On a mission to free myself of debt...

Exerbusi

Hello all!

This is my first time posting on this forum, although I have been a site reader for a while.

I have accumulated approx £8000 worth of debt over the years. Most of this is from worthwhile purchases (car, computer etc), but still the thought of it gets me down.

I work in an industry that allows me to earm on top of my salary, meaning I can benefit from extra money I wouldn't otherwise have. Although this is nice, it isn't something I can rely on given the current financial climate!

My situtation is simple - I earn OK money, but my outgoings are such that I have barely anything left at the end of the month. I need to streamline my outgoings so I can chip away at the debt. My goal is clear - I want to be able to buy a house within a couple of years!

This seems the best place to chat with like-minded people and gain inspiration from those who have achieved similar goals to mine!

My first step is to get the ball rolling with the bank-charges issue. I have downloaded the letter and intend to send it off next week!

Any advice is hugely appreciated!

Thanks

Exerbusi

Exerbusi

Additional info...

£2300 on a credit card
£4400 loan
£1200 overdraft

skint_spice

Hello and Welcom. Have you tried working out a SOA? http://www.makesenseofcards.com/soacalc.html even if you don't want to post it may still help you work out your income/expenditure.

Exerbusi

Thanks for the site - was very helpful.

I can scale down my spending easily enough, the next stage would be to improve the deals I have with the banks. My relative inexperience with banks and their products have left me reluctant to change as yet, whilst I learn more thanks to this site.

I am unsure about my credit rating, as I have gone over my overdraft limit fairly regularly and have missed 3 credit card payments. Ironically this is not down to me not having the money to pay - it was just bad organisation on my part. As a result of these silly mistakes, my credit rating is probably poor. I have now automated my credit card payments to avoid this in future.

On the plus side, I only have one credit card, loan and overdraft so it might not all be bad news with regards to my credit rating. I have never missed a loan payment and my overall debt it modest in comparison to some.

I may apply for better deals on my overdraft, loan and credit card anyway, just to see the results. If I could get a long term 0% on my credit card and reduce my monthly loan repayments I would be setting myself up for a much better financial position.

Has anyone with poor credit (I am assuming my credit is poor, it may not be so bad!) ever done a similar thing - balance transfered cards and changed loan and overdraft providers for better deals?

I am sorry if I am asking silly questions - I am new to all of this money saving lark!

Happytogetdebtfree

I have a poor credit and alot more debt, i am unable to get 0% on credit cards but just recently switched from halifax to alliance and leciester...0% overdraft although they have not matched my overdraft yet but they will be giving us a 100 pound cash back for signing up with them and keeping the balance open for 15 weeks hello and welcome to the boards i am on night duty

Exerbusi

Hi!

Was the overdraft switching a difficult process? When you say they haven't matched it yet, how do you mean? They haven't matched the interest rate or the size of the overdraft?

Piquant_2

I don't know the answers to many of your questions, sorry!!

When I applied for an A&L account, they matched my overdraft facility after seeing my previous bank statement, I had confirmation within a week.

Hope this helps

Exerbusi

May be worth it.

I think I will search this site for information on the best loan rates and overdraft rates, and go into the banks, just to speak to somebody and see what they say to me.

By reducing my monthly interest, yet still making payments I should be able to really eat into my debts quite quickly. I am hoping in a few weeks to be able to stop a large outgoing each month over which I have little control. Once that is taken care of my financial picture is much, much brighter!

There is talk of a promotion at work for me too, which would come with a nice pay rise!

Things are looking up!

Does anyone have any banks they would reccommend? I am with HSBC and find them OK, but they dont have the most competetive rates on the market.

Exerbusi

Well, my money saving day has been as follows...

1. I have roasted a chicken and retrieved all of the meat I possibly could - I have a degree in physiology yet was surprised at the little pockets of meat I had no idea existed! I managed to get so much meat from the thing I was left with a glowing white carcass! It is now in a stock pot forming the basis for the next few meals!

2. I have researched the best options available to me, and think I will speak to the people at Alliance and Leicester and see if they will allow me to swap my bank account over to them. I get paid on the 14th so will do it the Monday after.

Does anyone have any experience of dealing with them? Are they a good company?

3. My next step is to structure my menu for the week, so I don't waste any food. I will also make sure I organise my work appointments so I don't waste petrol!

4. I will look again at my outgoings and see where I can cut them down, hopefully to save perhaps £100 per month!

Exciting!

Exerbusi

So...

I called HSBC about my loan insurance, and they took it off! That has saved me £311.54 over the course of my payments! It also means my payments have been reduced by £11 per month - doesn't sound like much, but again it adds up!

Unfortunately they couldn't help me with my credit card really, other than reduce my interest to 4.9% APR for 6 months. That would be OK, but it means the APR is back up to 15.9% after that period. The shocking thing is that I currently pay 19.9%! Oh. My. God. I thought I was on 15.9%.

I want to do a 0% balance transfer, but am worried about my credit rating. The good news however is the lady on the phone told me I sailed through the credit scoring HSBC use for assessing their loan applicants! That has inspired me to look around for a good 0% deal, which would really boost my debt-free mission!

I would be able to pay £100 per month on the credit card, really eating into my debt like a fatty at a banquet.

Another step is to remove the insurance from my phone bill - that is £6 per month.

So, not including my upcoming balance transfer (fingers crossed), I will have saved myself a small fortune each month by...

Removing my loan protection (£11)
Stopping buying lunch at work (monthly average of £50)
Removing my phone insurance (£6)

I will find out how much my account costs me per month and change it to a fee-free account.

Watch this space!

racer256

Alliance & Leicester are quite good, I have the Internet Banking and am on it everyday! The interest on their savings account is shocking though. Avoid that! Try setting it up on Quidco where you will get cashback, more money to the Credit Card! Best of Luck.