Looking after myself financially

misskl

So.... I had my 'LBM' in January of this year when circumstances forced me to move home (grandmas), and I had racked up debts of circa £12,000 (In total, I had borrowed £22,000 but paid things back, and got out more credit).

I am 29, and now single, because everything got too much and I'm finding it MUCH easier to deal with my debts by myself...I can be really focused, and use my spare time to earn money (just signed up to be a disney princess at kids parties!)

Like many of you on here, I have really analysed my relationship to money following my LBM, and realised the main reason I have been spending is because I am BORED with my life (career). I have fell into a corporate marketing job, which is SO not me at all (note the Disney princess pastime;)). I have been unfulfilled for the past 4 years or so.

So I have really been thinking and researching, and I am considering being an ESL teacher, starting off with a (temporary) move to Singapore! You can earn and save a good amount (more than here!). I plan to move in Sept (by which time I will have sold my car to pay off most of my loan, and my credit card will be gone too), but I will keep you all posted how I do! I might be lonely out there so I will pass the time by updating my DFD!:)

It's time to look after myself:T, because I've finally realised that the great feeling you get from indulging in something is NOT WORTH IT if you havent got a decent enough 'cushion' to enjoy it, and you will probably be setting yourself up for more stress if you can't actually afford all this stuff...security is my new middle name!

misskl

So, my credit card will be paid off next month (I had £2796 on it last October!) and I am building up a nice amount of savings. I am working all hours though, but it is important to me I get out of debt fast


I plan to sell my car before I go away, and I think as it is still relatively new I can get circa 5k for it, which will mean my debt will stand around £2800- hopefully I can clear that in less than a year.


The main test for me will be what happens AFTER I pay all my debt off... whether I commit to putting a good 20% of my income into a savings pot for a house, and 10% into my emergency/lifetime fund.


I really really hope I can do it. It will be a massive corner for me to turn, and will impact my self esteem no end. I am almost 30, time for me to be financially responsible!

Brightspark87

Great story Misskl I look forward to hearing more from you soon!

misskl

So my situation has changed a little bit- I am going abroad to teach next year now as I've just found out my sister is having a baby this year


My remaining debts:
1. £280 on Virgin Credit Card- to be paid off and closed down at the end of this month (this was £2796 in Oct 2013 so I am proud of myself!)
2. £7913 remaining (I have between 5 and 5.5k secured on my car).- I have worked out that if I continue with my loan repayments (£226 a month, fixed lifetime rate of 5%), I should have about 1k to clear by the time I have sold my car to go away next year, hopefully I will have saved enough to do that.


Savings:
1. Emergency fund - 1k so far, but I want £3k as an initial starting point (I know many people say pay off debts, but I have never saved this amount and kept it and my loan is already at a fixed rate so the interest has been added from the beginning).
2. CELTA- £0 so far I want to save £1200 to complete a CELTA course. This will be done just before I go as it is a whole month out of work.
3. Teeth- £430- I need my teeth fixing, it costs £1700.
4. House savings- once the above has been done, and debts are cleared, I aim to save £40k by the time I am 35 for a house.


I will post my progress here!!!

misskl

**UPDATE** August 2014


I'm doing well. I have started to pay an extra £300 into paying off my car loan now I have cleared the credit card, so I am paying a whacking £556 a month on the loan! On top of that I am saving £165 a month into emergency, and around £50 for having my teeth fixed (I have a second job that is funding me for this also).


One thing that is still slightly perturbing me is that I am feeling guilty whenever I spend money on clothes/jewellery/hair etc... ironically these are the things I have the most desire for, and weren't the things that got me into debt in the first place (it was to set up business, car, and socialising). I read on here recently that reducing debt is like dieting...you need to allow yourself something naughty every now and again just to stay sane.


I worked out my percentages the other day.
I am saving 11% of my salary in an emergency fund, paying off my debts with 34% of my salary, and living off 55%. Quite a stretch, but not too bad. I am telling myself that if I buy myself a £12 necklace with this 55% it is ok, because I am doing really well with my debts!


Once they are cleared, my plan is going to be:
10% emergency
30% savings (maybe split into 20% house, 10% for big purchases like laptop, holidays etc)
60% living


And I hope to continue this for the rest of my life! Can I do it? I hope so...

pinkgiraffe2014

Well done with your progress so far. I look forward to reading your updates.

misskl

So my DFD is coming to an end....!


I unfortunately had an accident in my fairly new car, not my fault, was written off.


I have come to a settlement figure of £5700!


I am happy to go car less for the time being, I don't need it for work and finally, for the first time since I was 18, I will be....(drum roll)




DEBT FREE!!!!!!!!!!!!!!!!!!!!!!


Honestly the relief I have had financially is about equal to the relief I feel not being injured in the car!


Debt dragged me down so much, made me feel worthless and not good enough.


From my LBM last year I was £12,000 in debt last October, and very depressed. I decided that I was not going to be a person who borrowed, ever again, and set myself up to earn and save as much as possible.


Now I can properly start saving, for my future, my home, and anything else!


So happy

misskl

Just as a note to anyone that reads this. The loan was taken out to consolidate overdrafts and buy a 6k car, and I borrowed £8,500 August 2013 (but it was about £9,300 with the interest). Coupled with the credit card of £2700 it was a lot (12k), to say I earn 26k.

MrJester

Really nice to hear your realisation as to why the debts occurred in the first place, boredom I think is usually a huge reason for a lot of people, they get in debt to continue having a good time, but eventually the stress of it always hits the person in question, and they realise what they have just done.

But you sound like you're on the right path keep it up