Debt Free Progress

arsenalmorris

Hi i am new to the site, I am currently in the process of getting debt free and am gonna use this as a progress thread and also see if there is any better advice i can get to help it go down

We started of in April 2013 and I was just over 13.5 k in debt, I realised I needed to get rid of this,

I decided to make a spreadsheet of all my debts (best thing i have done) to keep a track of my progress, From this is fill it in every Monday with the debts I have and from this can see the amount falling which keeps me focused.

I now stand just over 12k in debt which may not sound like I have knocked a great deal off in 10 months but in that time I have also moved out and furnished the house I have moved into.

I currently owe:
Loan £8100
Credit Card 1 £800
Credit Card 2 £3150 - interest free

My basic pay is abut £1450 take home after tax and there is always overtime if needed, My out goings are low, I dont pay no rent as its my dads house and all the bills come to about £250 a month then petrol and mobile means my outgoing a month before debts are about £400

As you can see from the outgoing I have alot left over each month and it is allowing me to pay off great chunks each month and means i dont want to change my quality of life to much in regarding to cancelling Sky or getting a cheaper mobile phone

This month i have worked 84 hours overtime all at time and a half and this amount on its own is going to clear Credit Card 1, Then the main thing i am wanting to ask is which would be the best way of attacking the other debt, i will be wanting to pay about a extra £5/600 a month off my debts, would i be best paying this off the loan each month or getting rid of the credit card and just continuing the £200 a month on the loan till the other credit card has gone,

Also i am wanting to save for a new car aswell as I keep having to repair mine quite alot so want something alot newer and more reliable I wont have problems with, but am not getting this till at least both credit cards have gone,

ikesmummy

How long is your second credit card interest free for? Also do you know what happens if you overpay on your loan, I think often it doesn't effect the total repayment amount and so putting the money in a high interest account can work out better but to obviously need to quite disciplined to do this and not dip into it.

I would probably start putting any extra towards the second credit card once the first one is played off in full.

Sure others with better more experienced advice may have other things to add.

Well done on your progress so far

arsenalmorris

ikesmummy wrote: »

How long is your second credit card interest free for? Also do you know what happens if you overpay on your loan, I think often it doesn't effect the total repayment amount and so putting the money in a high interest account can work out better but to obviously need to quite disciplined to do this and not dip into it.

I would probably start putting any extra towards the second credit card once the first one is played off in full.

Sure others with better more experienced advice may have other things to add.

Well done on your progress so far

Thanks for the reply, The 2nd credit card is interest free for anoter 21 months so if fine and i should be able to clear in it about 5 months the way i am going.

The other thing about the loan i question is i currently have 47 months left at £200 a month, if i pay back a extra £600 a month will it just lower my monthly payments each month for the remaining months or will it knock 3 months of the end of it (preferred)

ikesmummy

Not sure if how the extra payments effect it varies between loans but would think you may be best checking with the loan provider, like you say would be great if you could reduce the term of the loan and bring your DFD forward as much as possible.

Best of luck

arsenalmorris

So Spured on by what i have read i am hoping to complete the below this year although its a tall ask

MBNA Credit Card - £850: Pay this off completely, (will be paid off fully next week on pay day as the amount of overtime i have done this month will cover this easily.

Natwest Credit Card - £3150: Pay this off completely, Will crack on with this next month when other card has gone,

New Car: Looking for a new car in the next few months after the 2 cards have gone (VW Golf GTI) for around £6000 depending what i see, Hope to have about half of this paid off by end of this year (borrowing from dad interest free) hopefully more depending how much i get for my car

Arsenal Season Ticket: Should get this for next season, prob looking about £1100 for the year, and should have enough saved up to pay it off

Also will be another 11 Payments of £200 off my loan, so after interest thats about another £1800 off that

Scritti

All sounds good to me. You're doing really well - keep it up and I wish you the best of luck!!

Firewalker

If the NatWest card is interest free for another 21 months I'll target the loan (given there are no penalties for overpayment) after dealing with the smaller card. In fact, I won't bother paying off the NatWest one till the end of the 0% interest period - just make sure you have the money to pay it off in a savings account.

Firewalker

arsenalmorris

Thanks, I may consider putting the money in a savings account instead of paying it straight off the card,

Also got my Payslip after leaving £450 spending money and £250 for bills i have about £1400 this month to throw at the debts,

Gonna clear £900 off Credit Card 1 so its at 0, Then after i pay £200 loan payment i will have got £300 left for the other credit card / savings account payment

arsenalmorris

Payday today so i have made this months payments,

£196.57 to loan (£7956 remaining)
£923.35 to CC1 (£0 Balance)
£279.15 to CC2 (£2870.04 remaining)

feel alot better now, also paid a few other bits of cash i owed people and put the monthly amount into the account i use for household bills leaving myself with £420 for the month (£15 per day)

arsenalmorris

Had a good month last month, Started with debts of £12,233.56 and now its Payday today again and i have only ended up putting £95.15 back on a credit card so current debts are £10,909.81 so im £1313.75 less in debt than i was a month ago.

This months payments are:

£196.57 to loan (£7757.65 remaining)
£95.15 to CC1 (£0 Balance)
£425.75 to CC2 (£2434.69 remaining)

A total of £717.47 to be paid off this month

arsenalmorris

Another pay day is here, Worked most days in April so took home a good pay check

This months payments are:

£196.57 to loan (£7606.33 remaining)
£643.42 to CC1 (£0 Balance)
£650.69 to CC2 (£1750 remaining)

Total debts now stand at £9356.33 and i have managed to save myself £550 spending money for this month after my bills so save me being short and having to put any on CC1 again. If i can keep spending down on CC1 the next few month i hope to have CC2 paid off in the next 2 months as i have alot of overtime schedualed in for the next 2 pay days.