From care-free spender to debt-free saver

craididlyaig

I've never really thought too much about debt.

I earn more money than I need to get by on. Not a spectacular amount by any means, but my outgoings have always been pretty low. For the longest time I've just spent money on what I wanted and added direct debits for services that I wanted to use without really thinking about it. Sometimes there isn't enough money left for things I've wanted to buy so I've taken out loans, upped my limit on my credit card etc. After all: I earn more money than I need to get by on and my outgoings have always been pretty low. Right?

Wrong. It turns out that if you pay no attention to what you are spending you end up in more debt than you can manage! Which has brought me to this forum.

I've read some of the diaries on here and this seems to be massively helpful to so many people. I need to get tight control of my spending quickly and this is going to be a huge change for me. I think what would work is what some people have done with a daily diary, detailing exact spending and debt reduction on here.

So, here is my situation:

I work full time, and my wages, after tax, work out at £1339.15 a month.

I have two credit cards, the balance on one is £666.27 and the other is £1758.54.

I have two long term loans. One of which the remaining balance is £4156.80 and the other is £1659.86.

I have two short term 'pay day' loans which total £468.08

I have an overdraft of £969.99.

All this means that my total debt is £9679.54. Today is the first time I have added all this together. It's a pretty uncomfortable feeling. So, what is the plan?

I have cancelled direct debits for everything I don't really need. Unused gym memberships, Netfl!x accounts, cinema cards and the like. This has left me with (after all essentials have been paid for) £223.12 a month.

£223.12 - this is for food, clothes, travel, household items, nights out, birthday presents. Everything.

This situation will slowly improve as I pay off the shorter term pay day loans, however. But I still need to make sure I have a tight grip.

I can live pretty cheaply. I am a single guy, no dependants. I do not have to travel far for work, and no longer smoke.

The largest loan has 20 more months left to pay. I would love to have my credit cards and overdraft paid off by then. That is the goal. If possible, I would like to be able to repay this loan early also. Then, like so many others on here, I would like to use the budgeting skills I learn along the way to save up for a deposit, buy a house.

But baby steps...

Right now, I have no idea how much I actually can get by on in a month. As I said, I've never been one for paying attention. This is going to be the challenge. I am going to keep a daily log of my spending on here, for my own use as much as anything else. I will also keep a running total of my debts.

In the short term, my overdraft is not going to be going down. It's my current account, and is the only money I have access too. I have opened a new current account, and I will start getting paid into this account so I can treat the overdraft as a separate debt but for the moment I will not be paid until the 15th.

I realise I've written a lot here, and I plan to write much more in the future. Any advise or encouragement would be so appreciated.

kindofagilr

Hey, welcome

I just wanted to say a big fat good luck you sound like your head is in the right place and I'm sure you can nail this debt!

One piece of advice is, don't get down hearted if things take a few months to even themselves out, it took me a few months to get the budget all sorted and tweaked etc, especially if you've come from not really paying attention to watching every penny

I have spent quite a while sorting out a spreadsheet with a month by month page for what's due out, and also have a page for my debt, this has helped me massively stay on track.

craididlyaig

Hey, thanks very much for the luck! I may need it...

I think mindfulness, for me, is the key. I may develop a spreadsheet of my own, I'll see how it all goes. I'm hoping by posting here it'll make me think twice about what I spend! You would be shocked at the amount I throw away on takeaways.....

kindofagilr

I'm with you on the takeaways we used to easily spend £40-£60 a week on them! Now we have one once a month if that!

I'm sure your diary will help with thinking twice about what you are spending

belleandthebudget

Welcome! I'm in a similar situation - just didn't ever pay attention to what I was spending and took out debt so I could buy things I want rather than things I needed.

Keeping track is the first step!

craididlyaig

Hi Belle, from reading your posts it does seem pretty similar. It's so easy to find money to spend on something that you are pretty sure you definitely need and will definitely definitely make you happy forever so you wont need to buy anything else....

Swampy3k

Congratulations on your lightbulb moment, I was in the same place as yourself over a year ago, it's a shame it took so long for it to click for me! will watch your progress so keep me updated

craididlyaig

Thanks Davie, good to know someone will be paying attention. Keeps me honest.

I'll have a proper look at yours at some point when it's not time for bed... Congrats on pretty much paying off one of your cards though from what I can see.

ani*fan

Hi there :wave:

Just wanted to say welcome to the forums and good luck with it all.

AFx

craididlyaig

Why thank you, ani*fan.

So, today I was very careful. I ate breakfast at home, which I never do (saving myself my daily £2 spend at the bakery on the way to work) and I also brought food to work with me.

I spent £68p on a bottle of water on the way to work (planning to reuse the bottle for tap water and save myself money on endless Dr Peppers at work) and bought a load of bread for £1.

However, I arrived home to a message letting me know that my TV licence is due this month. Marvellous. So my half of that is £72.75. Is this doomed to failure before I've even begun? Possibly.

Naa, positive thoughts. So far, on this first budget-testing week I've spent £1.68. I'm not counting the TV licence...

moneyonmymindsam

Welcome:j:j


Could not just read and run. Firstly well done for tackling your debt and admitting your finances.

Have you completed a SOA so you can budget for all area's ( you don't need to post it just helps to have a budget )


In the beginning when I started my debt Journey I lived off £5 a day for a couple of months ..then upped it to £10 a day and felt I lived like a king...lol


It does get really tough but when I am feeling low or things just aren't moving as fast as I'd like I just make an over payment to a credit card so that I can see something going down.


Shudders at PDL - any chance you can move this to CC?


Thought about selling any of the stuff you own on ebay ...Can easily make £100 a month even if you don't think you have anything to sell.


Another option is think about a second job ( :eek: ) evenings or a weekend day?


Is so easy to spend on Food so well done on keeping this under control :T :T :T but PLEASE don't starve and don't suffer as you will get bored easily and give up.


Keep focused and keep logging on plenty of lovely people here to cheer you on.


Stuff is only stuff ...so if it's not nailed down think about selling it as you will probably be going out less and debt busting more so a good old declutter to make your home environment stress free does help..:D


Have you worked out a debt free date yet ? as this will help to keep you motivated.


I only buy food reduced and on offer and saves me a fortune...I went to the till and the young guy serving me said what no reduced sticker you have been robbed ...:rotfl:


Sometimes I see the same people at the reduced section of our supermarket and they just smile and say lets see what's for our Tea ...I'm not embarrassed to be paying off my debts ...I get to eat some amazing food for 9p sometimes:rotfl:


Think of foods you like and try to meal plan Cereal,Jacket potato's, eggs etc ... it is very easy to go to the shop for milk and end up spending £5 or £10 on food you just fancy.


Good luck will be wishing you well all the way


MMSam
:beer: