the maccas Debt Free Diary - 20K to pay in 18 months

medman

Hi again,

I don't want to hijack your thread with my own story but I'll try and summarise. We were in Northern Ireland on just my wages and we were about £20K in debt with two very young kids. This was in about 1993, cost of living in NI was very high and we were sliding each month. We'd done the usual cycle of CC, max out, consolidate etc. Until nobody would lend us any money!! I then had light bulb moment, swallowed my pride and borrowed the money off my brother, cleared everything and paid him off over the next three years.

Moving to Germany was what made it possible, we earned more and everything cost less: duty free motoring, duty free everything. Plus all the shopping temptations that would get OH spending weren't there (M&S, NEXT etc). Choice in the NAAFi was limited and the range in the German shops was unfamiliar.

Getting from -£20k to 0 took ages getting from 0 to +£20K is much quicker. We're now well out of the woods and the effect on our relationship has been entirely positive the whole household is happier.

The effort we used to put into spending now goes into saving. My eldest is at University and it cost a bomb! I Commissioned ten years ago so now I earn a pretty good salary. Lessons learned the hard way won't be repeated.

I think that'll do about me. It sounds like you guys are on the right road. The milestones along the way seem distant but it gets faster. Keeping your gratuity for yourselves is a really good incentive. I wish you all the luck in the world.

best wishes

themaccas

Please don't worry about hijacking the thread, I love to hear other people's stories. Wow, well done. We were in NI 1999-93 and loved it, during this time we managed to pay off our debts we had had since '87 and we left NI with a house deposit and savings. Unfortunatly when we got our first home we/I wanted everything in it and our debts started to mount again, very slowly at first. 11 months ago we had reached 'crisis' point and hence the mission to pay it off.

I have found my aspiriations have changed since we started this journey, quality of life is far more important than material posessions. I would rather have 1 lovely family holiday a year than a big house with a suffocating mortgage. You are right about the milestones we celebrate each one! This time next year our debt will be in 4 figures and we'll be counting down the weeks hopefully!

Thanks a lot for writing!

taxi73

Hi the maccas ...nice to see you're still on track giving us all motivation...and what a proud moment it will be when you come in under 4 figures...funny thing you say about the size of house ...on the money we were bringing in we could've had a larger lovely house..and larger bills but decided to get a smaller house so that we could have nice holidays..quality of life is definitely more important than possesions

do_it_today!

Hey the Maccas you are doing a great job :T gosh if you do manage to find your £2500 for holiday spend that will be almost $5000 spending dosh :T :T brilliant! no plastic hangover after the hols eh :T
its true about the whole house thing... six months ago I felt tying myself to a top of our budget mortgage was my absolute priority but now staying in our modest smaller house with a more managable mortgage is more attractive for now - pay those debts sooner - build savings faster and live a little as opposed to living on a tightrope lifestyle just to be in a "I've made it house" that could be whipped away.
I still want the house but I want a more solid financial foundation first and that means being in control of our expenses and zapping those debts first :T It might take a bit longer but we'll get there... The Maccas and op's here really do help me and other readers on here move towards our goals :T its good :T
good luck with your spending money fund :T

themaccas

It's xmas eve and I have just told OH that we have paid over £20k off our debts this year and he is still recovering from the shock! We are really pleased but we know how easy it will be to slip up again when the dreaded s-a-l-e-s start. We have decided not to go into town this year because I KNOW we will be tempted to spend lots of money....... I have sone some ordering off the NEXT sales site and found it all far too easy and before I knew it I had spent £250:eek: I have bought 2 suits for OH, 3 shirts, ties, new coat for DD, 3 jumpers for DS1, jeans for me, jumper for my brother and 2 tops for me. It is quite a lot of things and I will be able to pay it all off straight away as we have a new fangled thing called savings!! It's just that it was all too easy.........

I really need a new coat and was going to wait until NY but the weather is freezing at the moment and the walk from the carpark to work (15 mins) is bone chilling and I am weakening...... The one I want costs £100 and I am desperately trying to justify the expense, the true answer will be whether I can afford it with my debit card, if not then the answer will be a simple no and I'll wait til NY as I'm just too fussy:rolleyes:

OH and I have decided that come May 2007 we are going to really try and see if we can blitz the debt and pay it all off by next xmas, I'm not sure whether it will be possible but we'll give it a good ol try:D

In the end this xmas has bee quite a cheap one, all the money has gone on the 3 kids and OH and I are not having pressies this year:o Never mind, we hope to have many more debt free ones over the years:T

Happy Xmas, I am sure I'll log on tomorrow and see some of you here to share a mince pie:rotfl:

slowlyfading

Hope you have a great christmas, and you've done amazing this year!

taxi73

Wow well done £20,000 ....that's amazing!!!!...you must be so proud:p and I'm positive you'll make a big dent into the rest next year too...you are such an inspiration to the rest of us:D
Have a merry christmas and happy new year

themaccas

Hi taxi, slowly fading, doittoday and everyone else I am pleased with how much we have paid off it's just that we still have a large amount still to go and I'm feeling really naffed off with the debt right now.

We will start Jan 06 with a joint income this month of nearly £5200 which seems alot but it needs to go a long way. We have a £587 bill to pay for one of OH's courses he is doing (was originally going to be £4800 so shouldn't really complain), We need to pay £1350 for our 10% contribution to DS1 and DD's school fees. I need to pay £100 in order to APEL 2 modules I took at a different university towards my current degree course. I need to settle a £45 bill for school shoes, and I need to pay the final installment of our holiday accomodation - £550 and pay my car insurance - £330. All that comes to £2962, our debt repayments (including overpayments) are £1377 and all our bills for everything else come to £1535 not including petrol and food which will be another £500.

So that leaves us £1174 ish short for the month. We have £2800 on our savings account so I guess we will have to use some of this. Thank goodness we do have this, I am really upset we have got into such a bad state this month, I had an arguement with OH just now after he came home from Tesco with 4 Superman yoghurt drinks that cost £1.98. I mean how petty am I getting?!

themaccas

I've been really struggling the past 2 days, having paid off so much debt has turned out to be a double edged sword. Yesterday, OH wanted to stop at a garage to have a look at on overpriced, over indulgent car and promptly fell headover heels in love with it. We should never have stopped at the garage, or looked at the car, or gone for a test drive or asked about part exchange value:o . We did not buy it, and walked away. Thought about it overnight and the feelings to go and buy it are all too present, we went out do the weekly shop today and decided to look at it once more:o again we walked away..... OH has had to go back into town this afternoon and I know he'll go and look at it again.... it is torture for him and I know he's going to weaken and probably buy it.:mad:
Just not sure what to do, I regret agreeing to go and see it. We can't afford it and it will put us right back, but half of me wouldn't really mind:mad: I mean I just can't figure myself out I wish I had not paid off so much debt now as I am starting to forget how difficult the last year has actually been, I hope for him to come back and say he didn't get it but who knows...... I'll find out soon enough:eek:

medman

Hey The Maccas,

Happy New year and I hope Christmas was good to you.

I've been keeping an eye open for your thread, and you've achieved so much so quickly. I do understand the feelings your getting, the temptation to return to the old ways once some debt has been cleared is nearly overwhelming. But you really need to resist. This is why I went through the experience twice. Once I cleared debts I thought "that's it, I can stop being carful now". We ended up back where we had been but twice as bad.

The route of all our debts without a doubt was cars. They are so expensive to buy and when it comes time to sell it, they tell you "nobody wants them now" and give you a pittance. We once bought a new car because we didn't have enough money to repair the one we had, which was only three years old. But getting a new loan was easy!! Madness!!. Since we cleared our debts and started saving we don't use loans at all we bought the last car cash. You want to see the forecourt price fall when you pay cash!!

It's also very easy to fall out while you're in debt, you really have to keep in mind why it is you're falling out. A new car now would in my opinion be a big mistake, but perhaps you could use as an incentive: Once the debt is cleared we'll buy the new car.

Even though we cleared our debts and have accumulated a nice little nest egg we still budget very tightly and get rid of any unessary expenditure. It's rather like being an alcoholic or a reformed smoker. "One little loan wouldn't hurt me" but we know where it leads.

Sorry for being so long winded but this is a risky time and if you can get through this you can buy the car next year on your terms, try and be patient.

All the very Best

MM