The have’s, the have-not’s, and the have-not-paid-for-what-they-have’s

burty_budget

First post! Whoop and also the start of my getting out of debt diary.

The Past
Over the last few months I have been starting think less about the now and more about the future. Over the last few years, through reckless spending and expensive OH's I have found myself in £35k of debt. Ouch. Not bad since 2005 saw me become debt-free from a previous stint of reckless spending.

A mixture of stupidity and lack of care has led me to this place. Stupidity because more often than not I didn't even bother to look in to the total cost of buying something on credit. Credit cards felt easy to spend on as it never felt like my money, I made constant choices of I have £1k in my bank but if I spend this £500 then I will only have £500 left. Whack it on the card and pay it back at the end of the month if I haven't already spent it.

So there it is, my credit past. I had a good time, I can't deny it.

The Plan
However, now is the time to right my wrongs and pay back my debt. To use my modest income to it's full potential and get on the housing market.

The last 3 months
This isn't exactly day one. So here is a recap of what I have done so far.

Tried to take back control of my money!
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Tried to figure out where all my salary was going. I couldn't account for around 50% of it a month. Drawn as cash.

Cancelled various things I haven't used such as Gym subscription and an insurance I had paid for over a year without realising.

Kept all my reciepts and printed out bank statements and recorded exactly where all my money had gone.

Budget!
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Using that information searched around for some budgeting software, nothing really cut the mustard until I stumbled on YNAB and read through their sales bumph. I now had YNAB!

Now I had to visualise my debt, my outgoings and my situation. It wasn't that I was struggling to pay but seeing everything there suddenly made everything real. I had some vague idea of wanting to stop renting and getting myself somewhere of my own, this wasn't going to happen like this.

Debt consolidation
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I then decided I would try for a loan to get money of these credit cards and loans get it in one single payment. Make sure I can over pay it. However I was struggling to get credit, long story short I have a loan now for 11.9% APR for 25k and was told I wasn't going to get a better rate as a person with my disposable income should not have that amount of debt.

So after a windfall £5k from my parents, the loan paying my debts off I had one Barclaycard and a Loan.

£25K Loan
£7K Barclaycard

Thanks for reading! To be continued...

burty_budget

Current state

Loan: Estimated £19200 - 5 standard payments and overpayments of 2989.22 (11.9%)
CC: £8294.81 Limit £9500 (6.6%)
ISA: 800.11
Savings: 65.70

Budget
Salary £3332 after tax
Other £350
Outgoings:
£784 Debts
£857 Bills
£100 Business running costs (side business I am setting up)
£80 Groceries
£76 Smoking
£20 Fuel (work from home)
----
£1917

£750 Savings for House deposit
£800 Overpayment on loan/debt repayment

Budget here is not exact but close enough. I am hoping to overpay my loan by £800 + whatever else I can drum up month by month.

I am aiming to get my loan Payed off by June 2016 at the latest! With that done I should have a good sized deposit with my OH.

Places I found money recently
Looking around these forums and this site has given me ideas for getting some extra cash.

I signed up to Quidco and hit some of those free offers, EE sim card PAYT for £7.50 and a gocompare search for £1.75 ish. Will keep looking at that when it comes to insurance renewal etc!

I phone my bank about a loan I had between 2008 and 2010 as it appears I am due redress for interest through that period. Apparently I have not been processed yet and should ring back at the end of Feb to chase if I haven't seen anything. Fingers crossed.

Got my annual statement from First Utility and I am £690 in credit! Asked for a rebate, but have to provide a meter reading on the 5th and wait for my Feb bill on the 14th...

Had an old HSBC current account I don't use so switched it for a Halifax account and £100 bonus. Still waiting for that to complete.

Sold a hoover I no longer needed for £80.

Sold my iPhone 5 for £120 as I got a free upgrade from Three.

Looking good this month for some big overpayments if everything comes through!

burty_budget

While browsing Quidco I noticed a 12 month BT 0% fee Tesco Clubcard Credit Card offer. Just been accepted for £5.7K so transfered £5.4 from my Barclaycard. Also, all going well, I should get £25 cashback as well!

After it's up and I transfer the balance again I think I may use this to get extra clubcard points when doing my normal spend!

twiggy86

Hi BB!

Well done on your progress so far and starting a thread on here!

One thing I will say - please, please, please make sure you cancel your credit cards which you have now consolidated and lower your credit limit on your Bcard. I have read numerous posts on here where people consolidated their debts only to run up further debt on their once cleared credit cards. I'm sure right now whilst you're in serious debt busting mode you don't think you will, but don't leave the temptation there!

Good luck!

burty_budget

twiggy86 wrote: »

Hi BB!

Well done on your progress so far and starting a thread on here!

One thing I will say - please, please, please make sure you cancel your credit cards which you have now consolidated and lower your credit limit on your Bcard. I have read numerous posts on here where people consolidated their debts only to run up further debt on their once cleared credit cards. I'm sure right now whilst you're in serious debt busting mode you don't think you will, but don't leave the temptation there!

Good luck!

Yeah been there and done that before. I had 3 other credit cards before my consolidation loan which have all now been closed down.

I do need a little bit of a buffer on my Barclacard at the moment as I will have savings in an ISA for the deposit for the house but do not have an emergency fund as all my spare money is going on debt repayment.

I did have to use my Barclaycard last month as my MOT was due on my car so £700 worth of work later it passed. I did have the money budgeted in the next month to pay it off but decided to pay that off my loan instead. Saw it as a free transfer from a 6.6% CC to a 11.9% loan.

Oh and after all that work, decided I would find out how much my car was worth as I don't really use it. But was offered £75 by webuyanycar... less than I got for my iPhone - crazy. They go for around £3k on Autotrader. Still undecided about selling that though.

burty_budget

It's Friday and nothing really new to report. The OH is struggling a bit with the new budget regime and it is a regime. But after conversations we know what we are aiming for and both agree that is worth the effort.

Still waiting on completion of new credit card, Halifax account, phone sale and loan interest repayments so no extra debt payments this week above what I have already done.

Just a little frustrated that I can't get rid of all this debt yesterday, but I suppose it was that kind of thinking that got us here in the first place!

Onward and upward.

burty_budget

Well here is an update of what I have managed so far this month.
Barclaycard: £220.07 (normally £190.00)
Loan: £972.97 (overpayment) + £593.14 (standard payment)

So total overpayments so far: £1003.04

Saved: £59 (for car tax and car insurance)

Still think I can find some more money this month. I used to play poker, don't worry I played because I liked the maths behind it all, I logged in to my account for the first time in ages and found $87! Just hit the cash out button! I also found I had some reward points, I couldn't convert them to cash so have converted them to a $20 donation to cancer research UK.

Still waiting on transfer bonus and other things for this month so may be able to get another £200+ off my debts!

Oh and got my Tesco vouchers this month. £5.50 in cash and a few coupons that should help with the shopping bill this month.

And finally, found £1.90 in my national lottery account. You cant withdraw less than £10 so got a scratch card and won £10. So transferred all that back out to my account.

burty_budget

Had a bit of a slump for a couple of days as I thought I was running out of things to throw at my loan. However, after seeing my OH's debts get reduced and finding money around the house I am beginning to feel as motivated as ever!

Found £12.70 in penny jar, car and around the house
Free'd up: £17.89 from budget
Payed: £80 from winnings above

So total of £110.59 payed off the loan!

Totals so far this month:
£593.14 Standard payment
£989.22 Overpayment
£110.59 Overpayment this week

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£1692.95

Now I have been thinking harder about selling the car, think I am definately going to do it and will insure my self on OH's car instead and have her a named driver. Should work out cheaper for her and I get to keep my NCD.

Found a 5th Gen 80gb iPod in my draw going to eBay that after I have checked it is all still working!

Boxed up some old CDs and sent them off to CeX should get about £25 from that.

Still waiting on switch bonus, refund from gas/electric and interest refund from First Direct.

Things just can't move quickly enough for me at the moment lol.

twiggy86

Sounds like you're doing really well! You've got me wanting to search out money from around the house etc!!!

MessyBetty

Hi burty

Wow congratulations on your achievements so far, your determination is certainly paying off, how motivated are you :money:

Keep up the good work I will pass bye from time to time to see that you are on track

MB x

burty_budget

Thanks twiggy86 and MessyBetty for stopping by!

Now people are watching me, I will have to stay on the straight and narrow