The Debt Panel: Abu Dhabi resident with debts of more than Dh350,000 pays his rent with credit cards

The banker, who shares his Dh44,000 a year villa with his wife and daughter, is also behind on two terms' worth of school fees.

Clockwise from top left: Ambareen Musa, founder and CEO of; The National columnist Keren Bobker; Philip King, head of retail banking at ADIB; and Rasheda Khatun from Financial Life Planner, provide insights on why people are getting into excessive debt, how this situation can be resolved and where they can turn for help. Ravindranath K, Satish Kumar, Marwan Alhammadi and Mona Al Marzooqi / The National
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I am sinking under my debts and need help to restructure, consolidate and settle my dues as soon as possible. I've been driven into this situation as I depend on credit cards to pay my rent of Dh44,000 on a villa in Abu Dhabi because my salary has not been rising. I pay the landlord in three cheques, and in addition I take care of my parents in India. I have loans as well and my wife is in the same situation. We took out the loans to settle some issues in India and because we defaulted on a card payment once, the credit card debt just started mounting. I signed up for my first credit card with an Dh8,500 limit in 2014. This was to sponsor my family. Then during every rent payment I'd take out new cards. When I started being refused new credit cards, I made my wife sign up for cards too – so now her income is also swallowed up by payments. While I work for a bank earning Dh9,372 a month, my wife works for as an English teacher in a school, earning Dh6,500. In total we owe Dh226,000 on three loans with monthly repayments totalling Dh5,800. We also owe Dh127,100 on seven credit cards. We have nothing left and we owe two instalments of school fees for our 10-year-old daughter. Please rescue us from the claws of debts by giving us some advice on proper financial planning. AP, Abu Dhabi

Debt panellist 1: Rasheda Khatun Khan, a wealth and wellness planner

Make no mistake, spending more than you earn will result in debt. The longer you spend like this the more debt you will accumulate. This is not something you don’t know, right? The real question should be, why do you spend more than you earn? And not just for one month, but continuously. This means your regular monthly expenses are greater than your monthly income. This is not an issue of expenses, but rather an issue of behaviour and habit.

The first step here is to cut your expenses right down. If you have a car, sell it along with all your unwanted and unneeded items. Next, move house. If you cannot afford the rent, you have to move. Paying for your rent on a credit card will keep you locked into debt forever. Ask friends and family for help. Maybe you can make extra money by doing a few cash-in-hand jobs, or perhaps your family can give you a loan with no interest. Monitor what you spend on groceries. Limit yourself to necessities. Make a list of necessities before you go shopping and then re-examine your list to reduce it even further. Change your daughter’s school for now, too. Right now in this situation, spending on “unnecessary” items has to stop.

Next, target your credit cards. Make a list of your cards with outstanding amounts and repayments. Approach banks to consolidate what you can. Then approach debt consolidation companies to see what options they have for you. Evaluate all options to help you decide what your next step is.

Thirdly, understanding your money patterns and spending behaviour is crucial. This is where debt accumulates from. Ask yourself a series of questions:

Do I spend first or do I save first?

What expenses would I put on my credit card?

When I look at my credit card balance, do I first see my available balance or the amount owed?

How often do I evaluate my expenses?

How often do I buy things I want versus things I need?

How quick do I decide to make a large purchase?

Once you have answered these questions, have a look at your answers. Really have a look. Evaluate which behaviour causes your patterns of debt. If the root cause is not addressed, the issue of debt will be a constant fixture throughout your life. Find a money coach that you can talk this through with.

Debt panellist 2: Ambareen Musa, founder and chief executive of

With a combined monthly salary of just under Dh16,000, and total debt of over Dh350,000, debt consolidation looks difficult, as your liabilities are 22 times your salaries. You have already missed your minimum credit card payment, and the interest and fees would have started piling. Before you know it, you’ll hear from debt collection agencies. You could possibly explore the debt restructuring route, but that will involve speaking to all banks individually, explaining your situation to them and requesting a new payment plan with a longer tenure/lower interest. Since you work for a bank, this would be a good place to start.

It’s also time that you take the steps you should have taken a few years back: conscious and strict budgeting, which is indispensable if you want to make a difference in your financial situation.

First, make a list of your current monthly expenses such as rent, school fees, basic household and utility expenses, loan instalments, credit card payments and so forth. Eliminate all unnecessary spending, and try to cut back in other categories. Can you move to a cheaper accommodation? Can you move your daughter to a school that charges lower fees, or perhaps have her complete a school year back in India? If living with the grandparents is an option, you can take advantage of the much lower school fees back home. This will allow you to move into a smaller and cheaper accommodation, and the money saved on school fees and rent can be used to repay your debt.

In the meantime, don’t miss making your minimum card payments every month. You can start by paying off the smallest credit card debt first, and close the credit card account once that’s done, as this will encourage you to continue with your debt repayment mission. Keep doing so with the other credit cards until all your credit card debt is paid off.

The Debt Panel brings together four financial experts: Philip King, the head of retail banking in the UAE at Abu Dhabi Islamic Bank; Ambareen Musa, the founder and chief executive of the comparison website; Rasheda Khatun Khan, a wealth and wellness planner and founder of Design Your Life; and Keren Bobker, The National's On Your Side columnist and an independent financial adviser with Holborn Assets in Dubai. Together they answer queries in a weekly online column to help readers better tackle their debts. If you have a question for the panel, write to

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