Budget in place...what now?

vintagegirl

:rotfl::rotfl:I know what i should be doing, just want someone to kick my butt into gear.
I have some debts the same as everyone else here, as listed on a previous threads, and i have set up, in my eyes, a brilliant and doable budget but im now obsessed with saving every penny when i know I should bite the bullet and just pay it off the debts.

I want to have 1000 in savings and then pay it all off, which i know is a stupid idea and beyond all reason, but im so chuffed at having this budget in place, that i don't want to throw ever penny at my debts, even though i know i need to. I have no idea what im looking for here really :rotfl:

miketaff1408

I think you already know what everyone is going to say, don't you!

You already know that you should be paying off the debts rather than saving. The only time you would be need to be doing it your way was if you were earning more interest on the savings than the interest that would be accruing on the debt. Which is unlikely to be the case unless they are all 0% debts.

Think of the satisfaction you would gain at seeing those debts chipped away slowly. Once you get that buzz of seeing them come down, I guarantee that you will end up paying even £3 or £5 off the debts!

Well done for setting an achieveable budget and taking control of your finances.

cantbelieveiamhere

I too have just faced up to my debts and for the past few days have been making small payments every day - sometimes not even £1 but when i look back at my online account and see these transactions going to my c/c instead of debits for things i don't need (or want??) I feel good. It also feels like i am saving if that makes sense. I do have savings that some have suggested that I use to pay off my debts but in a way that would be too easy. I want to punish myself into repaying what I frizzled away. Give padding a go and you will be surpised just how good it feels - also once it is out of your account it out of the temptation of 'I'll take for xxxx and pay it back tomorrow. i think we have all been there or we would'nt be posting on here. Good luck we can do this!!

backinbusiness

I was where you are.

I went half and half - maybe not the most efficient way - but kept me happy.

(Then at the end I went mental and paid everything off in a oner from savings - just HAD to see it gone)

Good luck - you have to do the way it works for you best.

BiB

Time_to_face_the_music

If all debts are 0% interest, it's fine to save then pay them off. But if you are paying any interest at all on your debts, that interest is increasing your debt and when you come to use your savings to pay off the debt, some of it will go towards the accrued interest and make less of an impact on the debt.

You know it doesn't make sense, why ever you do it, what ever you call it. Pay a bit off every day if that feels easier, split your savings into daily payments and join us on the payment a day challenge.

https://forums.moneysavingexpert.com/discussion/4045923

For cantbelieveiamhere, it's not too easy, it's not about punishing yourself, it's about getting your debts paid off and paying as little interest as possible while doing so. If you have ANY debt with interest, it makes sense to use savings to pay it off, If you are already doing a payment a day, why don't you join the challenge too. It really is inspiring and it does make a real difference.

cantbelieveiamhere

I understand what you say Time to face the music. It might not work for everyone but I think it will for me. most of my debt is at 0% or I would use my savings, and i still might but for the time being I'm keen to give it a go.

Punishing myself maybe is not the right phrase but I do want to learn a lesson from this and am worried that by paying using my savings then I haven't learnt anything about budgeting and will then have no savings and would worry about being tempted again by credit.
I might well join you on the PAD challenge - still getting to grips with the sites.

YORKSHIRELASS

I want to try and build up an emergency fund of £500 and I am putting £50 a month towards that. Once I have £500 my plan is not to save any more unless I have to use the emergency fund in which case I will start the £50 standing order again until the balance is restored.

As TTFTM says there is no point in saving unless your cards are on 0% and even then I would be worried about being disciplined enough to not end up using those savings for something else.

There is something very satisfactory about seeing the balances come down and personally that spurs me on.

As with everything MSE its what works for you I guess so good luck with it!

eyeopener2

YORKSHIRELASS wrote: »

I want to try and build up an emergency fund of £500 and I am putting £50 a month towards that. Once I have £500 my plan is not to save any more unless I have to use the emergency fund in which case I will start the £50 standing order again until the balance is restored.

As TTFTM says there is no point in saving unless your cards are on 0% and even then I would be worried about being disciplined enough to not end up using those savings for something else.

There is something very satisfactory about seeing the balances come down and personally that spurs me on.

As with everything MSE its what works for you I guess so good luck with it!

That really is the best way to do things. I didn't and I always worry about the car blowing up or the boiler exploding ( dramatic I know).

A small emergency fund and then bang away at the debts.

E2

Jubilee76

I agree - I always think I should set aside money for an emergency fund. Have that in place for the "just in case" and keep working on the debts

Jubilee