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  • FIRST POST
    • ljj1986
    • By ljj1986 27th Mar 17, 10:49 PM
    • 40Posts
    • 51Thanks
    ljj1986
    Debt free by 2018
    • #1
    • 27th Mar 17, 10:49 PM
    Debt free by 2018 27th Mar 17 at 10:49 PM
    I have been reading through some diaries here for tips and I am so inspired by what I have read that I felt I have to start writing about my own debt free mission. A little background - I am currently a full time mature student and a single parent to one little one, my debt started at its highest point was £12,242.84 which was a mixture of loans and credit cards, this was in May 2016, my debt today stands at £7586.19 which means I have managed to clear £4656.65 worth of debt in less than a year, as you can imagine this is difficult with being a single parent with limited income. I am currently struggling with my mission to become debt free and then begin my journey to saving for a deposit for a house which I want to do around summer 2021. Below is an SOA so any recommendations would be greatly appreciated, I think even though I have managed to overpay on a lot of debt I still have a lot of bad habits that need breaking!

    [font=courier new]Statement of Affairs and Personal Balance Sheet[b]

    Household Information
    Number of adults in household........... 1
    Number of children in household......... 1
    Number of cars owned.................... 1

    Monthly Income Details
    Monthly income after tax................ 870 (Student loan)
    Partners monthly income after tax....... 0
    Benefits................................ 562
    Other income............................ 0
    Total monthly income.................... 1432

    Monthly Expense Details
    Mortgage................................ 0
    Secured/HP loan repayments.............. 0
    Rent.................................... 580
    Management charge (leasehold property).. 0
    Council tax............................. 0
    Electricity............................. 35
    Gas..................................... 15
    Oil..................................... 0
    Water rates............................. 2
    Telephone (land line)................... 0
    Mobile phone............................ 36.5
    TV Licence.............................. 0
    Satellite/Cable TV...................... 0
    Internet Services....................... 19
    Groceries etc. ......................... 140
    Clothing................................ 10
    Petrol/diesel........................... 50
    Road tax................................ 0
    Car Insurance........................... 35
    Car maintenance (including MOT)......... 10
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 0
    Other child related expenses............ 27
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 0
    Buildings insurance..................... 0
    Contents insurance...................... 6.5
    Life assurance ......................... 0
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 70
    Haircuts................................ 0
    Entertainment........................... 50
    Holiday................................. 10
    Emergency fund.......................... 0
    Total monthly expenses.................. 1096

    Assets
    Cash.................................... 3400 This is a help to buy ISA which I really do not want to touch as the government bonus makes it worth keeping
    House value (Gross)..................... 0
    Shares and bonds........................ 0
    Car(s).................................. 6000
    Other assets............................ 0
    Total Assets............................ 9400

    No Secured nor Hire Purchase Debts

    Unsecured Debts
    Description....................Debt......Monthly.. .APR
    Car Loan.......................3160.69...140.......3.5 Current end date 15/04/19
    Loan...........................3039.13...154...... .3.5 Current end date 01/12/18
    Credit Card....................1300......35........0 (0% until Nov 17 when it could be moved to a 0% overdraft if not paid off)
    Total unsecured debts..........7499.82...329.......

    Monthly Budget Summary
    Total monthly income.................... 1,432
    Expenses (including HP & secured debts). 1,096
    Available for debt repayments........... 336
    Monthly UNsecured debt repayments....... 329
    Amount left after debt repayments....... 7


    Personal Balance Sheet Summary
    Total assets (things you own)........... 9,400
    Total HP & Secured debt................. -0
    Total Unsecured debt.................... -7,499.82
    Net Assets.............................. 1,900.18

    Created using the SOA calculator at stoozing
    Reproduced on Moneysavingexpert with permission, using other browser.
Page 2
    • ljj1986
    • By ljj1986 3rd May 17, 10:48 AM
    • 40 Posts
    • 51 Thanks
    ljj1986
    Update on debt totals:

    Loan 1: £2763.77
    Loan 2: £3055.14
    0% Card: £1404.15

    Total: £7223.06

    Hasn't come down much although I do have almost £300 in my emergency/debt repayment pot which I will be sending over to the 0% card once my finances have been sorted out, hopefully this will be done over the next few weeks.
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • ljj1986
    • By ljj1986 15th May 17, 10:29 AM
    • 40 Posts
    • 51 Thanks
    ljj1986
    I've made my first extra payment today to bring me below the £7k mark! Debt currently stands as follows:

    Loan 1: 2763.77
    Loan 2: 2915.19
    0% card: 1304.15
    Total: 6983.11

    Slowly but surely heading in the right direction!
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • ljj1986
    • By ljj1986 1st Jun 17, 9:04 AM
    • 40 Posts
    • 51 Thanks
    ljj1986
    Well I made it through May with my pots mostly in tact, I did overspend in my food budget, I think this is going to be a difficult area for me to change and I don't want to focus on cutting it down too much as I think this will have a negative impact, the overspend was around £50 for the month. I will work on this gradually and will also try to meal plan a lot more and actually stick to it.

    Looking at the positives, I have reduced my debt by over £700 in 2 months and still have a (small) pot to still go towards debt repayments, once I am back on my ebay selling I will send this over to my card.
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • csarina2
    • By csarina2 1st Jun 17, 11:02 AM
    • 1,585 Posts
    • 14,316 Thanks
    csarina2
    If you can you would be better sending extra cash to your loans, you pay interest on those and not on your 0% deal, try and pay just over the minimum on your 0% it will come down, but once the two loans are paid off you can chuck money at the 0% deal.
    • C.M.
    • By C.M. 1st Jun 17, 12:33 PM
    • 47 Posts
    • 95 Thanks
    C.M.
    I think the OP said the 0% is going to end in 6 months....so I think she is trying to get it paid off before then, henCeri the over payments!

    Despite the food budget going over, you've done really well tonpay down that much on such a limited income!
    • ljj1986
    • By ljj1986 11th Jun 17, 5:42 PM
    • 40 Posts
    • 51 Thanks
    ljj1986
    If you can you would be better sending extra cash to your loans, you pay interest on those and not on your 0% deal, try and pay just over the minimum on your 0% it will come down, but once the two loans are paid off you can chuck money at the 0% deal.
    Originally posted by csarina2
    I think the OP said the 0% is going to end in 6 months....so I think she is trying to get it paid off before then, henCeri the over payments!

    Despite the food budget going over, you've done really well tonpay down that much on such a limited income!
    Originally posted by C.M.
    Sorry I have only just seen these replies, thank you both so much for your input, sometimes I feel like I am just telling myself stuff that I already know although putting it here does keep me on track regardless.

    You are right C.M, my 0% deal finishes in October so I am trying to clear it by then and my interest rates on both loans are not too bad, I will start overpaying on these once my card is cleared although I know I get a small penalty for overpaying as I previously made an overpayment on one of them when I had some spare cash.

    Thank you so much C.M, I am determined to clear everything as soon as I can as I am trying my hardest to save for a deposit for a house but I know I can't do this until I have cleared my debt. I have just made another overpayment today but will do another post below.
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • ljj1986
    • By ljj1986 11th Jun 17, 5:46 PM
    • 40 Posts
    • 51 Thanks
    ljj1986
    Well I have just made my second overpayment, this time to bring my debt to below the £6500 mark! I am feeling proud of myself so far and I'm feeling much more focused now that my finances have settled. New figures:

    Loan 1: £2626.78
    Loan 2: £2793.31
    CC (0% until Oct): £1079.25
    Total: £6499.34
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • enthusiasticsaver
    • By enthusiasticsaver 11th Jun 17, 7:14 PM
    • 3,678 Posts
    • 6,616 Thanks
    enthusiasticsaver
    Excellent progress to almost pay off 50% debt in just over a year. How long until you graduate and are you able to do some part time work to boost your income? I would also put some money into emergency savings each month or towards your car insurance so you can pay it off in full.

    The gifts figure is quite high. That is almost £780 per year. Is that for birthdays and Christmas and can you cut down the number of people you buy for? We only buy for immediate family now. Just our daughters, each other, son in law, my brother, granddaughter and a small something for my mum and stepdad. It has made Christmas so much easier now I don't have to think what to get my niece and nephew who we hardly see and are now late teens, early twenties and my sister is pleased she no longer has to buy for our daughters and just buys for my granddaughter.
    Debt and mortgage free and saving for early retirement
    • ljj1986
    • By ljj1986 11th Jun 17, 8:11 PM
    • 40 Posts
    • 51 Thanks
    ljj1986
    Excellent progress to almost pay off 50% debt in just over a year. How long until you graduate and are you able to do some part time work to boost your income? I would also put some money into emergency savings each month or towards your car insurance so you can pay it off in full.

    The gifts figure is quite high. That is almost £780 per year. Is that for birthdays and Christmas and can you cut down the number of people you buy for? We only buy for immediate family now. Just our daughters, each other, son in law, my brother, granddaughter and a small something for my mum and stepdad. It has made Christmas so much easier now I don't have to think what to get my niece and nephew who we hardly see and are now late teens, early twenties and my sister is pleased she no longer has to buy for our daughters and just buys for my granddaughter.
    Originally posted by enthusiasticsaver
    Thank you for taking the time to reply. I have a couple of years yet, I don't think it would work out much better financially to work part time and it would also take time away from my LO as I would have to work in the evenings. I considered going back to work over the summer as my old workplace would happily take me back but I've decided instead to enjoy the summer with LO before he starts school full time in September, some things just aren't worth losing regardless of the money.

    The gifts figure is for absolutely everything, birthdays, christmas, mothers and fathers day, easter, including cards and gift wrap etc. I'm not sure if I can cut this down but it is certainly something I will look at. I already have around £200 in my Christmas pot and I have £300 in my car insurance pot, the monthly figure is savings to pay it off annually as I did this last year.
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • ljj1986
    • By ljj1986 12th Jun 17, 6:15 PM
    • 40 Posts
    • 51 Thanks
    ljj1986
    So today, instead of going to do my big shop and spending around £50 I went to my local shop and spent £12. Along with what I already have in the freezer this should last me 3/4 days rather than £50 lasting me 7 days. Tonight I am going to write out a meal plan for the week and pick up any other bits. My food pot is actually looking quite healthy and I may even have some left to transfer over to debts at the end of the month.
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • ljj1986
    • By ljj1986 13th Jun 17, 6:47 PM
    • 40 Posts
    • 51 Thanks
    ljj1986
    NSD today, going to have an ebay clearing spree over the next few days as I have had tons of stuff sitting in the spare room for a while that I need shifting! Hopefully it should all bring in some extra money to put towards my card, determined to get that below the £1000 mark by the end of this month.

    I have some money in a holiday pot which is to be used for a holiday with one of my best friends celebrating our birthdays but this has now been postponed, I'm tempted to send it over to my card but I don't know how long it will be postponed just yet, I might reassign it to my emergency pot which will then make me work a little harder to find the holiday money from other things (ebay for example) as any extra funds I have get distributed between various pots.
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • enthusiasticsaver
    • By enthusiasticsaver 13th Jun 17, 6:54 PM
    • 3,678 Posts
    • 6,616 Thanks
    enthusiasticsaver
    I am glad the pots system works for you. It always did for me too and I knew if I overspent on one pot I could take it from another. I use clear checkbook (this is free) which uses the envelope system like YNAB but I think it is simpler and does not take as much time to get to grips with.

    Once the debt is gone you will soon save up that house deposit.
    Debt and mortgage free and saving for early retirement
    • ljj1986
    • By ljj1986 13th Jun 17, 7:02 PM
    • 40 Posts
    • 51 Thanks
    ljj1986
    I am glad the pots system works for you. It always did for me too and I knew if I overspent on one pot I could take it from another. I use clear checkbook (this is free) which uses the envelope system like YNAB but I think it is simpler and does not take as much time to get to grips with.

    Once the debt is gone you will soon save up that house deposit.
    Originally posted by enthusiasticsaver
    I love the pots system, gives me the flexibility of adding to my personal pot for the rare treat. I've just created my own spreadsheets on excel, I absolutely love my spreadsheets! I have right from 2017 through to 2021 spends when I am aiming to buy my house! I will have a look into checkbook though, thanks for the tip.

    I currently have £3600 in my help to buy ISA so will get 25% bonus from the government on that too, I've also restarted my monthly transfers over so trying to clear debts whilst also saving £200 a month where I can, if I get desperate then I know I have that to fall back on but I know I won't touch it being in there unless I absolutely have to.
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • enthusiasticsaver
    • By enthusiasticsaver 13th Jun 17, 7:09 PM
    • 3,678 Posts
    • 6,616 Thanks
    enthusiasticsaver
    I love spreadsheets too. I have one for savings (projections) and one for pensions and update them yearly and one where I record our yearly spends on each category(pot) which was useful when planning retirement so I knew how much we needed to get from our pensions/savings.

    You seem so organised and great discipline to have a help to buy isa but not touch it. Normally people say use savings to pay off debt but I think Help to Buy is different because of the government incentive. As your loans are on a low interest rate and credit card 0% then it makes sense to keep it separate for now.
    Debt and mortgage free and saving for early retirement
    • ljj1986
    • By ljj1986 13th Jun 17, 7:17 PM
    • 40 Posts
    • 51 Thanks
    ljj1986
    I love spreadsheets too. I have one for savings (projections) and one for pensions and update them yearly and one where I record our yearly spends on each category(pot) which was useful when planning retirement so I knew how much we needed to get from our pensions/savings.

    You seem so organised and great discipline to have a help to buy isa but not touch it. Normally people say use savings to pay off debt but I think Help to Buy is different because of the government incentive. As your loans are on a low interest rate and credit card 0% then it makes sense to keep it separate for now.
    Originally posted by enthusiasticsaver
    Thank you, I'm just so determined to get out of rented accommodation (if I can get a mortgage on my own) and I know I am going to need a huge deposit. With the government incentive and at around 3% interest I don't feel that it makes any sense using it towards debts, I also wouldn't be able to reach the maximum of £12k to get £3k bonus if I transferred it to my debts with the limits on the account.

    You sound much more organised than me, I seriously need to start thinking about a pension, I have absolutely nothing in place for that at the moment
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • ljj1986
    • By ljj1986 20th Jun 17, 8:44 PM
    • 40 Posts
    • 51 Thanks
    ljj1986
    Well I have had to take £85 from my car pot that was being saved for my insurance due in September thanks to a minor problem with my car, going to have to get on with selling to try and replenish this. Next year I will have much more time to save the whole premium as it will be the full year rather than part way through.

    Food/groceries budget will go over again, I think I am going to have to admit that this pot just has to be a little bigger than I would like and see where I can make changes elsewhere although I have been buying extra bits for picnics that I wouldn't usually buy. I think this is completely because I'm not planning in that department, I start with good intentions but I just cannot stick to a meal plan!
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • ljj1986
    • By ljj1986 28th Jun 17, 12:11 PM
    • 40 Posts
    • 51 Thanks
    ljj1986
    Dug out my paperwork for my card, can anyone clarify if the account began in April 2016 and it states 0% for 19 months would this mean my balance would need to be cleared by the same date in November or December?

    No big updates although I am getting a lot of clarity on my spending, people say all the time how little things add up but tracking every single penny with my pot system really shows me just how much. I have had to amend a couple of pots as I was a little too ambitious initially and after a couple of months both my food and fuel for my car pot were running at a minus so I have adjusted these. My target for July is to work on the amount I spend on food, I have put in an order for meat which should arrive Friday to last throughout the whole of July so I should only need to buy fruit, veg and milk, I am considering putting a weekly order in for these too as then I wouldn't have to go to the store ever which I think is my downfall as I start thinking about other things I might need.
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • ljj1986
    • By ljj1986 28th Jun 17, 8:15 PM
    • 40 Posts
    • 51 Thanks
    ljj1986
    Feeling proud of myself today, used one of my credit cards for a couple of things a few days ago and instead of leaving it there and thinking 'oh I will pay it next month' or 'oh a little more won't hurt and I'll sort it out along with the rest of my debt payments' I actually took the amounts from each related pot and paid it all off. Feeling like I am in a much better place at the moment even with my overspends with a couple of things.
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
    • ljj1986
    • By ljj1986 11th Jul 17, 12:07 PM
    • 40 Posts
    • 51 Thanks
    ljj1986
    Have been off a little over the last week and so a little damage has been done on my credit card, I am waiting on one thing to clear so I can report figures.

    I am back at it today though, I have another card which I don't currently use which I received a balance transfer offer for, 0% until April 2019 with a 2.9% fee. My credit limit was fairly low on this card, I have just managed to increase it so that I can transfer my whole balance across once I have my final figure in a day or two. This will incur a fee of around the £30 mark but with overpayments to my loan now possible I should be able to get this back from savings on my interest on my loans. Worst case scenario, I don't make overpayments but won't have to worry about paying money back by November at a relatively small cost.

    Will report debt figures at some point in the next few days.
    LBM 15/03/17=£7586.01 DFD April 2019.Debt Today: £6499.34 (DFD Apr 19)
    Target £0 Debt by Dec 2018 Highest debt: £12,242.84 (May16)
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