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Debt Free for next xmas

Hello!

Ive decided to post my income and outgoings as a spur to myself to get debt free and to field a bit of advice too. Im posting my personal budget so the household expenses etc are halved (mostly, some are my bills only like pet insurance) because the boyf is finding a job to contribute his half. Some of the bills are approximates as I still havent had the quarterlies from some and will amend as appropriate when they come in.

INCOME:

Approx £1100 per month inc overtime etc
WTC - £66 per month (will end when boyf gets job)


OUTGOING (monthly figures):

Rent: £237.50
Council tax: £48.50
Gas (Monthly DD) £6.00
Electricity: £10.00
Water: £10.00
Pet Insurance £5.45
Car Insurance £20.00
Telewest: £34.00
Food budget £75.00
Charity Donation £4.00
Travel (bus) £65.00
PAYG Mobile £3.00 per month approx spend

Total £518.45


OTHER

Credit card Balance £300.00 Pay in Full every month
Next Account £350.56 Sending £50 per month
Overdraft (0%) £2000.00 Till June 2006, then £1500 0%

I have to confirm with the bank, but the overdraft either reduces to £1500 in June 2006, £1000 in June 2007 or seems like there is the option of a 0% loan for £2000 which would need to be taken in June 2006. I was thinking it would actually make sense to start saving money now in a high interest account and then pay in £500 before June, and the same again for June 2007 as I would make money off it, but then again, clearing the OD and having a fixed loan is also attractive. Im not sure which I will take, but will need to confirm with the bank anyway. I dont feel the urgency to pay this off fast as its at 0%.

Id like to reduce the reliance on the credit card too, I had to increase the balance from £150 to £300 at the beginning of December and would like to reduce the limit by spending less on it each month then reducing the limit when its at £150.00 - and Intend to always pay the full balance from this month onwards (ive only ever not paid in full 1 time over the last 6 months). Once its down to £150 id like to spend less on it to get the balance to 0 then keep it as an emergency only card.

Im making more than minimum payments on the Next account, which is 10% of the balance, and Id like to increase it and clear the whole balance by summer at the latest, as the interest is quite high (not sure how much but I think its the usual store card apr around 29% - so Im keen to pay this off quick!


TV Licence - Paid 1yr in advance - renewal in October
Car Tax - Due end of May 2006
Car Insurance Renewal - Due October 2006
MOT due late December 2006

Id like to start saving in advance for these so I can earn interest on the money in the account and pay in full so that there is no 'credit charge', or scrabbling around for money!

Aside from that, I get an annual bonus in July 2006 which should be around £800 which I would like to invest, so I would like to get some extra money saved so that I would have around £1000 to invest to start with and add to it monthly (thinking of Unit Trusts). I think it would be worth not saving for this until things like the Next account are paid off - maximising debt repayments now and then save the equivalent amount for investing later in the year.

Have I forgotten anything?? Any thoughts or comments appreciated!

Jo xx
#KiamaHouse

Comments

  • brummiebabe
    brummiebabe Posts: 1,894 Forumite
    Hi there!

    From reading your figures (maybe I'm reading them wrong?) don't you have:

    Income £1166
    Outgoings £518.45 + £300 (to credit card) + £50.00 (NEXT) = £868.45
    LEFTOVER TO THROW AT DEBTS £297.55?

    You also appear to have an overdraft of ?£2000 (as I said, not sure if I'm understanding your details correctly!) but at 0%, surely that should be paid after the debts incurring interest (ie NEXT!!!) Also, couldn't you transfer the NEXT balance to a 0% balance transfer card??

    As for your bonus in June/July - woudn't it be better to clear your debts rather than invest it?????

    Don't know if any of that helps (or makes much sense)!!!!
    20p Saver Club #33 60p/£100
    Christmas Saving £0/£1300

    Saving Target 2014 £25/£1000
  • Yorkielass
    Yorkielass Posts: 2,235 Forumite
    Part of the Furniture Combo Breaker
    Glad to see you're starting to get things sorted and are writing down your outgoings - just a couple of things looking at your list - hope you don't mind.

    Do you get a monthly ticket on the bus? Just seems quite a lot for a monthly ticket but guess it depends where you live.

    You haven't budgeted for clothes, gifts, household items etc - I notice reading your daily posts on OS that you've been buying household stuff a lot - I know you've moved in to a new place so have probably had lots more to buy this year but would it be good to set yourself some limits for these.

    Partly why I say that is your expenditure on your budget you've posted is only half of what you earn - do you know where the other half goes?
    Initial Mortgage January 2024 - £160,000
    Initial Mortgage free date - January 2058
    Mortgage as of 1st February 2024 - £159,134.98
    Overpayments to date - £79.62
    Current Mortgage free date - January 2058
  • “Id like to reduce the reliance on the credit card too…… Once its down to £150 id like to spend less on it to get the balance to 0 then keep it as an emergency only card.”

    Hello JW1096,

    On the whole, your accounts look really quite good - well done. I thought I would just pop in a comment about the dreaded Credit Card Beast. I would strongly urge you to get out a very large pair of scissors and cut it up into very small pieces. Cross my heart it will be one of the best things you do. Temptation has been removed…Alleluia Brothers and Sisters – hee hee :p

    Seriously though, just rely on cash and your cheque book – Easy Peasy. It becomes second nature after a very, very short space of time with the added bonus that you’ll find some of the spending you normally put on the card is drastically reduced.

    As for emergencies… well, people had emergencies before Credit Cards were invented. I rest my case.. lol. :rolleyes:
    :)The £2 Coin Savers Club = £346.00 (£300.00 transferred to Savings a/c)

    :)"Some days you're a Pigeon...some days you're a Statue"
  • BWZN93
    BWZN93 Posts: 2,182 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    I knew id forgotten some things! (I was making chicken stock and got sidetracked :rolleyes: )

    At the Mo - Gifts are nil (no kids, just a boyf and a couple of friends and we dont buy for each other as they are still students, Mum gets gift vouchers I normally get as a bonus from work, as does sister and none have birthdays till at least October)

    The Bus ticket is for 31 days and is £65 for both zones 1 & 2 - I live in Bristol and they just put the fares up from £57 to £65 grrrrrrr

    The other half of my income has (since september) been paying some of the bills and food in total by myself for the two of us, getting my car back on the road, buying furniture and house stuff etc etc, and buying clothes (I did a sweep of the Next sales so I dont need to buy till summer!)

    I posted today because the boyf is now getting a job and is totally responsible for his half of the bills from January, and the house is almost complete - I only need a few more things which will be in the region of £400 total, which I intend to buy a portion of each month with any residual income.

    Paying off the debts isnt the problem, deciding how quickly to do it is! The overdraft is the one that has me flummoxed though, im not sure whether to go for the 0% loan option or save money each month for when the overdraft 0% limit comes down. I think Ill attempt to throw any residual income at the Next account (maybe increase payments to £100 per month), whilst reduce cc usage by £50 per month, and save for repaying the overdraft.

    My (revised) budget is as follows

    Rent: £237.50
    Council tax: £48.50
    Gas (Monthly DD) £6.00
    Electricity: £10.00
    Water: £10.00
    Pet Insurance £5.45
    Car Insurance £20.00
    Telewest: £34.00
    Food budget £75.00 (inc cleaning, lunches etc)
    Charity Donation £4.00
    Travel (bus) £65.00
    PAYG Mobile £3.00 per month approx spend
    Clothes: £0.00
    Gifts: £5.00
    Next Account: £70.00
    Saving for Overdraft reduction in June: £85.00
    Credit Card: £300.00
    Furniture etc: 100.00

    Total £1078.45

    That leaves me with:

    £87.55 in current account as cash
    £250.00 on credit card (spending £50 less to reduce balance)

    This is usually spent on things like petrol (approx £15 a month), maybe a haircut, a few shop bought lunches and my smokes ( I know its a bad habit but im not quitting yet, I cant hack the stress and it is my only vice as I dont drink and hate clubs/bars/pubs etc). Socialising money isnt needed either, all my freinds prefer to visit and I cook dinner.

    Ive had a look at my statements for the CC and current account and the last few months has been spent on rent/bills/food/furniture, and my actual spend on these shall reduce because of the boyf now contributing.

    SO:

    CC at £150 balance by end of March
    Next Account paid off by End of May
    Enough saved by End of June to reduce overdraft by £500

    meaning:

    Work bonus can be saved for the next overdraft reduction of £500 in June 2007
    From June onwards I can save for gifts/xmas/holiday in 2007!

    Does that seem right??

    Jo xx
    #KiamaHouse
  • Hi jw...

    No holiday budget???
    Try the south beach to lose 2 st.
    A beach holiday could give you the motivation boost :-)

    :-)
    :p:p:pBargain Babe-a-Licious! :p:p:p
  • skintchick
    skintchick Posts: 15,114 Forumite
    Debt-free and Proud!
    No! Don;t go on holiday while you have debts - you can't afford it. Chuck all spare cash at your debt. (I haven;t had a holiday that I have paid for (thanks to lovely parents for a couple of hols) since, erm, 1997!!! Blimey, didn;t realise it had been that long!!!
    :cool: DFW Nerd Club member 023...DFD 9.2.2007 :cool:
    :heartpuls married 21 6 08 :A Angel babies' birth dates 3.10.08 * 4.3.11 * 11.11.11 * 17.3.12 * 2.7.12 :heart2: My live baby's birth date 22 7 09 :heart2: I'm due another baby at the end of July 2014! :j
  • jw1096 wrote:
    my smokes ( I know its a bad habit but im not quitting yet, I cant hack the stress and it is my only vice as I dont drink and hate clubs/bars/pubs etc). Socialising money isnt needed either, all my freinds prefer to visit and I cook dinner.


    Ok I'm a non-smoker so I shall try not to get on my soapbox but my GF stopped smoking and couldn't believe how much money she saved. It really is unbelieveable!!

    When your friends visit, do they bring ingredients/puddings etc. If not, suggest they do this and then everyone can contribute, otherwise you are paying for ingredients, gas and electricity and if you are the only one that does it then it isnt fair.
  • skintchick
    skintchick Posts: 15,114 Forumite
    Debt-free and Proud!
    YEs, do a bring and share meal, where everyone brings something towards it. You can even tell them what to bring ie starter, veggies, dessert, drinks.
    :cool: DFW Nerd Club member 023...DFD 9.2.2007 :cool:
    :heartpuls married 21 6 08 :A Angel babies' birth dates 3.10.08 * 4.3.11 * 11.11.11 * 17.3.12 * 2.7.12 :heart2: My live baby's birth date 22 7 09 :heart2: I'm due another baby at the end of July 2014! :j
  • This is my first post, and I thought I would just wish you (and everyone else out there) the very best of wishes in your efforts.
    The problems of the world cannot possibly be solved by skeptics(sic) or cynics whose horizons are limited by the obvious realities. We need men who can dream of things that never were.
    ***JFK***
  • r-world
    r-world Posts: 23 Forumite
    This is usually spent on things like petrol (approx £15 a month), maybe a haircut, a few shop bought lunches and my smokes ( I know its a bad habit but im not quitting yet, I cant hack the stress and it is my only vice as I dont drink and hate clubs/bars/pubs etc).

    I'm guessing you'll probably get a few more comments relating to above.

    I have high 5 figure debts and quit smoking in August after almost 20yrs. I'm the original fag ash lil so even considering life without smoking was life without both hands. However I went to a hypnotherapist which cost me £95 and haven't looked back since. I told the hypno that I was quitting only for financial reasons and he said that was good enough!

    With £50 per week going on fags, I leave it to you to work out how much I've saved.
    Saving Nectar points for long-haul flights - total as of Jan '07= 54,000+ :T
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