Story of one man's LONG road to financial recovery

turbo.jet

I need help!

I know what I need to do. I know what my problem is. I read this site all the time now.[STRIKE] I just can't stop spending![/STRIKE] *edit* Yes I bl00dy can - I've proved it! Read on

I have made massive strides in reducing my overall debt and I'm very proud. The biggest dents, however, have been as a result of windfalls. I take 3 steps forward and one step back.

Once upon a time I managed to achieve a £9,000 reduction in my debt in about 10 months. Then I lost focus and momentum, plus had a relationship break-up which incurred a lot of costs, it then took another 3 years to reduce it by £4,000. I need help staying focused and I think by keeping this diary I can do that.

So here's my story. I'm 32 and originally from Australia. I arrived in the UK in February 2002 with about £5,000 to my name. This ran out some months later and the only work I could find was unstable temp work earning about £6 an hour. Despite this, these were the days were they were giving massive amounts of credit to pieces of string, bunny rabbits and lamp-posts... and me! I had a £15,000 line of credit from the good old bank within months, which I took full advantage of, knowing nothing then about how credit worked.

I amassed about £1,700 in unauthorised overdraft fees (have reclaimed £1650 successfully! ), repeatedly consolidated multiple credit cards into personal loans, then run up the original cards, flew home to visit my family a few times and basically lived beyond my means. At its worst, my debt reached just over £20,000 and I had no exit strategy.

I am now EXTREMELY knowledgeable about credit and play the system to my own benefit. My Experian credit score is 999 - in the 'excellent' category and I'm re-doubling my efforts now to kick over the last of my debt. The last of my debt is £6,900 as at today and its 0% until January 2013. I am making WELL over the minimum payments very month - throwing £215 at my debt each month. I also plan to throw any future overtime and windfalls at it too.

My biggest problem at the moment is how much I spend on food. I buy as I eat from Sainsbury's Locals and Tesco Expresses. I buy a hot meal from the office cafe most days, if not I'll get a meal from ASDA across the road from my office. I am about to address this.

It was payday yesterday, so I am going to do one BIG cheap shop and plan my meals for the week. I am lucky in that I'm a good cook so I shall be making a big cauldron of bolognaise and making into several different types of meals (lasagne, spaghetti, shepherd's pie, chilli etc). The annoying thing is that I have an underbench fridge with a tiny freezer compartment... but I'll manage.

I have also just invested £3 in a powerdown switch which will cut all the electricity to my stuff when I turn off the TV. I have a free energy monitor from my electricity company and all my light-bulbs are energy efficient - can't believe how much the old ones cost to run! I've just switched dual-fuel tarrifs to the cheapest one for my situation.

Every bill I have had increased in price in the last 3 months. The only one left is water. I'll actually be glad when that happens as then I know the increases will be done with for now, and I will know exactly what my monthly bills will be for the next while.

I am actually a VERY organised person by personality, so blinkers have not been the cause of my debt problems. I carry a spreadsheet around on a USB keyring which I update daily. It contains details of everything I spend and on what. It ensures I never go over my overdraft because I know the impact what I spend today will have on me at the end of the pay cycle. It is colour coded and has formulas which tell me how many days until payday and how much I have left to spend each day etc. Also, I have a separate current account for bills direct debits, so effectively I only have one bill payment to make each payday (to this other account) and I can then forget about the risk of defaulting.

I have an old laptop I'm going to rebuild and eBay, also need to visit the music magpie site soon. I will rummage around for anything else I can liquidate too. I want to bring my DFD forward as much as possible. I have just increased my repayments by £15 which has reduced it by 3 months - meaning, as it stands now, I should be debt free by my 35th birthday. That's if I don't fall off the wagon again, which I'm hoping you will all help me with.

By the way... every pair of socks I have taken off this week has had my toes poking through! Why has this all happened at once?! At least they were in the budget for this pay period

My long term goal after paying this off is to start saving for a house deposit. Its my dream to own a house and hopefully by the time I have a deposit the mortgage market will be in a better state for us borrowers. I'd also like to have my own car again. Nothing fancy, just something small and reliable. I will definitely be buying it with all my own money however, as the £2000 loan i got to get my last car was the real beginning of the end for me.

Anyway, I've rambled on enough for now. I hope this isn't too mammoth a read for you and I hope you can find the odd encouraging word for me when I need it. I promise I will be a VERY regular visitor on this site from now on.

Thanks for reading

Aiming_High

Congratulations on your diary. It's good to ramble in a place you can call your own - I do it often. :rotfl:

mary81

Hi! found your diary and have subcribed to it. You have done so well so far! I'm liking doing the diary thing, like you say friends get bored of listening, but no proper MSE'rs!!:j

debtfreewannabe321

hi turbo jet, good luck with paying the rest of the debt off, you've done fantastically well to have paid off that much in such a short space of time

I'm also with you on the whole out look of credit. I used to have 6 cards at one point, a loan that i topped up if i needed something (you know, something really important like a new pair shoes, handbag or holiday...) and an overdraft of £5k at one point. I now have nothing, mostly because i'm on a dmp so to have credit would break my agreement with the cccs but i honestly can say i've never felt better! An emergency fund is the way forward and i will be teaching my son this too!!! (and the other two when they are older )

dfw x

turbo.jet

Thanks guys.

debtfreewannabe321

have re-read!

Have you thought about getting another freezer so you can batch cook, you may be able to get one from ebay or freecycle cheaply and that would help to keep food costs down?

Also do you have an ald* or l*dls near you they are nice and cheap and pretty much the same quality as tesc* i think?!

Well done for addressing it all and having a plan though, look forward to reading

Aiming_High

re-read. I have family in Australia so can sympathise with the flight costs.

turbo.jet

Am I not supposed to say company names? Ok lesson learned! Actually, there is one of those 4 letter named stores very near, next door to the an ASD* which is great - both very cheap.

Absolutely no room in my tiny flat for a freezer I'm afraid, but that's ok. I can stick it in the freezer at work if need be - that's where I'll be eating the meals after all. I'm trying not to eat big meals in the evenings (my other goal is a bit of weight loss)

turbo.jet

I've just increased my monthly debt repayment standing order by another £35, making the total increase since I really knuckled down last week to £50, on top of the £200 I was already repaying. This has brought my anticipated debt-free date forward 6 months to March 2014.

My current goals -

1) Get a 2nd job behind a bar a few nights a week in my area. Of the money that I make doing this:
- A third will go off my debt (on top of my existing £250 p/month repayment) bringing my DFD forward;
- A third of the money will go towards my 'holidays & christmas' fund (in an ISA at 3%, current balance £600 - on top of my existing £100 p/month payment);
- A third will go toward groceries/entertainment to reduce the pressure.
2) Liquidate anything I can through eBay
3) Lose a bit of weight
4) Stop smoking
5) Start batch cooking and take lunches into work.

I had a result on the weekend, winning £10 on the lottery, however I suffered a disastrous set-back when I lost a set of keys for an apartment I was staying in, and am facing a 300 Euro bill to replace the locks!!! I could have cried. I spent all day yesterday miserable when I found out

I've been asked to travel up to our other office in October for a few days, which will likely result in some overtime £££'s for me, and definitely result in 45p a mile expense claim.

Completed LOADS of surveys today too. Hopefully I can get some vouchers in time for Christmas to ease that burden a bit. Only signed up last week to all the sites and have already earned quite a lot of points.

LondonGirl252

Hi again!

I found your diary and subscribed, well done on doing so well already, I hope my story follows the same route as yours our DFD's are within a month of each other so fingers crossed! It won't be easy but it will be worth it!!!

Good luck!

mary81

Hi, sounds like your doing well apart from the keys, nightmare. Think i mgiht have to do some of these surveys, i'll have the find them first though lol. Thats great to be bringing your DFD forward by 6months!!
well done on the second bar job front, but make sure you find time to look after yourself too, after all, you need some time to do your cooking:D