A Word of Encouragement

Nearlythere_2

Afternoon all, been reading here for ages and thought id drop by to give 'debt free wannabees' a bit of encouragement.

3 years ago, i was earning 11k a year and I was clearing £800 ish a month. Living alone meant my rent was 375, council tax 60, elec 30, plus all of the 'essentials' that you need in your 1st flat, ntl cable, internet, home phone line etc etc! Add on 40 for transport to work, food and all the rest meant that my outgoing were very close to my income.

So, once i got given a credit card life became a bit easier! always a bit of spare cash! then came a few more credit cards, loans, overdrafts etc. Did a great job at juggling them for a while, but once they were all maxed i was in severe trouble. with literally a few pounds spare after my monthly costs I was left with numerous debts, many over their limits and recieving obsene charges and no money to pay towards them, or to even treat myself to an ice cream.

All in all my debts amounted to £23k. After paying rent and regular monthly bills i was left with approx £30 per month to start to pay this off. Baliffs started knocking too.

The penny dropped!

So, i left my flat, moved in to a cheaper 2 bed with a close friend. My rent went from being 375 plus council tax, plus elec, plus water etc, to me and my flatmate both paying 280. This included rent, council tax, elec, water, and left about 40 in a seperate account just sitting there so that if the fridge blew up we had a contingency. If by december we hadnt had to use it we'd get a couple of hundred quid each to help with the financially draining chrismas.

I now pay £15 broadband, and my flatmate pays £11 per month for the line rental. We only use the line for 0800 numbers and to recieve incoming calls. Basically its fairly well split (considering he uses the net once a week tops and i live on it). I have a skype account to talk to some friends in canada for free.

I cancelled my mobile contract and went on pay as you go. Easy mobile offer 5p texts to any network, and once i got my girlfriend signed up we can text for 1p to each other and chat for 3p per minute.

Gave up smoking! (god help the people who knew me that week). It CAN be done. Its easy, ive done it hundreds of times (he he). With that ammo i started walking to work (bar a downpour) and feel so much more healthy.

I contacted the CAB and worked out my finances and started to pay the debts off once my outgoings had come down. I found that all of the companies froze the interest on my accounts, or closed them with no further charges which was a huge help. Within 1 day i went from having credit cards, overdrafts, loans to having a basic cash card and loads of closed accounts awaiting payment but no accruing any more charges or interest.

Since then im earning more, altho still not a fortune but im in a job with great prospects so that will improve with time, but over the last 3/4 years ive got my debt down from £23,000 to £4800.

I even got my visa debit card back (that took a while). So much more convinient to shop with and can do online purchases. Gradually my banks trust in my improved and i have a £450 overdraft. I dont use a penny of it EVER but thats not the point. The point is that being in debt doesnt mean you will never get credit again, work on clearing it and in time you may be granted that mortgage so you can buy your own home. I have a credit card with a £400 limit which i use to pay a few household bills. It gets cleared in full every month and i use it purely to help repair my credit rating and doesnt cost me a penny in interest.

The only debt remaining is one last loan, which i hope to have cleared within a year. £4800 and counting (was originally 14k). I now clear enough money to pay all my bills, and a fairly significant sum towards my loan and have £100 per week disposable income. Does not sound like a lot but is a huge step up from £30 a month.

Basically my point is dont give up. Ive gone from 23k in debt whilst earning 800 per month and having £30 disposable income per month to having £4800 of debt and £400 disposable income (theres usually 150-200 left which goes straight into the loan)

IT CAN BE DONE! Good luck everyone :j

In_Search_Of_Me

Just wanted to say a big thank you for sharing & to say WELL DONE!!! Its SUCH an encouragement t know that it is possible...especially for the numerous people who feel that they are getting nowhere (2 steps forward 3 back) at the moment! Keep us updated & we'll all have a big DFW style party when you pay off the last bit!!

Nearlythere_2

one thing that was a huge help for me was a nifty spreadsheet i made. You put in your income, outgoings etc, shows it all as a pie chart so you can see what your spending the most on etc. Most importantly it works out your weekly disposable income and allows you to keep track daily of what your spending - makes it much easier to keep track of where you are. Also shows charts of your debts and where you are - very reassuring when you tell it youve paid some payments and you see the difference it makes. If anyone would like a copy let me know and ill send it.

MinnieSpender

What an inspiring story! You've made me want to push ahead and get mine cleared. I wonder if I can do it in a year?

LittleL_4

Yes, thanks for sharing that with us, it's exactly where I am just now and you've made me feel better :T :T :T

At the end of the day we're all so alike aren't we....

Bet you've learned the money lesson now. Are you very young? Coz I feel at 36 I should know better

Little L
x

newleaf

Thanks for posting. A success story like yours is really motivating. :T

corrig24

Thanks for sharing it good to know that it can be done, I'm hoping to be DF by Feb 07, like you I lost control when I got my first credit card (Its a love/hate thing)...

LittleL, I'm 29 and I wish I had learnt it sooner too, we have to be positive and say that at least we have learnt (even if it was the hard way), we wont forget it in a hurry. So I think well done it in order!!!!!

LookingAhead

Thanks for your story and really really well done on a stirling effort & congrats on quitting the smoking, surely one of the most important things anyone can do.

:T