What advice would you give to someone not in debt

nuno

and obviously not wanting to go into it. ever.

I've just finished uni, so I do have a student loan hanging over me (~£10,000; i'll just chip away at it slowly I guess) but i've got a good job (not earning loads but I know i'm quite lucky - £21,000)

I'd be interested in some tips, hints and wisdom from those who are in debt and obviously wished they never went into it. What few things would you have changed when you were in your early 20s so that you avoided some of the horror stories i've read here in the last couple of days?

I'm going to try and save 15% of my salary every month to put towards house deposit etc...one day

any good tips appreciated!! Sorry if this is the wrong forum to post this in.

WRINKLES

dONT GET A CREDIT CARD, Pay for everyday spends with cash, Understand the difference between what you want and what you need. KEEP SAVING Good Luck

BigCraigJohn

As above.
Credit cards are evil.
Loans have a place but not for cars or holidays.

angelicmary85

Hi Nuno,

Welcome ot the boards!

I'm early 20's but don't have very much debt, I'm here for ongoing ideas, hints and tips at how to manage my low income and keep a roof over my kids' head!

The one really good piece of advice I can offer you is to meal plan then buy all (or most of if you can't freeze everything) of your grocery shopping online.

This saves you from nipping to the shop for an ingredient that you forgot and spending £15 on rubbish! :cool:

Doomcow

aye, 21k and only 20 is great going - keep in mind its all relevant to where you are. 21k might be rubbish in london but here in the styx its nice wages. if you are still staying with parents you could probably save about 84% and live comfortably.

i only have the 1 credit card which i used for holiday spending and im "stoozing" the £500 i spent on it, but seriously, its hanging over me and im gettin twitchy about it - got till feb / mar for 0% deal to be out too!

justjohn

my advice is save as much as you can as fast as you can , but thats just me.

life is for living it is NOT for working and paying bills. Sooner you save and have everything you want , then sooner you can start living.

i started late and only now at 40 have the things i want. So now the living begins.

Debts and credit are good ONLY IF WELL MANAGED, but things happen.

Annisele

As a contrary view...I don't think that credit cards are evil. Section 75 can be an extremely useful way to get your money back if, for example, a seller goes bust before it delivers an expensive item to you.

Rather than "credit cards are evil", I run with "have only one credit card, not issued by my debit card provider, and pay it off in full at the end of each and every month". (There's nothing wrong with the bank I hold my current account with, it's just that when that bank decides to freeze my debit card because it thinks its found fraud, it's good to have another method of getting money - and vice versa when my credit card company gets suspicious).

Different people manage their money in different ways. I don't use cash for very much; I find it easier to budget if I use my debit card for nearly everything because then I can see what I've bought without the effort of keeping a spending diary (I'm lazy). Looks like Wrinkles would disagree with me - (s)he wouldn't be the only one - but my method works for me.

As you've suggested, I think the best way to avoid debt is to build up savings *before* you need the money. You never know when your car is going to need £300 of work doing to it, or you get a great opportunity to attend an interview on the other side of the country and you need a suit and a train fare, or you need to pay a locksmith right now...you get the idea!

If you save beforehand, then interest works in your favour and you get back more than you saved. If you pay back money afterwards, you're the one paying the interest - and you can see from some of the posts on this forum that things like payday loans charge eye-watering interest rates.

angelicmary85

I went away and had a little think and I've popped back with another couple of ideas...

If you ever think your money is slipping through your fingers, keep a spending diary for a few weeks to see where it's going and then cut back.

I know the general concensis is to use cash to pay for things but I find if I use my debit card then I don't end up taking £10 out of the bank to pay for something at £3 only to find that the rest of it 'went missing' on 'stuff I didn't buy'

I do think credit cards have a place in my purse. I like the security of knowing I have back-up IF I need it, not if I WANT it (Apparently the best place for them is in a tub full of water placed in the freezer :rotfl:)

One huge tip would be to never lend money to friends or family. Although they may normally be trustworthy, good, honest people - as soon as a few quid is involved they can change in an instant. I've read alot of stories around these boards to never do it!

BigCraigJohn

I'll give you that on the protection. However we all know that you need to be very good to have a card and keep it purely for specific things then pay it straight back.
Personally speaking I find it easier not to bother, temptation is lethal(sorry my word of the day).
Not to mention the 5 i'm fighting at the moment.

Annisele wrote: »

As a contrary view...I don't think that credit cards are evil. Section 75 can be an extremely useful way to get your money back if, for example, a seller goes bust before it delivers an expensive item to you.

Rather than "credit cards are evil", I run with "have only one credit card, not issued by my debit card provider, and pay it off in full at the end of each and every month". (There's nothing wrong with the bank I hold my current account with, it's just that when that bank decides to freeze my debit card because it thinks its found fraud, it's good to have another method of getting money - and vice versa when my credit card company gets suspicious).

Different people manage their money in different ways. I don't use cash for very much; I find it easier to budget if I use my debit card for nearly everything because then I can see what I've bought without the effort of keeping a spending diary (I'm lazy). Looks like Wrinkles would disagree with me - (s)he wouldn't be the only one - but my method works for me.

As you've suggested, I think the best way to avoid debt is to build up savings *before* you need the money. You never know when your car is going to need £300 of work doing to it, or you get a great opportunity to attend an interview on the other side of the country and you need a suit and a train fare, or you need to pay a locksmith right now...you get the idea!

If you save beforehand, then interest works in your favour and you get back more than you saved. If you pay back money afterwards, you're the one paying the interest - and you can see from some of the posts on this forum that things like payday loans charge eye-watering interest rates.

angelicmary85

BigCraigJohn wrote: »

I'll give you that on the protection. However we all know that you need to be very good to have a card and keep it purely for specific things then pay it straight back.
Personally speaking I find it easier not to bother, temptation is lethal(sorry my word of the day).

I think you make a valid point but I have 3 cards.

I keep one as an emergency which only has an £1850 limit.

The second is a premier card wih noting on it but I keep it as I have a really good credit rating but now I earn alot less than I used to so will probably struggle to gt a card based o my income.

The 3rd one is like my baby. I don't know why I'm attached to it. I can't get rid if it no matter how hard I try, I use this card if I ever need to use one.

I do agree with you that tempation is lethal! I never use my credit card for petrol, food or things I want. This is because those things would be gone before the debt is!

Annisele

angelicmary85 wrote: »

I know the general concensis is to use cash to pay for things but I find if I use my debit card then I don't end up taking £10 out of the bank to pay for something at £3 only to find that the rest of it 'went missing' on 'stuff I didn't buy'

I've had so much money 'go missing' that way!

I now have a jar on a table at home, and if I do end up with change it's likely to go from my purse to the jar within 24 hours or so. When the jar is full, I take it to my bank and chuck it into the coin counting machines (NOT the ones in Asda that charge silly% of your money, the bank ones that do it for free). The jar means that I don't usually have small change with me, so it's harder for it to disappear on chocolate bars or things that I wouldn't bother using a debit card for.

(If you do do that, make sure you take your money to the bank on a regular basis. When I started doing it I just filled up jam jars with coins - by the time I got round to taking them to the bank, the coins alone weighed two stone!)