Not desparate yet, but need to get a grip

MissKittycat

Hello MSE forum, geek girl and trainee Brown Owl here. After a few years of thinking I was on top of things, I've done a review of my finances and found that I've more or less sleep-walked into over £10,000 of debt. I've had a credit card that I've used for minor things here and the debt on that has grown to about £2800. My mortgage has a reserve account attached, and I used that for some home improvements, so I owe about £3900 there. Finally I've just taken out a car loan for £3500 which I'm paying off over the next three years. What I'd like to do is get rid of all these debts over the next 24 months.

I've never been a good person with bank accounts, and had what amounted to phobia of banks when I was a student (years later I was still finding unopened statements in the glove box and at the back of the wardrobe). I've got past that now by joining First Direct which texts me when I hit my overdraft, so that way there aren't any horrible surprises, and I make a habit of checking my online banking every day. After reading this forum I've also downloaded a trial version of YNAB. For maybe the first time in my life I have a monthly budget (why didn't anyone tell me about this before?) with a spending goal and a stretch goal.

I've gone through my bank statements, and I'm amazed at the amount I've been spending on rubbish. Because I earn a decent wage and have a lowish mortgage, I've been able to spend whatever I wanted without really thinking about it, but in the background my debt has been slowly creeping up. It's not causing any particular problems yet, but I want it gone. So, it's time to take control and get the debt back down again so I can build up an emergency fund and start seriously saving for my retirement.

I'm hoping to get some good ideas from this forum and share my attempts to cut back. Thanks everyone for reading. I'm looking forward to being a part of this community over the next few months.:hello:

MissKittycat

November 2015 - month 1

I'm not sure if anyone will read this, but it's really helpful to me to write all this down. This is what I've done so far.

Health Insurance - Cancelled. £42 a month for insurance that I've never used.
Sky - Downgraded. The cost of the package Family bundle has crept up to £67 a month. I've switched to the original bundle and got rid of a few extras, bringing it down to £44 a month.
Breakdown Cover - So, it turns out I've been paying £65 a quarter for this. I'm cancelling and switching to a £30 a year package.
Charity - I've had a long running subscription with a charity which was costing £20 a month. Until I get things straight, that's going to have to go on the back burner.
My car insurance is due next month, and I'm pretty sure I can save about £100 on that.
My mobile phone contract runs out early next year. I'll keep the handset I have and move to pay as you go.

Pet insurance was a really tough one. I have two elderly cats, and it's costing me £50 a month to insure them including a big excess. One is showing the first signs of arthritis, so I'm going to keep the insurance on to see how that develops.

I've allocated myself £10 a day for groceries, household goods and spending money. I'm struggling a bit with that as I've had some unexpected expenses, but it is cutting down my spending quite dramatically.

I've moved the debt on my credit card to a 0% balance transfer card.

The goal for this month is not to go overdrawn. My stretch goal is to pay off £150 of extra debt.

Debt at the start of November:
Credit Card: 2800
Mortgage reserve: 3900
Car load: 3500
Total Debt: 10,200

glass_half_full

Hi there,
Looks like you are doing all the right things. I have picked up many good ideas from the friendly folks on here since I have started posting.
Good luck!!!:)

MissKittycat

Oops, I checked the credit card bill and it's higher than I thought thanks to a vet bill I forgot about (my cat had tests and turned out to have a bad case of dramaqueen-itis.)

So, the revised total is:

Debt at the start of November:
Credit Card: 2950 (stupid cat)
Mortgage reserve: 3900
Car loan: 3500
Total Debt: 10,350

I've found another subscription to cancel, only £9 a month but it all helps.

Also, I just realised I spelled desperate wrong in the title of my thread. Never start posting half a bottle of wine in, that's my new motto.

Raggydoll85

cats are such drama queens!