be blunt, are unable to live within your means currently as you have debt you should be able to pay off relatively easily. You want to add to that with needing to pay more rent on a bigger place. The focus should be in getting rid of both debts ASAP, learning to live within your means, and then saving up after that.

I'd stay put for time being, frustrating as that may be. Partner needs to look for similar work in a slightly less expensive area.

Always pay of debt first.

I can’t even remember now how I got into this stupid debt

Until you can get your finances under control and have an awareness of your spending you would be mad to take on more financial commitments when you cannot manage the ones you have.

Look at options for your one bed flat. Can the toddler have the bedroom and you have the living area with a sofa bed? Declutter and living minimally so it feels more spacious. Get outside lots.

Focus on clearing your debts and controlling and be aware of your spending. Look at budgeting and planning your next steps carefully, run through some scenarios of moving jobs, getting a 2nd car, and cost it all out -spreadsheets are your friend. This is what most people (that I know) have to do. They don't just keep spending, taking on more commitments and wonder where it goes.

You can go and see a mortgage broker now and get an idea of where you'd need to be in order to buy where you currently are. I used a paid independent broker but he didn't charge until he'd actually got me the mortgage, no up front cost and he had a great incentive to give me the best possible advice.

I found that when I had a specific goal in sight it was far easier to stop impulse spending, too.

I'd go over to money saving expert and do a statement of affairs.

Your figures aren't adding up currently so I don't see how they would in a more expensive property.

What was the loan for? In your position I'd cut everything down to the absolute essentials to try and get back on track as quickly as possible.

Are you paying for childcare and will that amount change when she is three?