Staying debt free

Purplesky_2

Granted, I've only ever had mortgage debt, so I don't know the struggle of becoming debt-free. But I have had experience running a smallish budget.

Do you meal plan?
Do you look for vouchers or coupons before shopping/eating out?
Do you have a set price for presents in your head? (For instance, <£5 for extended family, <£20 for immediate family and <£75 for the person I love seems adequate. Off hand presents, generally no more than £2-3). You would be surprised what you can make or buy for those amounts, if you listen to people.

Are you adequately insured? In case of life/job loss particularly.
Have you written down your goals? (Increases the chance of you hitting them...)
Do you send money off to be saved at the same time as your bills (reduces pain)?

Newlifer

Great thread, hope you don't mind me joining in.

Some really useful suggestions so far. I've got an unusual situation of having unknown size likely future debts. My husband wants a divorce and with virtually no savings (as I've been paying off the mortgage) I'm now going to be faced with solicitors fees and all the costs associated with moving and then setting up a new home. All feels rather daunting right now. Previously I've always had a target to aim for but now need to just try not to drown with the increasing negative numbers or make myself I'll with the stress of it. Has anyone who has been through a divorce managed to find some decent motivators to keep them going? I'm naturally a v positive person but it's feeling slightly overwhelming just now.

I'm so impressed with the stories of debt reduction/ eradication on here. Getting to a positive financial position would be wonderful.

Teacher2

"Her definition of being able to afford is that we have the money and yes we do. "

Your wife, by saying this, is not taking into account that while you have the actual cash now, you might need it to pay a debt tomorrow.

You need to make an annual budget of outgoings and bills & liabilities. There's no point spending all your cash in February if you are going to have a bill of £200, say, to pay in June.

Add up your annual liabilities, those which you cannot avoid paying like council tax, utilities and mortgage or rent. Divide them by the twelve months in which you will be paid and then ensure you put by this sum (and a little extra for an emergency float) every single month. Sometimes this 'bills' account' will be in credit and sometimes it will be a little down, but over the year you'll have enough to meet your liabilities. If you put it by in a savings account you might even earn a little interest.

What this will do is make you more savvy about your money and then you can start having separate accounts for other expenses like travel costs or a holiday fund. You will then start managing your money instead of it managing you.

On the question of 'owing' a meal, download some vouchers for a nice food chain and use them for your pay-back meal. Pizza Express do some stinking discounts on voucher sites, for exaple, as do Loch Fyne and Zizzi. Then, don't eat out until you are on top of your finances as it is very expensive to dine out.

As for chocolate and chocolate cake, you can make a cake better than any you can buy for about £3.50. (Actually, now I think of it, that's not true as nothing beats M&S's 'Extremely Chocolatey Cake', but still, needs must.)

I also think you need to get your wife on board about retrenching. Her position, that she both sneers at your ability to save money and at the same time wants you to spend £15 on an Easter egg, is not consistent. She earns more than you so can save more, it's as simple as that. You need to be singing from the same hymnsheet on the saving front. Recruit her to help you and (tactfully) suggest that while helpful guidance is welcome, negative criticism isn't.

Good luck! It sounds as if you have the knowledge and willpower to succeed.

steveouk

So its been a fair while since I posted in this thread and I was looking back and it was useful to re-read people's advice.

Since the last post we have had an expensive 2 week holiday to Cuba - but it was well worth it and I had saved hard in the months running up to it. And we had a great time.

I am trying to go on a bit of a money diet this month as well as a food one too!

We spent quite a lot on our joint credit card last month but did some nice things - like going to watch rugby world cup games that we may not do for many years.

Think I am going to pick up on the suggestion of saving 10k but I wonder how long this would take?

steveouk

I suppose one thing that has made me think about debt is the large credit card bill last month - which is manageable to pay off as it just means a little less going into savings. Also I have had to juggle a little with having put some money onto my credit card but it was about £250 so nothing massive. now I will have to pay off the cost of anew mobile phone I put on there but that's all on there - £160. It made me think I should just have a separate pot of a few hundred pounds for "emergencies" like needing a new phone. I say it like that as the one I had just suddenly would not hold any charge at all. I know I could have got a cheaper phone but I do agree with my wife in that sometimes its worth spending more to get something better and make it last. The new phone I have got is actually marketed as a budget smartphone and the battery life is amazing. I plan to take care of it and keep it as long as it will last. Also I am only a sim only contract which is good value and I got through a cashback site.