Tips for staying debt-free

WRINKLES

Most people dont understand how to seperate what they need from what they want , learn how to do that and you are well on your way .

Devi

That is the key really isn't it - a slow and (financially) painful lesson I have learnt!

Marisco

Needs: Food/water, clothing, heat, light, shelter. Wants: everything else;)

husemin

...When I paid my argos store card off, I cancelled it, I've been in debt to that from the start for years. So now no more store card debt, my advice is, if you cant aford it, dont buy it.

H

Hannah_10

Before taking out a loan, work out what the total amount you will repay is and what percentage that is of the amount you originally wanted to borrow, because it's often surprisingly much. For a loan of £5,000, over 5 years, with 18% APR you'll have repayments of about £125 a month. Sounds Ok doesn't it... But by the time you've paid it back you'll have repayed £7500- what you borrowed plus half again! I find when I do the maths I often don't want the credit/loan after all.

MrC1977

Devi wrote: »

I update my "geek" spreadsheet daily - although i am sure yours is more sophisticated than mine!

whats a geek spreadsheet?

probably a silly question but i am looking for any tips to try and control my spending

Percy1983

Don't worry they aren't for geeks only.

Its down to you what you want out of a spreadsheet and how well you can work spreadsheets, if you don't have a spreadsheet program i would recommend openoffice as a very good free spreadsheet (and other office stuff) application.

As it is I use excel and can do a lot with it, I have a few pages on my sheet.

1, A spending diary, starts with payday and £100 (my allowed budget) and of course it reduces as I add things.

2, A budget which shows mine and my other halfs earnings, lists all 'essential' spending which works down to a total availto spend on debts.

3, The big one, starts by listing all debts with APRs credit limits and current balances. It then calulates how much interest the will all attract over the next 12 months.

Below this the is a scale labelled 1 to 12 months which compares the amount we can pay monthly to how much we would need monthly to pay the debts in 1 to 12 months (adding the relevant interest if debts went that far). As it compares totals against number of months left as you pass each marker that month turns green show one less month. Other things like APRs are on a scale of green to red (good to worse). and you can override APR's with promo rates.

As far as sheets go its quite an advanced one but I am an accountant by trade so it all makes sense, but I could make a template out of it or make more custom sheets for others if it helps.

Devi

My geek sheet is relatively simple - i list my monthly outgoings and subtract them from my income which tells me how much I have for "living"

I also have worksheets within this spreadsheet to keep a handle on the bigger things I am saving for broken down approximate costs as well as key financial goal reminders such as buying an annual travelcard before the end of this year which will save me £200, start a monthly savings plan in Jan 11 etc.

I know what you mean about loans - i once took out a loan for £12.5k and ended up paying nearly £19k back - a(nother) harsh financial lesson.

MrC1977

thenaks Devi & Percy

the spreadsheet idea looks good - are there any templates online? (I have ecxel so should be suitable)

i am new to all this as been burying head in sand for years. I am starting a DMP and now keep a spending diary. Scary what that has told me about myself so anything that helps me would be good as I am not a natural at living to a budget!

Percy1983

I think for you a simple 3 column sheet would be fine

A B C
(Date) (What For) (Cost)

Put a running total at the top of column (C1) "=sum(C3:C500)"

Next to it in Cell D1 the total budget and E1 us ("=D1-C1)

Simples