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I have just recently moved out of home



Let me start by telling you a little about myself. I am 21 (female) and I have a 14 month old daughter.
I have just recently moved out of home, wanting the independence and responsibility of raising my daughter in my own place. Well, sort of my own house, I am renting and living with my sister who is 22.

When we moved out we didn’t really have an idea of the money involved in setting up a new house, or the regular bills that keep coming in.

Now, we do pay our bills and make sure that we are not late on the payments however we are finding it a bit hard paying all the different bills that we have.

In around 1 year we have incurred around $13,000.00 worth of we are thinking of maybe getting a debt consolidation. What do you think about the idea?

A break down of our bills is a $3000 loan, a $1400 credit card, a $1500 credit card $2000 at DTR, and other things such as that.

I eventually want to be debt free no doubt, but I would like to know your advice on the quickest way to get there. I am on the DPB, working part time and studying at the moment so that I’m not on it for the rest of my daughter’s young life, and would like to start a business from home maybe some time in the next year. And eventually buy a house. And on that note, what are your views on renting to buy?

Anyway, I have the opportunity to work at my sister’s work for around 3 months, to earn me some money to help pay off my bills a bit quicker.

Please help me! any advice would be good. My father would have a heart attack if he knew how stupid we have been, and no doubt in the next year he will help me to start up a business and need to know all my finances... which I would like to get down before he is able to see them!

My appreciation



Stepping out in the world by yourself is a big challenge and expensive as you have found out.

The main points to consider are;

  • The accumulation of consumer debt. The debts are very high interest bearing and at $13,000 you are facing a hard slog to get them under control and this should be your number one priority for sure. Even at say an average of 18.00% per annum, interest alone on that sum is $195.00 per month. To pay the amount off over 60 months will take around $300.00 per month, with no additional debt.
  • I see little good coming from consolidating these debts, just get hard on yourself, cut up the credit cards, and pay them all off as fast as you can. They will not go away.
  • The management of your day to day budget. This appears to be getting better but you are coping with a lot, a wee child, study and working part time plus sharing the running of the home. Ensure you do keep a little in reserve for yourself but keep carefully to a written household budget.
  • Working while on the DPB. I know it is tempting to pick up what seems easy extra cash working a bit here and there. But be very careful you do not place in jeopardy your DPB payments. Talk to WINZ to get a very clear understanding of just what you can and can’t do in your particular circumstance.

Business and your own home are not within your grasp right now. Tidy up your finances, get a good habit going on your cashflow management, get a good reserve of savings behind you, finish your study and by the way tell your father – you might just be surprised. Then start looking – good luck.

Original Article published August 2005

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