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  • FIRST POST
    • Hayley33
    • By Hayley33 6th Oct 16, 12:48 PM
    • 43Posts
    • 16Thanks
    Hayley33
    It's really hard
    • #1
    • 6th Oct 16, 12:48 PM
    It's really hard 6th Oct 16 at 12:48 PM
    We've got quite a lot on the go I won't take out two cars at the same time again and I've just put my debts all in one place and if I can stick to a budget they'll be cleared in 3 years and on paper be £400 p/m better off. I was just in my overdraft before so I just used to switch out what I needed etc, within reason. Now I don't want to get into it again. But I always seem to have such a lot on I can see this is going to be really hard to do. On top of all the bills, the two car payments, the sofa payment, the loan to pay off the debts, there's clothes that my child always seems to need, the school always want something they ask for money most weeks, there's the school dinner bill, there's the endless birthday parties at £5 in the card each time., there's work where there's the constant collections for people, there's the never ending food shopping bill...... I REALLY want to pay off my debts and stay out of my overdraft. I've also opened up a little savings account in the hope that I can build up some money for myself. It's seems absolutely impossible to stay within a budget, you always need the credit card on top. I can't though anymore. I only work part time now around my husbands shifts because we can't afford childcare so my pay isn't the best but it will do until she grows up ( it will have to do). How do you all do it?
Page 4
    • enthusiasticsaver
    • By enthusiasticsaver 12th Oct 16, 7:52 PM
    • 2,540 Posts
    • 4,343 Thanks
    enthusiasticsaver
    Yes. Three years. So now no credit cards (unless the bill is paid IN FULL). One car loan to finish in 2.5 years £200 PM back. Sofa to finish in 1.5 years interest free £50 PM back. And then finally the loan £150 PM back in 3 years. I have had my moment I will not get into the credit card/ overdraft cycle again. I'm so sick of it. Was making me ill worrying about money all the time. I do roughly work out before pay day all I've got going on for the month and take money out accordingly. I'm going to slimming world I'm wondering if this is a bit of a waste of money but I really need to get my weight down also.

    That food budget is for 2 adults & a child I don't think that's excessive roughly £60 per week. I sometimes struggle to keep to that also, food is so expensive.

    It seems unacheivable because £100 doesn't seem like much over a whole month.
    Originally posted by Hayley33
    When money was tight I did not use the credit card as paying it off in full the next month meant we were short of money then and tempted to use the card again the following month for living expenses. I do not think anyone who is on a tight budget should be using a credit card due to the way it throws budgets out when you have to pay it off the following month. Only exception is large item on 0% divided up over interest free period. We always had a rule in that only one item on interest free at a time. Everything else had to be saved up for.
    Debt and mortgage free and saving for early retirement
    • MrsSave
    • By MrsSave 12th Oct 16, 8:06 PM
    • 994 Posts
    • 3,025 Thanks
    MrsSave
    When money was tight I did not use the credit card as paying it off in full the next month meant we were short of money then and tempted to use the card again the following month for living expenses. I do not think anyone who is on a tight budget should be using a credit card due to the way it throws budgets out when you have to pay it off the following month. Only exception is large item on 0% divided up over interest free period. We always had a rule in that only one item on interest free at a time. Everything else had to be saved up for.
    Originally posted by enthusiasticsaver
    I think it depends on how 'in control' of things people are. I use my Tesco credit card for the majority of my purchases each and every month. What I've done is set up a separate account, and as soon as I buy something on the credit card, I update it as spent on YNAB, and then move money from my current account to this other account so that when the bill comes in I've got all the money sitting waiting. It doesn't affect next month's budget at all.

    It does mean being completely on top of things and making sure that there's no temptation to buy things that aren't part of that month's budget. So far it has worked for us, and we then use the points for days out/meals out. I'm not sure it would work as well for someone at the start of their debt free journey or someone who wasn't on top of their budget.
    Emergency fund #16 £20/£1000
    Loan repayments: 15/60 Overpayment total: £25
    Check out my debt free diary 'A Pound Stretching Maternity' below:
    • Sanctioned Parts List
    • By Sanctioned Parts List 12th Oct 16, 9:55 PM
    • 294 Posts
    • 764 Thanks
    Sanctioned Parts List
    I think it depends on how 'in control' of things people are. I use my Tesco credit card for the majority of my purchases each and every month.
    Originally posted by MrsSave
    Exactly.

    But the only way it works is to have cast iron control over every aspect of your spending, track every account and every expense and be just a little bit obsessive about it.

    Apart from the market, which is cash only*, everything that we can spend on Amex, goes on Amex, and being a charge card it's paid automatically in full every month (because the penalty for not doing so is too much to contemplate). For anywhere that doesn't take Amex, we have another Visa credit card that they will take, and is also paid in full. The Amex takes its DD on the second of the month, and the visa on the eighth.

    As I've mentioned elsewhere, we don't budget. I track all household spending meticulously. Everything goes into KMyMoney** in mind-numbing detail - all debts, all savings, all spending. Takes about 5 minutes per day, but getting it set up in the first place took a solid weekend of manually entering a year's worth of bank and credit card statements - because the power of the software only comes out when it's got a good large set of data to analyse. (That then shone a light on all the waste and allowed us to take an axe to our spending.)

    Because of that, I can see that this month we're overspending on both Amex and Visa as our relocation-to-the-UK costs bite. But I can see that all that will happen is that I will have to pull some money out of a buffer account for a few days between one DD being taken and some expenses arriving in case a utility company with a history of taking their DD on arbitrary days does so again. In the meantime I can pick up the pace on freelance work to try to make up the difference.

    That's the advantage of 3 weeks notice.

    If I didn't track and analyse spending like this, then using credit cards would be bad, wrong and dangerous.

    * When accounting for cash, I track cash withdrawals and treat them as if the whole value of the withdrawal is immediately spent.
    ** I don't use YNAB because, well, I don't budget, I like free software, and I don't see that it offers anything that free alternatives don't.

    PS: I think that might have finally answered the question, "How do you guys do it?"... at least in this little corner of the world

    • EssexHebridean
    • By EssexHebridean 12th Oct 16, 10:36 PM
    • 6,315 Posts
    • 35,033 Thanks
    EssexHebridean
    That's an interesting take on it SPL - not sure I'd have the patience or the self discipline to keep it up mind you! I do like a spreadsheet - our mortgage OP's were all input into a spreadsheet so we could instantly fiddle with figures and see the impact of a few £'s here and there extra paid over...that ability to see what effect we were having was what drove us on, it really did make a difference seeing how much we were saving over all, as well!

    I'm not a fan of chargeable budgeting software either I have to admit. It seems totally counter-intuitive to me to pay for something to help you save money, but each to their own and if it works for people then good for them.

    As for CC use - a cashback card can be a wonderful thing used correctly. If you're on a tight budget though you really do have to keep a tally of every penny that goes on it - ideally paying off each item as it hits the card account. That way you still earn the cashback but don't risk things getting out of control. If I was starting from a point where my outgoings were exceeding my incomings though I wouldn't even contemplate using the CC - I'd close the account, as the temptation in a tight month would just be too great.
    MORTGAGE FREE 30/09/2016
    • Sanctioned Parts List
    • By Sanctioned Parts List 12th Oct 16, 11:06 PM
    • 294 Posts
    • 764 Thanks
    Sanctioned Parts List
    That's an interesting take on it SPL - not sure I'd have the patience or the self discipline to keep it up mind you!
    Originally posted by EssexHebridean
    5 minutes per day isn't such a chore. I dealt with today's receipts (2 taxis, a cash withdrawal and a swift pint after work) while waiting the 2 minutes for dinner to warm up in the microwave - such is the joy of commuting. I originally thought I'd "use it to get on track" and then hopefully would have developed good instinctive habits and could stop with the tracking. In fact, every time I've stopped putting the numbers in the computer, our spending increases by 50% overnight.

    It seems knowing what I have today, tomorrow, and at the end of the month is the spending equivalent of bromide.

    I do like a spreadsheet
    Originally posted by EssexHebridean
    I do, too - our "budget" such as it is, is a spreadsheet 3 columns wide and 20 rows long, that details our monthly income, scheduled payments and "everything else" allowance. That sets what goes into the buffer account, which happens on pay day. I'm quite relaxed about using the buffer account, provided our 3 month moving average is roughly the "everything else" allowance.

    I'm not a fan of chargeable budgeting software either I have to admit. It seems totally counter-intuitive to me to pay for something to help you save money, but each to their own and if it works for people then good for them.
    Originally posted by EssexHebridean
    I'll never say "don't use it"... but alternatives do exist.


    As for CC use - a cashback card can be a wonderful thing used correctly. If you're on a tight budget though you really do have to keep a tally of every penny that goes on it - ideally paying off each item as it hits the card account. That way you still earn the cashback but don't risk things getting out of control. If I was starting from a point where my outgoings were exceeding my incomings though I wouldn't even contemplate using the CC - I'd close the account, as the temptation in a tight month would just be too great.
    Originally posted by EssexHebridean
    This was one of the longer discussions my wife and I had - whether moving to a charge-card, i.e. post-pay spending was a good idea or not. Advantages were air-miles (we use them, being a fairly mobile family) and early warning of expensive months, disadvantage was risk of spending beyond our capacity to repay.

    We'd been tracking through the computer for close to a year before I finally took the card. In that first month, out of fear, we were positively miserly and over-saved, which made the transition easier.

    • MrsSave
    • By MrsSave 12th Oct 16, 11:12 PM
    • 994 Posts
    • 3,025 Thanks
    MrsSave
    I think that this is surely showing that there are many different ways to work at becoming debt free, and no 2 people will agree 100%. That's completely fine, though, as long as people are doing what works for them.

    Hayley, it's ok to dismiss some pieces of advice, but remember most people posting will have been in this situation for a long time and have worked hard at becoming debt free/mortgage free/decreasing debt so can see what things aren't likely to work as they've been there themselves. It's up to you how much you take on board and how many changes you make.
    Emergency fund #16 £20/£1000
    Loan repayments: 15/60 Overpayment total: £25
    Check out my debt free diary 'A Pound Stretching Maternity' below:
    • EssexHebridean
    • By EssexHebridean 28th Oct 16, 6:18 PM
    • 6,315 Posts
    • 35,033 Thanks
    EssexHebridean
    How are things going Hayley?
    MORTGAGE FREE 30/09/2016
    • Purplemumof2
    • By Purplemumof2 28th Oct 16, 9:43 PM
    • 3,923 Posts
    • 11,517 Thanks
    Purplemumof2
    I did, hopefully it'll be gone soon.
    Official DFW Nerd Club - Member no. 791 - Proud to be dealing with my debts
    BC: £8850.00 Overdraft: £2750.00

    15 NSD - 8/15, 10 LSD - 3/10, 15 AFD - 1/15, Lunches to work 9/20

    20p Savers 2016 £2 Savers 2016 50p Savers 2016 SPC 9 2016 #003
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