Trying to pay everything off

lea_t88

Hello!

I wondered if I could join the lovely people on here and have somewhere to write down my progress while I try to pay everything off.

I'm not sure if this counts as a lightbulb moment but I have had a BIG realisation that I am quite frivolous with money (Gucci shoes, LOTS of new clothes, a new wardrobe to house the new clothes, artwork... list is unfortunately endless). I have decided to try and save for a house deposit but need to get rid of the debt I've got first.

Probably best to write it them down here in black and white... so here goes.

£3882 on a Natwest credit card. This is 0% until May 2013. I am getting points for this so spend as much as possible on it and then usually repay around £700-£1000 each month. It has this big balance from my car insurance, 2 x recent holidays and some designer stuff

£3796 with a Natwest personal loan. This was a £7500 loan I took out to buy a new car in May and have overpayed £3400 as well as normal repayments so very happy with this progress. :T

£0 overdraft. This was -£2000 at the start of the year so have paid this off. Now have £1000 available with £500 interest free but never go into it.

So total is £7678... all aquired since May which isn't great.:eek:

Now for the tricky bit. I am a freelance worker. I go from contract to contract ranging from a few weeks to several months depending on the work. I have never struggled to find work yet but since moving out of London, the work may not be as readily available anymore. So I never really know when I am next going to get paid. I am currently working for the next 3 weeks and should be paid £2100 (after tax) at the end of October and then I'll be on the hunt for work again.

My necessary outgoings per month are very minimal.
Approx £50 per month on my phone. Essential for work.
£100 for bills (moved back with parents)
Usually around £80 on petrol.
£20 to charities.
Possibly £50 a month on food.

I just need likeminded people to make me see sense, rather than the people in my life saying 'Yes OF COURSE you need those shoes/those clothes'! My biggest downfalls are eating out, coffees on the way to work, online clothes shopping, toiletries and perfume (got enough to stock a Boots), art/pictures and books. So any tips people have to cut back on these would be gratefully received.

I am working from home for the next 2 weeks which cuts out a lot of petrol and snacking/food buying at work

So that's a bit about me, and I hope to post something every so often so I can see progress and also be publically shamed if I have added to the debts!

Thanks so much for reading

lea

lea_t88

Tomorrow is my first day off in a few weeks and I've decided (after my lie in) to go through my clothes and get rid of stuff I don't want. I did an ebay sale a few months ago with good results, got a couple of jackets etc I don't want.

Another thing I forgot to mention is I am massively addicted to loyalty points. At one time I had £300+ on my Boots card. So this year I am going to spend my Nectar points (around £90), Advantage card points (£105), and my Valued Opinions vouchers (currenlty £36), on Christmas presents . I have a MASSIVE amily so this won't go far but will help for a few of them.

I can feel Christmas coming already this year. It's these cold dark nights. I love it!

lea_t88

:wave:Morning

Woke up today to an email from MBNA. I applied for their BMI Credit card last week (spend £250 in 90 days and get 20k bonus avios miles).

Email said I've been accepted and my limit is £5800 :eek: not too sure how I feel about that. So with only 2 credit cards to my name I have over £12k credit. That's a bit scary isn't it. Not sure whether to lower it or if it looks good that I'm using less of my available credit.

Anyway, going to go through all my excess stuff today and get an Ebay box together for selling soon!

Rainbow_Bridge

Hi lea_t88,

Well done for addressing things before they become critical, and for having a healthy credit rating !!

It's very easy to spend money on all the things you have mentioned, all of which I have enjoyed spending liberally on in the past too, but your goals are changing. You want a house, so your priorities are changing.

The thing that has made a massive difference to me is just posting on here each day and keeping focused. Waking up to the fact that I was spending £730.00 a year just on coffees, and dreaming about what I would rather be doing with the money.

You can do this x.

unimaginative_user_name

Hi Lea and good luck with your debt-free journey.

Have you tried Martin's demotivator tool to work out how much you spend on coffees on the way to work etc. You have to type in how much you spend per day/week and your salary and it calculates how much you spend in a year and how many days you have to work to pay for it! (I know your income is not regular but you could estimate it based on average earnings in the last 12 months.). One you have your calculation you can print it off and stick it in the fridge or in your wallet to demotivate you from spending.

lea_t88

Thanks so much both for your encouragement and kind words, it's definitley a priority shift!

Will check out the demotivator tool- not sure I want to see how much it costs haha especially when you factor in the croissant I got with every coffee but will do me good to see a figure in front of me before I do it again!

lea_t88

I did a rough guide at a coffee and a croissant for every working day in the past year. On the days where I didn't get these then there was always trips to the Sainsburys local next door to work, or Frurt (damn that tasty frozen yogurt) so definitely will add up to at least one a day.
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£1000 spent on vanilla lattes and croissants:eek::eek:. a THOUSAND pounds.

I'll swear to anyone that I don't even like coffee, it's only the warm drink and vanilla that I like. That's a tenth of my house deposit!

lea_t88

DRAT- Had the news this morning that I won an iPad at my last job (finished last week) but they had to give it to someone else because they got my out of office when they emailed me.

Haha due some comeback karma now I think.

On the plus side, loan has gone down a smidge (normal loan payment came out) and credit card has stayed where it is so better than having spent more on it!

Working from home today and have stocked up on food/cereal so I'm not tempted to buy anything!

lea_t88

Evening/Mornig all :wave:

I've decided on a whole new approach to my saving.

Because my card is 0% until May 2013, I'm going to leave this for now. I have a DD set up for minimum payment every month so know this will be fine. Will pay an extra few quid so I don't get a 'minimum payment only' marker.

In the meantime I'm going to pay as much off my loan as possible, as early as possible. I have a few hundred pounds in my current account available which I was saving as I'm not sure when next payday is, but I can pay the majority off my loan and still have the i/f OD available if all goes t*ts up.

This makes complete sense to me now, as why was I rushing to pay off card when it's not accruing interest? Pay loan off asap, then everything else in the ISA. In May, pay off card in full and any savings left are the start of house deposit. Might've had a bit of interest too.

Kicking myself now as I paid off around £1.5k of my card the last couple of months and my loan could've been halved by now. Oh well- onwards and upwards!

Still haven't done my Ebay box. Must must must do that soon. And also sell my old Blackberry to money-for-mobile site

Lea

Frugal_Saver

Hi there, what a brilliant start you've had.

Changing spending habits does not happen over night, it's taken me a few attempts and I'm still in the early stages of budgeting. Like yourself it's only now I'm looking into the best way to repay debts that I realise just how much interest I was paying previously without realising it.

lea_t88

Thanks Frugal, it IS so difficult to get out of little habits isn't it. I just had to do a bit of driving for work and had to give myself a virtual pat on the back for not stopping at McD's drive through or any other food place on the way back. I've got mushroom stirfry which needs eating today and thought of throwing it away pinches more than it used to!

Can I ask (any readers) - when you're budgeting is it simply a case of writing down everything you may need to spend and not going over it? I haven't yet put pen to paper but may do if if stops you going over your planned spend.

Good luck on your journey too Frugal Saver!