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  • FIRST POST
    • zippygeorgeandben
    • By zippygeorgeandben 3rd Dec 16, 11:11 PM
    • 661Posts
    • 756Thanks
    zippygeorgeandben
    Unsure whether to consolidate - please advise
    • #1
    • 3rd Dec 16, 11:11 PM
    Unsure whether to consolidate - please advise 3rd Dec 16 at 11:11 PM
    Hello everyone,
    First of all, I can't believe I still remembered my username and password. It's quite a while since I've logged into MSE!
    Anyway, here are the facts.
    I currently have three debts I am paying off
    1) £5727.54 loan(started at £11k)with Zopa @ 4.8% - I pay £230pm
    2) £7568.74 loan(started at £12k in 07/2014)with Tesco @ 4% - I pay £222.61pm
    3) £4211.19 credit card with Virgin Money @ 0% until June 2017 - I pay £200pm (which is more than the £50pm they ask for)
    Total debt equals £17,507.47.
    Total monthly payments are £653pm

    I wish to reduce my monthly direct debit outgoings to give me more flexibility for stuff I want to buy.
    After having a brief search, Sainsbury's have a loan for £18k (so this covers all the debts written above) @3.1% which would mean me paying £323.89pm.
    TSB have a loan for £18k @3.5% which is £328pm. I'd be paying £1621 in interest for this deal.
    Both these loan repayments per month are roughly £330 less than I currently pay off per month at the moment (which as I've said above, are £653pm)

    I can't seem to find the wood for the trees here. What would you do?
    Would you just continue to pay the three original debts off? I can afford these repayments (just) but it doesn't give me lots of flexibility.
    Or would you consolidate all three debts, pay them off, and take out a new 5 year loan where the monthly payments would be reduced by over £300?
    Or is there another option I should consider?
    Thanks for reading,
    Ben
Page 4
    • Reb2016
    • By Reb2016 1st Sep 17, 12:45 AM
    • 90 Posts
    • 103 Thanks
    Reb2016
    You've done so well, that's a huge amount to clear in a year. Looking at the figures you were thinking of paying for a consolidation loan, you wouldn't have paid even half that amount, so not taking the loan has made a major impact.

    I've just realised you asked if I have a diary, I do, you can find it here http://forums.moneysavingexpert.com/showthread.php?t=5660404

    I think doing a year on round up is a great idea, and I'll steal it for when I get to my first year, if you don't mind, it just shows how far you have come in one year. Threads like yours really do inspire me to keep going.

    Reb
    Light bulb moment 6th June 2017 £13333.63 Debt now 12359.94
    DFD was October 2020 40 months now 31st May 2020 33 months Overdraft £450/£2250
    11/17 NSD September 9/4 in a row
    • enthusiasticsaver
    • By enthusiasticsaver 1st Sep 17, 5:25 AM
    • 4,260 Posts
    • 7,688 Thanks
    enthusiasticsaver
    Well done on clearing so much of your debt. Much better plan than debt consolidation. Hopefully the Zopa loan will soon be gone and you can tackle the Tesco one.

    I am going to suggest you start to get in the habit of saving for holidays rather than use credit cards. Calculate the amount you will spend in 2018 and divide by 12 and start putting money away for this. Same goes for gifts for your dad and partner and your dental work. This might mean you don't have as much money to overpay the debts but at least you can start to get out of this circle of debt. You also need an emergency fund. It does not have to be huge but at least another option other than a credit card.

    My plan would be to calculate what all of these extra ordinary expenses would be and divide by 12 and save that plus £50 to £100 per month on an emergency fund. What impact would that have on your debt repayment plan?
    Countdown to early retirement on 21.12.17 3 months to go.
    • Catsacor
    • By Catsacor 1st Sep 17, 6:00 AM
    • 20 Posts
    • 27 Thanks
    Catsacor
    You are an inspiration and such a role model for the members who are now where you were when you started your 'journey'
    • Reb2016
    • By Reb2016 1st Sep 17, 8:45 AM
    • 90 Posts
    • 103 Thanks
    Reb2016
    Catsacor, I completely agree with you, I very nearly consolidated but thankfully was turned down, reading this thread reminds me that I can do it.


    I also agree with enthusiastic saver on the emergency fund and presents fund, I recently had a small emergency (water leak) and it was great to not use the credit cards.

    Reb
    Last edited by Reb2016; 01-09-2017 at 8:47 AM.
    Light bulb moment 6th June 2017 £13333.63 Debt now 12359.94
    DFD was October 2020 40 months now 31st May 2020 33 months Overdraft £450/£2250
    11/17 NSD September 9/4 in a row
    • Dobbibill
    • By Dobbibill 1st Sep 17, 9:53 AM
    • 2,288 Posts
    • 3,415 Thanks
    Dobbibill

    Well when the clock hits 00:01 it's my first year anniversary of deciding to tackle my debts.

    My debt on September 1st 2016 was £19766.82 and as of today it is down to [B]£11499.70. I have managed to clear £8267.12 off my debt in a year!
    Originally posted by zippygeorgeandben
    Happy Anniversary on tackling your debt.
    You have achieved so much in 1yr.

    Plans for 2017-2018 are as follows;
    1)I start a new job on Monday which should give me an extra £250-275 per month to throw at debts, probably the Tesco one.

    I don't have an emergency fund if anything should happen and this slightly concerns me as I'm throwing 'extra' money at reducing debts. Wouldn't mind some advice on this MSEers.
    Congrats on the new job - all the best for Monday.

    I love the way you have set yourself clear plans for the coming year.

    I agree with other posters about saving monthly for birthdays and dental treatment.

    As for the emergency fund - there is a £1000 EF thread going here if you wanted to join for motivation, something should be going into an EF each month.
    http://forums.moneysavingexpert.com/showthread.php?t=5076051

    Life has a habit of throwing curve balls into plans. Yes this would mean less each month but you can always overpay more when you've reached your EF target or if you spend under budget on birthday celebrations.

    Maybe the extra income could be used for this - so you would still pay off a huge amount in the coming year

    All the best - you are doing brilliantly.
    I'm a Board Guide on the Energy, Student Money Saving, UK Armed Forces and
    Local Money Saving - Wales boards. I'm a volunteer to help the boards run smoothly, and I can move and merge posts there.
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.


    A person who never made a mistake, never tried anything new.
    • zippygeorgeandben
    • By zippygeorgeandben 1st Sep 17, 2:04 PM
    • 661 Posts
    • 756 Thanks
    zippygeorgeandben
    Hello everyone - just logged on. I re read my post yesterday, almost think to myself was i drunk? when I wrote it. I really hope that my post doesn't come across as smugness to anyone reading it because that's a trait I hate in anybody else. I've just been consistent in writing down monthly what I've been up to.
    I actually note down day by day what I spend on a monthly spreadsheet and if I overspend, I write down why. For example, August I overspent by about £300 but that's because I overspent on the Tesco loan by around £660.
    I'll answer points individually from members thus far but one thing I have failed to mention so far I have a bit of credit in my bank account, not a lot but when my salary gets paid in, I'm normally about £3500 in credit and it normally goes down to about £1500 so I can always decide to put some of this away for debt or 2018 spends.
    Off for lunch, last day off!
    Thanks for reading
    End Sep 2016 End August 2017
    £8236.57 £4876.49
    (Tesco 4.8%) £222.61pcm
    £6185.75 £851.34 (Zopa 4.0%) £48.99pcm

    £5344.50
    £2890.04 (Sainsburys 0% until 06/19) £140pcm
    £2000.00 £1333.35 (Sister 0%) £133.33pcm

    Total debt
    £19.766.82 £11499.70 Original DFD May 2019.
    • Reb2016
    • By Reb2016 2nd Sep 17, 9:09 PM
    • 90 Posts
    • 103 Thanks
    Reb2016
    I don't think you come across as at all smug, just rightly pleased and proud of how far you have come.
    Hope you enjoyed your last day off.

    Reb
    Light bulb moment 6th June 2017 £13333.63 Debt now 12359.94
    DFD was October 2020 40 months now 31st May 2020 33 months Overdraft £450/£2250
    11/17 NSD September 9/4 in a row
    • zippygeorgeandben
    • By zippygeorgeandben 4th Sep 17, 10:25 PM
    • 661 Posts
    • 756 Thanks
    zippygeorgeandben
    Well done on clearing so much of your debt. Much better plan than debt consolidation. Hopefully the Zopa loan will soon be gone and you can tackle the Tesco one.

    I am going to suggest you start to get in the habit of saving for holidays rather than use credit cards. Calculate the amount you will spend in 2018 and divide by 12 and start putting money away for this. Same goes for gifts for your dad and partner and your dental work. This might mean you don't have as much money to overpay the debts but at least you can start to get out of this circle of debt. You also need an emergency fund. It does not have to be huge but at least another option other than a credit card.

    My plan would be to calculate what all of these extra ordinary expenses would be and divide by 12 and save that plus £50 to £100 per month on an emergency fund. What impact would that have on your debt repayment plan?
    Originally posted by enthusiasticsaver
    Hi - thanks for your kind motivating words enthusiastic saver. I understand what you are saying about saving each month and I totally get the not being too reliant on credit cards for holidays. Perhaps as a compromise I should just ignore the fact that the holiday is on a 0% credit card and pay it either off in maybe 3 lump sums or 1 whole lump sum. The total for 2018 would be around £2500.
    End Sep 2016 End August 2017
    £8236.57 £4876.49
    (Tesco 4.8%) £222.61pcm
    £6185.75 £851.34 (Zopa 4.0%) £48.99pcm

    £5344.50
    £2890.04 (Sainsburys 0% until 06/19) £140pcm
    £2000.00 £1333.35 (Sister 0%) £133.33pcm

    Total debt
    £19.766.82 £11499.70 Original DFD May 2019.
    • zippygeorgeandben
    • By zippygeorgeandben 4th Sep 17, 10:26 PM
    • 661 Posts
    • 756 Thanks
    zippygeorgeandben
    You are an inspiration and such a role model for the members who are now where you were when you started your 'journey'
    Originally posted by Catsacor
    Thank you so much for this Catsacor. I wouldn't say an inspiration but maybe if it gets one person who is thinking consolidation to rethink their goals, well that's great.
    End Sep 2016 End August 2017
    £8236.57 £4876.49
    (Tesco 4.8%) £222.61pcm
    £6185.75 £851.34 (Zopa 4.0%) £48.99pcm

    £5344.50
    £2890.04 (Sainsburys 0% until 06/19) £140pcm
    £2000.00 £1333.35 (Sister 0%) £133.33pcm

    Total debt
    £19.766.82 £11499.70 Original DFD May 2019.
    • zippygeorgeandben
    • By zippygeorgeandben 5th Sep 17, 10:18 PM
    • 661 Posts
    • 756 Thanks
    zippygeorgeandben
    UPDATE
    For all those who have read my thread with interest and understand what I've been paying off, I have just been given £10,000.
    What do you think I should do with the money please? Thanks
    End Sep 2016 End August 2017
    £8236.57 £4876.49
    (Tesco 4.8%) £222.61pcm
    £6185.75 £851.34 (Zopa 4.0%) £48.99pcm

    £5344.50
    £2890.04 (Sainsburys 0% until 06/19) £140pcm
    £2000.00 £1333.35 (Sister 0%) £133.33pcm

    Total debt
    £19.766.82 £11499.70 Original DFD May 2019.
    • Dobbibill
    • By Dobbibill 5th Sep 17, 11:01 PM
    • 2,288 Posts
    • 3,415 Thanks
    Dobbibill
    Pay off the interest bearing lending, along with your sister.
    Put the rest into an emergency fund.

    Snowball the payments you would have made on everything into the Sainsbury loan so it is cleared ASAP.
    Some may argue that you could put this amount in savings and stooze but you can be DF sooner if you don't which has been your objective for the past year or so.

    When it's all done - save a 6 month EF so if something happens to your job/health - you have a contingency plan.

    Whatever you decide, all the best.
    I'm a Board Guide on the Energy, Student Money Saving, UK Armed Forces and
    Local Money Saving - Wales boards. I'm a volunteer to help the boards run smoothly, and I can move and merge posts there.
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.


    A person who never made a mistake, never tried anything new.
    • zippygeorgeandben
    • By zippygeorgeandben 5th Sep 17, 11:26 PM
    • 661 Posts
    • 756 Thanks
    zippygeorgeandben
    Thanks so much Dobbibill for the super quick reply. I'm hoping enthusiasticsaver and others might pop along too!
    Are you saying to pay off my sister because a) financially correct decision or b) because she's may sister. I'm thinking she may have received the same sum too.
    Another quick point to make is that £240 comes out of my salary each month for post grad student loan. That's got about £3,000 on it.
    Last edited by zippygeorgeandben; 05-09-2017 at 11:28 PM. Reason: more info
    End Sep 2016 End August 2017
    £8236.57 £4876.49
    (Tesco 4.8%) £222.61pcm
    £6185.75 £851.34 (Zopa 4.0%) £48.99pcm

    £5344.50
    £2890.04 (Sainsburys 0% until 06/19) £140pcm
    £2000.00 £1333.35 (Sister 0%) £133.33pcm

    Total debt
    £19.766.82 £11499.70 Original DFD May 2019.
    • Dobbibill
    • By Dobbibill 6th Sep 17, 6:48 AM
    • 2,288 Posts
    • 3,415 Thanks
    Dobbibill
    !
    Are you saying to pay off my sister because a) financially correct decision or b) because she's may sister. I'm thinking she may have received the same sum too.
    Originally posted by zippygeorgeandben
    b) - because she is your sister so morally rather than financially - she was there for you when you needed it, this opportunity allows you to show you appreciate it

    Hopefully others will come along and add their thoughts in - it's an interesting topic
    I'm a Board Guide on the Energy, Student Money Saving, UK Armed Forces and
    Local Money Saving - Wales boards. I'm a volunteer to help the boards run smoothly, and I can move and merge posts there.
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.


    A person who never made a mistake, never tried anything new.
    • Reb2016
    • By Reb2016 6th Sep 17, 10:22 AM
    • 90 Posts
    • 103 Thanks
    Reb2016
    If it were me I would offer to pay of Sister first and then use the rest on the highest interest rate debt, and put an amount by for an Emergency Fund, so that you don't fall back onto using cards if something unexpected crops up.
    However if I were your Sister I would turn down your payment and tell you to use all of it on the highest interest rate debt, and to pay me back when everything else is cleared.
    The reason I say Sister first, is same as Dobbibill, because this shows you appreciate her helping you out.


    I can understand that you might prefer to pay the higher rate debts back before paying your Sister, so another possible option is to sit down with your Sister explain that you have been given this sum of money, and while you could now pay her back with her agreement you would like to pay the higher rate debts of first, and this would mean you will be able to pay her back quicker as you now have less to pay back in total. If I were your Sister I would be happy with this, as it would mean you were being open and honest with me and would show me you are continuing to take serious action to pay back your debts.


    As Dobbibill says its an interesting topic, and a quite nice dilemma to have, be interesting to hear your decision.


    Reb
    Light bulb moment 6th June 2017 £13333.63 Debt now 12359.94
    DFD was October 2020 40 months now 31st May 2020 33 months Overdraft £450/£2250
    11/17 NSD September 9/4 in a row
    • Mogley
    • By Mogley 6th Sep 17, 12:22 PM
    • 212 Posts
    • 176 Thanks
    Mogley
    I've read through this thread once a couple of months ago. Well done on your achievements thus far.
    Some points from me:
    1) Ensure you've contacted student loans company about your proposed end of payment date. They should suggest setting up a direct debit so that you don't overpay. You can set your own direct debit payment amount. What is your existing and future interest rate? This will determine the payment priority.
    2) I would pay your sister first. This shows you appreciate what she did for you and as soon as you have the money to pay her back in full, you have done so. She will be more willing to help you out in the future.
    3) Clear the interest bearing debts.
    4) Maintain a monthly spending plan to clear the 0% debts within the required promotional time.
    5) Open interest bearing current account(s). Maybe one(s) that has a regular saver attached to it. Deposit any remaining capital you have from the £10k + the £1.5k balance in your existing current account into the interest bearing current account(s).
    6) When and as soon as you get paid each month direct the money you used to pay for debt into regular savings account(s).
    7) Once you have enough saved to cover your debt and six months easy access emergency fund, use these forums to look at other ways in which you can save/invest.

    This time next year you'll be a millionaire. Well not quite but potentially you will know that you will not need to burden yourself with debt again.
    No.25 for 2017 £1070/£4000 saved.
    You should pay attention to the needs of the moment - otherwise there is no future. But to ignore the future is foolish - living solely for the moment leaves nothing for when the next moment arrives.
    • zippygeorgeandben
    • By zippygeorgeandben 6th Sep 17, 9:50 PM
    • 661 Posts
    • 756 Thanks
    zippygeorgeandben
    So don't just stick it all on black then?
    End Sep 2016 End August 2017
    £8236.57 £4876.49
    (Tesco 4.8%) £222.61pcm
    £6185.75 £851.34 (Zopa 4.0%) £48.99pcm

    £5344.50
    £2890.04 (Sainsburys 0% until 06/19) £140pcm
    £2000.00 £1333.35 (Sister 0%) £133.33pcm

    Total debt
    £19.766.82 £11499.70 Original DFD May 2019.
    • zippygeorgeandben
    • By zippygeorgeandben 9th Sep 17, 7:22 PM
    • 661 Posts
    • 756 Thanks
    zippygeorgeandben
    My sister absolutely does not want me to pay her back early. It was an interest free loan from her workplace and she didn't need it so she wondered if I wanted it. She wants me to pay higher bearing interest loans off first.
    I have paid off the whole of the ZOPA loan today, saving £25.
    That's £777 of the £10,000 I received.
    Can I just say a great big thank you to those of you who have posted in my thread, Dobbibill Reb2016 Mogley
    End Sep 2016 End August 2017
    £8236.57 £4876.49
    (Tesco 4.8%) £222.61pcm
    £6185.75 £851.34 (Zopa 4.0%) £48.99pcm

    £5344.50
    £2890.04 (Sainsburys 0% until 06/19) £140pcm
    £2000.00 £1333.35 (Sister 0%) £133.33pcm

    Total debt
    £19.766.82 £11499.70 Original DFD May 2019.
    • Reb2016
    • By Reb2016 9th Sep 17, 8:48 PM
    • 90 Posts
    • 103 Thanks
    Reb2016
    What a lovely Sister you have, and great to hear you have already started on getting rid of some of those debts

    Reb
    Light bulb moment 6th June 2017 £13333.63 Debt now 12359.94
    DFD was October 2020 40 months now 31st May 2020 33 months Overdraft £450/£2250
    11/17 NSD September 9/4 in a row
    • zippygeorgeandben
    • By zippygeorgeandben 15th Sep 17, 10:35 PM
    • 661 Posts
    • 756 Thanks
    zippygeorgeandben
    Hi guys - I've decided to use a large portion of the £10,000 paying off the other interest bearing loan (Tesco) in full. They've given me a settlement figure which includes a rebate of £155.
    So Dobbibill I'm going with what you suggested in your last post (apart from paying sister off) and the payments I would have made monthly to Zopa/Tesco, I'm going to throw at the Sainsburys debt.
    Thank you to all of you and I'll update probably at the end of this month.
    End Sep 2016 End August 2017
    £8236.57 £4876.49
    (Tesco 4.8%) £222.61pcm
    £6185.75 £851.34 (Zopa 4.0%) £48.99pcm

    £5344.50
    £2890.04 (Sainsburys 0% until 06/19) £140pcm
    £2000.00 £1333.35 (Sister 0%) £133.33pcm

    Total debt
    £19.766.82 £11499.70 Original DFD May 2019.
    • Verbatim
    • By Verbatim 16th Sep 17, 7:35 AM
    • 4,485 Posts
    • 12,959 Thanks
    Verbatim
    I know you said you rent. If you're thinking of buying soon you could put some away for a deposit. I agree that using regular saver offers makes sense with the low interest rates on savings elsewhere.
    Great progress.
    CCs @0% £24k Dec 05 £19,621.41 Au £13400 S 12600 Oct £11,981 £9481 £7500 Nov £7250 D £7100 Jan 6950 F £5800 Mar£5400 May £4830 June £4660 July £4460 Aug £3200, S £900, £0 18/9/07 DFW Nerd 042
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