Clear my debts in 12 weeks!

nopot2pin

MoneyWaster2007 wrote: »

Been into the bank and overpaid again this afternoon and when my monthly repayment comes out on Wednesday, my balance will be......£959.58!!! and inside that final thousand!! Woooooo. Also, my Xbox 360 has sold on eBay, generating an extra £107.55 to throw into the loan next Friday!!! Wooweeewooowaaa!!!:D Plus whatever I manage to save from this weeks wage, which should be about £80.


nopot2pin - Ive tried the stopping smoking thing countless times, and each time I failed, so I now smoke tobacco which I get on the cheap from my dodgy friends:oso I still save on that. I cant wait to be debt free! Id love to be able to go on a far flung holiday as you described and maybe that will be a possibility in the not so distant future

:T:T:T:T

That is brilliant, that you have managed to get your debt under £1000.
Truely brilliant

The smoking thing will happen or not happen if its meant to.

Catzpaws

I wish my debt was under £1000. I was ecstatic when I got mine below £22k - ha! Anyway, well done!

Have you tried nicotine patches? I used these and the Allen Carr books together and that helped me kick my habit.

Happytogetdebtfree

well he gets paid more than me, so when he does jobs with his own business he generates some good cash so it does help definatley x

MoneyWaster2007

As my debt free day looms ever closer, my thoughts are turning towards what to do next. Ideally, I would like to save something from my wage every week and make sure that my savings keep growing and never touch them. However, there are bound to be things that I would like to buy aswell. So the way I see it is I have 2 options; option A: have 2 seperate savings accounts - 1 of which I never touch and keeps growing, and the other account I would use to buy 'small' things for myself, such as clothes etc.
Option B would be to have 1 savings account and save up for something, spend the lot, then start again. As I am new to this, I was hoping someone could offer me some advice on this? Thanks in advance, Money.

mandragora_2

MoneyWaster2007 wrote: »

2 options; option A: have 2 seperate savings accounts - 1 of which I never touch and keeps growing, and the other account I would use to buy 'small' things for myself, such as clothes etc.
Option B would be to have 1 savings account and save up for something, spend the lot, then start again. As I am new to this, I was hoping someone could offer me some advice on this? Thanks in advance, Money.

I'd go for Option A, because over time, you'll be amazed how that can grow - and, when you need it, or there's a great deal you want to take advantage of, it's there - but best not to look at it, or think about it too often - for example, when our kids were small, though we never got into debt, we almost clear ran out of money more than once, and lived 'old style' long before these boards. When we could, we saved - if there was something we needed, and we had the money there, but there was also an interest free deal attached to it, we always took it up, knowing the money was there to pay for it, and, whenever possible, trying to pay off each month as the bill came in - that meant, some two years later, we'd have the thing we'd been buying (car/furniture, whatever) and the money still in the savings account. It stopped us from spending what we didn't have. Somehow, over time, that tiny snowball has grown enough that when my car 'died' last week and wasn't worth repairing, we were able to take advantage of some of the great deals around on scrappage at the moment, and got a brand new vehicle for under £6k - and knowing that we have plenty in the savings accounts to pay for it. Given that we paid £1k for the old car in the first place, and ran it for 5 years with barely a bill to pay on it, it's given us a pretty good return, what with the £2k & of funding it released for us! If you look at it in the long term, if you can save say £2,000 a year, in twenty years that will be £40k. That's quite a sum, isn't it - I'd rather be in savings to that tune than debt to the same amount.

MoneyWaster2007

Thanks mandragora thats really helpful! I just have a couple of questions about your method (correct me if Im wrong). The first is, to be able to take out finance on anything and qualify for the shiny 0% APR that they are offering, you must have a flawless credit record, am I right? Mine has a default on I think, but I will check this as the first thing I do when I get debt free. I think the default is only a small amount under £100 from a phone bill which I didnt pay about 4 years ago....do they automatically remove this after 6 years? Sure I heard this somewhere...and also, how long is it after I have tweaked my credit files until my credit score is 'repaired'?

The other question is, you say that you always take advantage of great deals on things which offer a 0% APR, even though you could easily buy the item outright, but would rather keep the cash in savings and pay for the item monthly. I can definitely see the logic in this, but my problem is that this now means you are having to pay more out of your salary each month on the repayments, meaning less surplus income and things become a little tighter...

Happytogetdebtfree

Why don't you see a financial advisor? They can tell u about options for saving how's the loan payment

MoneyWaster2007

Hey, that might be a good idea thanks, the loan repayment is going good, still on track to hit my debt free date. On Friday I went into the bank and overpaid by £140, taking the outstanding balance down to £819.58!!! And this Friday coming, I will be able to overpay by £160, which will take it down to £659.58- happy days!!!

Had that bloody swine flu since wednesday, only just feeling a bit better now. It seems like everyone has it. Half the Blackburn football team were struck down by it over the weekend. Anyone else been unfortunate enough to have had it???

nopot2pin

If you save, with the same gusto that you are paying off your debt, you will have a good few grand in the bank by this time next year :T

Glad to hear you are feeling better.

mandragora_2

MoneyWaster2007 wrote: »

Thanks mandragora thats really helpful! I just have a couple of questions about your method (correct me if Im wrong). The first is, to be able to take out finance on anything and qualify for the shiny 0% APR that they are offering, you must have a flawless credit record, am I right? Mine has a default on I think, but I will check this as the first thing I do when I get debt free. I think the default is only a small amount under £100 from a phone bill which I didnt pay about 4 years ago....do they automatically remove this after 6 years? Sure I heard this somewhere...and also, how long is it after I have tweaked my credit files until my credit score is 'repaired'?

The other question is, you say that you always take advantage of great deals on things which offer a 0% APR, even though you could easily buy the item outright, but would rather keep the cash in savings and pay for the item monthly. I can definitely see the logic in this, but my problem is that this now means you are having to pay more out of your salary each month on the repayments, meaning less surplus income and things become a little tighter...

I can't answer your question about credit ratings, I'm afraid, but as to the logic of it, yes I'd definitely recommend it. It does keep you really focussed - and, ok, if for a while things are a bit tight, you'll always have the luxury of knowing that every month you pay off without needing to dip into your savings, then you've kept that 'cushion' there for yourself. It's a bit like the process that you're going through now, except at the end of it, you have the thing that you'd saved up for - the sofa or the hi-fi or even the car AND your nest egg too. If things do get a bit tough, and you want a bit of leeway, you can always do a couple of months where you pay half of the interest -free loan from income, and half from your savings. You need to be disciplined about it, but you've shown you can do that, just by what you're doing right now. It's a good way of making sure you don't buy what you can't afford, because you have to save up first, and, in the long run (and I'm talking ten or twenty years here) you really do roll up a nice little nest egg for yourself. Invest it wisely, and, as they say Bob's your Uncle, Fanny's your Aunt:T