Some Good News

youngandreckless

Hi All,

As my previous postings have shown, my debt has gone up over the months, not down......Until this month! My debt:

o/d was £900! Now £850
Loan was £7000 Now £6865.61

£184.39 paid off.

A small step in the right direction, but this ensures I've got funds for Xmas pressies and a couple of bdays imminent. Paying off what I can without a total compromise on life until January means I should see out xmas with my debt still going down and thats my short term aim.
After Xmas I should be able to bump up my debt paying money to around £300 to get rid of the overdraft, then I can stash as much in savings as possible to get rid of the loan. At the very least savings will mean that anything that crops up can be dealt with without the overdraft...
Onwards and upwards!!

gizmoleeds

youngandreckless wrote:

Onwards and upwards!!

Surely, downwards... :rolleyes:

tattooed_lady

Well done, every single penny paid towards your debt helps!

youngandreckless

Thanks, you're right...downwards!!
I've been online to start bday and xmas shopping, already saved £20 by getting stuff online. My friends and family know that they're only going to get a little something this year and the good thing is that by me being honest and saying I'm tight on funds, quite a few have said me too and we've agreed not to spend a great deal!

tattooed_lady

Totally agree with the Xmas prezzie issue. Our family have only bought for the kids for a long time now as most of us can't afford it! I have even agreed with a good friend this year not to buy for each others kids as she is moving and is short of cash, and we usually just end up buying the same things anyway!

southernscouser

youngandreckless wrote:

After Xmas I should be able to bump up my debt paying money to around £300 to get rid of the overdraft, then I can stash as much in savings as possible to get rid of the loan. At the very least savings will mean that anything that crops up can be dealt with without the overdraft...

Well done. :T

However generally speaking, saving money when your in debt isn't the best way to go about things. The interest you receive from your savings might only be 5% and the interest you pay on your loan might be 8%. Then you are 3% down!

I understand you may want to have some money for a rainy day which isn't a bad idea but when you think you have enough rather than saving it and paying off lumps, pay off extra each month!

CTT_2

Chalres forte of Trust House Forte fame once said if you have debts you should have no savings. I suppose he was right especially if you are getting 5 percent on savings and the interest on debt is more.

$17mma

southernscouser wrote:

Well done. :T

However generally speaking, saving money when your in debt isn't the best way to go about things. The interest you receive from your savings might only be 5% and the interest you pay on your loan might be 8%. Then you are 3% down!

I understand you may want to have some money for a rainy day which isn't a bad idea but when you think you have enough rather than saving it and paying off lumps, pay off extra each month!

I agree Southernscouser and was about to advise the same..

Ditch the savings .. well not literally.. but bung it on the debt and your debt free date will be closer..

johannamse

Might be a loan that cannot except overpayments. Therefore will have to save, in order to pay off.

$17mma

johannamse wrote:

Might be a loan that cannot except overpayments. Therefore will have to save, in order to pay off.

True never thought about that.. he/she will pay a penalty if he/she pays it off early.. but if the penalty is cheaper than the interest for the term of the loan then it would be worth it..or maybe there is a penalty date or amount and once you go past that it will be ok..

youngandreckless

Hi All,

Good points that you've made. My plan is to shift overdraft first as that isn't doing me any good - its mentally draining and I don't want the bank to see me in the minus month after month.
My loan is a 5.9% fixed loan with Cahoot. I need to save a buffer at the very least for three or four months so that when car tax, MOT etc etc and all the odds and ends that inevitably pop up happen I'm prepared. But I hear what you're saying about saving long term when a debt is hanging over your head - does seem a bit silly! I think I'll transfer the loan to flexible once my odraft and buffer are sorted and then can overpay to my hearts content.
What do you think? I took my loan from flexible to fixed as I was abusing it - ie withdrawing more money and defeating the object, but I'm definately in a better frame of mind now. Ideally I'd like to be as debt free as possible when I finish my college course in 18 months time. In two or three years time I'll be earning a decent wage, but I know the first year in my new job at least there is a possible lower salary - although I can do work at home aswell to top up my money.
Sorry to ramble! I am trying hard to keep my new debt free life with a great new career in mind with my decisions, as this has been the best motivating force to keep me on the straight and narrow!
Y&R x