Rejoining MSE and a lightbulb moment!

lightisfading

Hi all :wave:

So, I used to hang out on MSE quite a lot. I managed the finances for me and the (ex)OH which were sometimes very tight, and in doing so racked up some debt.

Nearly 2 years down the line, and I'm single, with ever-rising debt, unable to afford to live alone. BUT I think I've had my lightbulb moment

I've put together a plan which should leave me debt-free (not inc student loan) in 2 years, less if I manage to squirrel extra bits away.


Starting position (amounts are approximate as I'm going from memory):

• (card A) c.£250 @19% - min payments £25/mo

• (card c.£2700 , majority interest free, rest 16% - min payments around £30/mo

• (card C) c.£2700 @ 22% :eek: - min payments nearly £70/mo :eek:

• (loan) c.£1410 - payments set at £75/month

So far I have:

• paid off the £250 completely.
• consolidated the two other cards onto a new 25 months interest free barclaycard - start total £5414.38
• paid a lump sum of £800 towards that (a bonus from work).

Current status:
£4614.38 @ 0% til Aug2015
£1412.08 loan, set payments due to pay off Jan2015.

Second step ... DD set up to pay £200/month onto the CC, along with the £75/mo which goes to the loan until its paid off (and then the CC). With this alone (and no further debt accumulated!!!) I should pay everything off in April2015 :T

Next step... getting a grip on my spending ...

lightisfading

Next step... the budget!

Income: £1200

Outgoings:
Rent inc bills £400 (may go up a bit soon)
TV/Net £30 (agreed with landlady I would pay this as I'm the one who uses the high speed internet, not changeable)
Bus pass £60 direct debit (cheapest option)
Mobile £12.20 sim only... was planning on getting a new contract/phone soon but trying to tell myself I DON'T NEED IT!
Loan £75
Charity £10
Credit card - new DD set up for £200

Then the 'changeable stuff' ... as I'm only just getting a grip on my budget this is a guess and may change.

Groceries £100
Leisure/socialising £100 (I will try and minimise spending where possible, but have no desire to cut this down to nothing).
Other (clothes, additional travel, gifts, etc) £100

Left over £113.48

I'm leaving myself this bit of 'leeway' while I get used to things, and get a grip on my spending (groceries for one, I'm finding a lot harder than I should!!!). Anything left over at the end of the month will go on my credit card too.

Indebted2U

Hi Lightisfading and welcome back. You look like you have a really well worked out plan :T

I'm in a similar position and am also paying off credit cards which have been transferred to Barclaycard at 0% :j

One suggestion is something I am trying, as long as your card is due to be paid off before the 0% interest period ends that is? I pay any extra cash I have each month into an easy access cash ISA. The idea being I'm building up a cash reserve to stop me racking up any extra debt in an emergency and psychologically it really seems to help me seeing a positive balance growing each month, as well as seeing my debt reducing.

Good luck and I've subscribed :beer:

lightisfading

That's a really good idea, I will have to have a think about whether it will work for me The whole lot is due to be paid off before the end of the interest free period .. as long as I stick to it!