HALF WAY MARK! (nearly)

turbo.jet

Hi Everyone,

Usual story, long time reader, first time poster.

I came to the UK 7 years ago and almost immediately became a victim of the ease at which its possible to get in to debt. I had a £15,000 line of credit available to me from my bank within months of arriving, despite being a temp earning £6 an hour. My £2,000 loan for a car was consolidated over and over to incorporate my credit card balances which I'd then run up again after a while. I woke up to myself after my debts hit, at their peak, (and I have never calculated the actual total - its too scary) ~£20k.

This awakening occurred in March 2008 and as of today (payday) I have managed to pay off £9k already:beer:. To achieve this, I worked a 2nd job for 3 months to get me started, reduced my outgoings by moving to a cheaper flat and selling my car, reclaimed £1650 in bank fees and have been fortunate enough to build my career to the point where my salary is now decent, and I can live within my means.

I have to say the most effective driver for my turnaround was none of these actions, it was changing my understanding of what credit is. For example, I have 2 credit cards (only one of them has a balance, at a very low rate for the life of the balance, and the other card has a low limit [at my request] which can't get me in much trouble - £500 - and truly is just for emergencies, if I need to fly home for a funeral for example), I don't think of them as "credit cards" though, I think of them as expensive loans and since I changed my outlook on them I don't use them any more. I now understand how the application of repayments to low interest balances impacts the life of the debt, and also now am aware my minimum payment is actually LESS than my interest charge each month! SO read Martin's words whenever yo uget a spare moment. Get yourselves clued up on how these financial organisations really work and feel smug in the knowledge you know what they are up to.

Another piece of advice to anyone facing the same overhaul of their finances - you have to budget realistically. Despite paying £9k off in a year I still had a holiday last year. Albeit a cheap package holiday but without it I'd have had a breakdown which would have been counter productive in a major way.

I have become addicted to monitoring my finances and can be found boring my friends about it regularly. I check my internet banking balances daily, often 2 or 3 times, even if I know there isn't likely to have been any activity. It just helps make it a part of my life to know exactly where I am financially at any given time. I also track my money with a simple spreadsheet I wrote (and carry with me everywhere on a USB stick on my keyring!). Having the spreadsheet acts as concrete evidence of the debt going down, and this is very motivational in itself.

So I'm hoping to be completely debt free by Decemeber this year (optimistic, it may not be Dec but won't be many months after that, if any) and not a day goes by I don't think about what I could do with the money I'm paying off my debts instead (a red GTI VW Golf by the way, 2nd hand and I intend to by it with all my own money!!).

Thanks for reading and good luck to everyone else trying to get debt free! I wish you all the success I've had so far and more;):cool:

thevinternet

You, sir, are an inspiration.:T

Congratulations on all your success so far, and keep us posted.:beer:

HHH_2

well done you, I,m very impressed!

Damita

Yay congrats!

looktothefuture

Turbo, I know the feeling... I too came to the UK 6 years ago and up to that point was debt free! Within months I was offered an overdraft, car loan and a mortgage and I was earning a piddly £7.00/hr... just goes to show you hey? Now look at me ... ££££ in debt and struggling to survive...

You are an inspiration, keep going!

turbo.jet

Thanks for your encouraging words everyone! I'll keep you posted as to my progress.

Toni_Broke

Hii turbo.jet

Would just like to thank you for your wise words.

We too have done a realistic buget as i think that living on basic rations over a long period can be demoralising.

The fact that our buget is in place and we are paying well over the minmum servicing our debts is what keeps us motivated. It might take us that bit longer but we will get there.

Good luck with the home straight!

Toni xx

turbo.jet

I've just started using the forums again after a long absence and found this old thread I started nearly three years ago! I thought I'd post an update to bump the thread with the latest mini-SOA.

A lot has happened in my life since then. I continue to be completely aware of my financial situation at all times, but the massive debt reduction rate I achieved back then has slowed somewhat.

After a relationship break-up two and a half years ago I had to find a new place to live incurring all the costs that go along with that. Eventually I got back on track again after paying agency fees and getting everything I needed for my flat then my flatmate moved out. I couldn't face moving again so opted to stay and find a new flatmate. The real estate scumbags have outrageous fees for doing so, plus it involved me paying the rent on the entire flat for a period of time as I had someone say yes then pull out.

Basically, every so often something happens which make me dip into my debt. I am taking three steps forward and one back, which is better than none forward I guess.

To my credit, throughout the entire life of the debt, I have never missed or been late with a payment (except for one where Barclaycard conveniently-for-them didn't take a D/D a few years ago) and all my utility and other bills are always paid on time in full (I send the correct amount to a seperate account just for bills D/D's every payday then I don't ever spend the money).

I have been servicing my debt which has occasionally increased slightly due to events such as the above, but on the whole has still come down and I currently owe ~£7000 (see my signature for actuals).

I am in a phase now where I am taking action again. I have all my debt on one card at 0% for a very long time. I also have savings for the first time since I came to the UK nearly 10 years ago.

(I know the golden rule is don't save until you have paid off your debts, however I NEED to visit my friends and family in Australia and this is non-negotiable. I am still paying off £215 off my debt a month after saving £100 a month for Christmas and the plane tickets).

Any extra cash I get (usually from overtime, sometimes a bit of computer repair work on the side) goes straight off my debt.

It feels good to have all the debt in one place (well... it will be after November 21), and at 0% interest. Makes it easier to reduce my overall debt.

My interest free period runs out in January 2013. My plan is to find another 0% deal at that point to continue paying no interest. Or, ideally, maybe I will have it paid off by the time the 0% deal runs out if I can rack up enough overtime

Thanks for reading. Tolstoy eat your heart out

**edit** I have NO desire for a red VW Golf any more! Isn't it funny how things change?