End of the month crisis

You say we and you don't list childcare as an expense. My first thought is reduce your housing but I know that can be hard. At least consider it. If you have a mortgage you probably have more than 1 bedroom. Rent that out! Time for a second job for both of you. Side benefit is you don't have time to spend money you don't have. You can chase all kinds of zero interest credit cards and loans but you will be right back where you are because your housing is more than 50% of your income. Make. More. Money.

And I know there are all kinds of excuses. I've been there. Short term pain now will set you up for a better life later.

zeddy wrote: ↑ You say we and you don't list childcare as an expense. My first thought is reduce your housing but I know that can be hard. At least consider it. If you have a mortgage you probably have more than 1 bedroom. Rent that out! Time for a second job for both of you. Side benefit is you don't have time to spend money you don't have. You can chase all kinds of zero interest credit cards and loans but you will be right back where you are because your housing is more than 50% of your income. Make. More. Money.

And I know there are all kinds of excuses. I've been there. Short term pain now will set you up for a better life later.

This, but also chase those zero percent loan CCs to lower your interest payments for as long as you can. Paying couple percent in balance transfer fees is still better than the 18% on the entire balance.

If you qualify, look into a HELOC even from a 2nd lender that might not give as good of a rate as your mortgage provider.

But it’s mostly like what the above poster said: you need more money, as what you are currently doing isn’t sustainable unless you make more money. You’re basically house poor. At least you have a house though, so that’s one step in the right direction in this market.

Reddeals77 wrote: ↑In short towards the end of the month we struggle to save any money. Is there any banks where we can open a chequing a/c and transfer all credit card and LOC balance and combine it together at a low interest rate or so at least for a year.

Income : After taxes 5000 per month, mortgage 2000, property tax & home bills 800, LOC 20000 used up paying interest only, 3 or 4 Credit cards 15000 paying interest only, Car 250/ month.

Thanks

Info you provided leaves you with 1950/month for gas/groceries/entertainment/etc...

How do you have 35k in debt? What are you paying interest on?

The MBNA TrueLine Mastercard may be useful to you. But you'd have to do your research on the card to see if it makes sense for your exact situation. You might also want to seek out a debt consolidation service like Consolidated Credit Counseling.

To be honest, just on the numbers alone and not knowing your personal situation - I'd probably take a serious look at selling my house. I'm not sure where you live in Canada, but if for example you live in Calgary, you can rent a reasonably nice 2 bedroom condo for $1,500-$1,600 all in and the only extra bills you'd need to pay is electricity and internet.

If you can extract some cash as part of a sale and put it into your $35K in debt and start from scratch then spend a couple years renting you could completely reset your finances.

On your current path, if you can't make any more money, eventually you're going to collapse under the weight of compound interest.

Reddeals77 wrote: ↑ In short towards the end of the month we struggle to save any money. Is there any banks where we can open a chequing a/c and transfer all credit card and LOC balance and combine it together at a low interest rate or so at least for a year.

Income : After taxes 5000 per month, mortgage 2000, property tax & home bills 800, LOC 20000 used up paying interest only, 3 or 4 Credit cards 15000 paying interest only, Car 250/ month.

Thanks

If I understand your question correctly, you want a chequing acct that can be used to pay off your LOC and CC balance. You can not borrow money from a chequing acct, except with over draft option which charges high interest rate like CC. If your LOC is against your house, then it is usually at low rate already.

downsize. you have way too much debt. next time dont rack up 40K in debt.

networksend wrote: ↑ Info you provided leaves you with 1950/month for gas/groceries/entertainment

Op’s pay LOC, 3 to 4 credit cards plus interest. That why he/she goes into debt trap.

karnige wrote: ↑ downsize. you have way too much debt. next time dont rack up 40K in debt.

I agree, a credit card only gives you more money once and if you can't keep up with your own money you'll be in the hole soon but now with a balance owing.

Open up an Excel sheet and budget!

Reddeals77 wrote: ↑ In short towards the end of the month we struggle to save any money. Is there any banks where we can open a chequing a/c and transfer all credit card and LOC balance and combine it together at a low interest rate or so at least for a year.

Income : After taxes 5000 per month, mortgage 2000, property tax & home bills 800, LOC 20000 used up paying interest only, 3 or 4 Credit cards 15000 paying interest only, Car 250/ month.

Thanks

What you are looking for is not a checking account but a debt consolidation loan. A debt consolidation loan can sometimes help if the rate of interest on the loan is lower than the current rates of interests on the debts that you are consolidating. BUT - and I am capitalizing because it is a BIG BUT - debt consolidation loans will not solve an over spending problem which you clearly have. You have consumer credit of $35k of which you are only making interest payments on and you state that you are struggling toward the end of the month. This isn't a problem of interest rate - it's a problem of overspending. Time to review your spending and make cuts.

As mentioned above, a viable options is a Home Equity Line of Credit (https://www.canada.ca/en/financial-cons ... redit.html) to consolidate all your debts then close all credit cards.

Most banks offers this service but its important to choose the one with the best interest rate if you qualify: https://www.ratehub.ca/best-mortgage-rates/heloc

Thereafter, stick to debit (without overdraft) or cash only to help your overspending.

The fact that you are needing to do something to make ends meet is a GOOD THING because it is forcing you to take a look at how to readjust your finances in a way that works.

However, you need to really do everything you possibly can to avoid taking on more debt. Debt is dangerous and it will really limit your freedom moving forward and add unnecessary stress to your life.

Here is a summary of a plan that may assist:
1. Calculate exactly how much extra money you need each month to cover your current shortfall. Let's say for example sake, it is $500.
2. Then itemize all of your monthly CURRENT expenditures by payee or expense type to see where all of your money is going. This would be useful to do in a spreadsheet program like Excel where you can list the name of the expense and then enter the amount beside it.
3. For each item listed in #2, go back and tag the ones that are optional. By optional, I mean, that while you like having them, you don't really need them to live. Remember the difference between NICE to HAVE and HAVE to HAVE.
4. Then, see if in the OPTIONAL category, there is enough to cover the $500 that you can draw from. This might mean keeping your cell phone or cable account but downgrading your plan to something less expensive and more bare bones. If you can cut $500 from your expenses, take the steps and you are good to go.
5. If you cannot come up with your shortfall in #4, you need to either earn more money OR look at downsizing your housing situation.

I would treat downsizing my housing as a last resort BUT you should not kill yourself with debt just to keep your place and don't feel like there is anything wrong with selling your place. You will come out ahead in the long run. You do not want to hurt your financial future by taking on more than your finances can support and you can always upsize later when you have the income to support it or perhaps the market will drop enough to allow it. But for now I would make taking care of my finances a first priority.