Millie's debt diary

mildredalien

I had a 'lightbulb moment' of sorts a while back and have been lurking/reading in MSE for probably about a year, but now is the right time for me to make a full and concerted effort to pay off all my debts. I have been in the fortunate position that my debts have always been 'manageable' and in the past few years I have avoided adding to my credit card debts at all. Unfortunately I have been quite nonchalant about paying off more than the minimum amount and I'm starting to get peeved about the amount of interest I am/have been paying!

For a little 'backstory' as it were, my debts accumulated from about the age of 20/21 through living beyond my means as a poor student and then poorly paid worker and paying for my dosser ex-boyfriend when he only worked part time and then was unemployed for over a year. This included taking a loan out for him to help him clear his own debts. Sigh. Oh hindsight you are a wonderful thing. At the end I was building up credit card debt purely to get through each month, but have since had a couple of useful pay rises and a few months of living with my parents after the inevitable breakup, which helped me get a handle on things.

Anyway I've decided that rather than carrying my debts on for another 6 or 7 years while I slowly pay them off and spend frivolously, I'm going to make an effort to throw every spare penny at them and pay them off as quickly as (reasonably) possible. I'm going to try to balance having somewhat of a life with paying as much as possible in as short a time as possible. I thought having a diary might help me to stay focused and accountable, and there's always good advice and support on these forums!

I would apologise for the rambling but it probably won't stop any time soon! :laugh: I'll get together my SOA and debt details shortly so I can log my starting point and aims...

Skintfoodie

Welcome to diaries Millie, looking forward to reading more!

mildredalien

Thanks skintfoodie!

My general plan is to put all of the non-usual expenses into a separate bank account (I have two linked accounts which are easy to transfer to and from) e.g. money for car stuff, haircuts, clothes, presents, emergencies on a monthly basis. According to the numbers I have worked out above, this should mean I am putting £110 a month into the separate bank account, to be withdrawn/transferred whenever an expense is needed.

£200 for groceries is probably too much, but I'm a bit crap at food shopping. It's an area I'll try and keep my eye on over the next few weeks/months.

The Snowball calculator has me paying off my debts in 13 months using the information in my SOA, which isn't too shabby. I hope I can pay it off earlier - I could be in line for a promotion early next year which would certainly help! If not I'm hoping I can tweak my expenses to free up as much cash as possible and pay anything extra onto my 'snowball' debt at the end of each month. As my overdraft is the last of the debts to be paid off in the plan, I'll take it right down to £1000 every month and pay off the higher interest debts with it.

mildredalien

Bah I spent ages trying to fiddle round with the snowball calculator results to get them to post in a readable way but no joy! The main gist is that I'll put all my extra money (should be about £160 a month) into Barclaycard 1 at the end of each month. By the time that is paid off, my dad's loan and Barclaycard 2 will be all paid as well. I'll then move onto the Tesco credit card, and finally the overdraft (the loan will be done somewhere in between these two). In theory I could be all done in 12 months!! I really hope I can stay motivated to do this, especially with Christmas coming up!

mildredalien

My commitment to try and spend less has been given a boost by the fact that I managed to lock my pin number so can't use my debit card til they send me a new one :wall: :laugh: In my defence I've been away for over a month and haven't used it in that time!!

On the downside there's a bunch of stuff that I need money for that I hadn't really accounted for in my budget - already! There's two people in work leaving who have 'contribution envelopes', plus the associated leaving do's... I'd guess that's £5 each to contribute to their presents, and lord knows how much for the do. I know at least one of them will involve a meal. Gonna have to suck it up really, these next couple of months leading up to Christmas are bound to be expensive... hopefully I can keep my beady eyes on my finances and not let it get out of control!

Today I spent £3.20 on lunch from Boots - not really back into the swing of getting meals ready before work, am barely back into the swing of work!

Skintfoodie

Hi Millie

Can you take your chequebook to the bank and do a cheque to CASH and they'll give you the cash out of your account? Or they might just let you make a withdrawal if you explain your situation, not sure if they cheque thing is out of date now!

Hope you get sorted with lunches, I'm terrible once I get out of the routine I find it hard to get back into one with making them! x

beanielou

Cant agree with you about saving £100 a month while you are paying debts with an APR of 20 odd %.
At the end of the day of course it is up to you.

mildredalien

beanielou wrote: »

Cant agree with you about saving £100 a month while you are paying debts with an APR of 20 odd %.
At the end of the day of course it is up to you.

Yeah it's not quite the done thing is it?? I know it's not the best way to pay off my debts and in fact, I could pay them off months quicker if I wasn't saving this money.... but for me, my debts are beatable as is in around a year. That's ok for me - I can see the light at the end of the tunnel! And I can do it without completely cutting myself off from everything I look forward to/enjoy.

Skintfoodie - HSBC are blimming awful, they have NO counters in the bank, it's all automated machines now! I went in to ask if they could change my pin number and/or get me some cash out with ID, basically I was told to go and use the telephone banking to sort it out myself and I'd have to wait for my new pin to come through post. Given that I'd never used telephone banking before and hadn't set it up, I just stared blankly at the woman til she did it for me :rotfl: Plus I don't think I've used my chequebook for 10 years, I've no idea if I still have one!!

I'm tempted to change banks....

mildredalien

Spent more today than I probably should have on food.... £3.80 on food for lunch although this will last for 2-3 days. then spent just under £10 on dinner for me and the OH, although this included an impulse wine buy! I spotted a bottle of new zealand sauvignon blanc that I had out there on holiday and loved, for only(!) a fiver. I'm going to blame the holiday blues for that one. Haven't even opened it yet!

Really going to have to get better at food shopping! My budget as worked out in this diary starts from 1st November, so I have about 2 weeks to buck up my ideas....

mildredalien

So today was a bit of an overspend...by about £120!! An unexpected one though, I had to book a last minute training event for work, fortunately I can claim it back. Makes me think how often it would be that even at this point in the month I wouldn't even HAVE £120 in my bank account even if I know I'd get it back in a few days!

I've been trying to tot up all of the events, spends and occasions between now and Xmas that I need to plan for:
- workmates leaving do (food and drinks - ~£30)
- 3 birthdays (budgeting £20-£30 each)
- wedding this Saturday (£30 petrol, £20 drinks)
- trip to Edinburgh to celebrate the big 3-0 (eek!) (have £300 in savings for this, will probably require substantially less....)
- friends coming to visit for a weekend (dunno how much extra this will cost, I'd imagine around £50)
- Xmas presents (total of £140 budgeted)

That's an extra £340 over 3 months on 'non essentials' - although I guess the 'emergency' and 'presents' funds would go towards this somewhat. Am wondering whether I need to budget for these types of things, or whether I should just tighten the belt more and spend less - or just not go to some things. I'm really glad I have extra money this month which should cover all of the expenses before Xmas, but if I hadn't, I would have really struggled. What happens next year when friends want to visit or someone has a leaving do? Not sure how I'll manage to say 'sorry you aren't in my budget'....

mildredalien

Today's spends:

£20 petrol
£2 lunch
£3 for book club buffet contribution

Put a claim in for the £120 back from yesterday and £65 petrol expenses so hopefully that will come through soon. Still no new pin from HSBC! :mad: Not sure how long they expect me to have no access to my current account for... fortunately I can transfer money from that account into my savings account and take it out with my cash card. Maybe it's a good thing that it takes effort to get money!!

A friend bought a car yesterday on a whim - it feels so alien to me to just be able to go and make such a big purchase! It would take me months to save up for a new car, or I'd have to loan money from my parents as I doubt I'd get a bank loan or a decent finance rate... Oh to be in her position with no debt and a good credit rating!!