Start of plan to be debt free

surfamakikomi

Well after getting in a tight situation recently, last month I managed to take some action on trying to be debt free. For the last few years I was using bank cards and credit cards without really paying attention to the balances until it was too late. Last month I decided to do 2 things:
1. Take out money for the remaining month and give cards to the missus.
2. Speak to a debt advisor about my debts and how to put them right.

The outcomes have been so far:
1. The debt advisor has set up a dmp to deal with the debts with the first payment scheduled for today. The advisor was brilliant here as the monthly payment is lower than I was paying but he worked with my outgoings so that I would have some money left to save for a rainy day. This amount is probably larger than it should be in fairness to my creditors (as they gave me the credit) but it will allow me to save money to start paying them off in a lump payment.
2. I have set up a basic bank account with no overdraft and moved all my direct debits and salary there.
3. By using only cash I managed to keep money in my account come payday around £150. This is a first for me for a long time (about 5 years probably).

It is hard sometimes driving to work thinking " do I want the mc donalds brekkie" or stopping in the supermarket on the way home when hungry. The thought of having savings and not wanting to go back to bad habits has lasted so far .......

Bring on october

Summary:
Debts: 3.2k Overdrafts , 7k credit card , 1.2k loan.
Months Left: 47

Mizen79

Good morning,

Wishing you all the best of luck.

I am just starting a similar journey, so I can understand your difficulties with breaking the bad habits.

We can both do this!

Do you have a date you hope to be clear of debt?

Tixy

Hi

Great that you have a plan and are feeling motivated to keep your spending low, it does become habit after a while so becomes a bit easier as time goes on.


Did you go with the a free organisation/charity for your DMP in the end? or with the fee charging one? Hopefully you went with the free one and saved that £4k odd in fees.

surfamakikomi

Cheers for your reply Mizen,

I am sure we can do this. I didnt have a date in my mind until you mentioned it but I am thinking that if I can be debt free before in 35 then its progress (4 years 1 month away). I hope that I can clear this in 3 years though by saving up and making extra lump payments to clear some things at once.

Cheers

Calling14

Well you have start on the debt free journey. Well done you. Similar amounts to me may have to add another 900 pounds to mine - house repairs.
Good luck, this board and the many challenges stops impulse buys. Try one for October.

surfamakikomi

Tixy, I did go with a fee based company but i do not intend to stay with then longer than a few months after the dmp is set up. I was thinking about changing during the 1st month but the guy did go out of his way to make the budget a bit better for me to get some savings (my car has 223k miles so this could bring cost anytime) that I think a free company wouldnt have let me do. As soon as its set up and settled I will probably move the plan over.

surfamakikomi

Well things got a bit weird yesterday ...

The dmp company is curently in the process of getting up to date balances and making offers but I went into my bank to get rid of my platinum account and go back to a normal account because I wasnt using the benefits. The woman I was talking to was trying to offer me a loan to consolidate my debts. I said that I have a large amount of debts (12k to me is a big) but she said that wasnt a problem as her system says that there us 13k available to me!!!!!

Normally I would have bitten her hand off but this new me said I'd think about it and have decided against more credit . I totally didnt expect a loan offer from the bank.

I have now also set a debt free date: 31 September 2015. Its suprising how much of my income I wasted. 2 months ago I spent more than I earned that month. This month I should have about £250 to put into a savings account. I know I should be putting this against the debts but I intend to pay them off in a lump sum rather than give the dmp company more money every month before I switch.

Feeling quite good now

:T