Having a bit of a flap

123rottie

"Cash" is a loose term... it's a combination of my money and my overdraft really but yes it's for rent so I don't really want to use it to pay off my card as I'm worried I'll end up in a stickier situation if I then don't earn enough for my rent one month if you see what I mean. I am rather tempted to put a chunk of it onto the card but again, I worry about being short on rent.

I am very fortunate in that my parents pay my insurance (it's on their multi car policy anyway, I paid for my share when I was working full time but they've kindly let me off now) and when anything does need doing they help me out with it. I don't need it at university as such - I barely ever use it, the £40 is pretty much how much it costs me to fill up a tank and that is an over estimate as I don't ever use a full tank of fuel a month! I have it with me as it is faaaaaar more expensive to get the train home than it is to drive home and there isn't really room on my parent's driveway for it, it's a pain in the bum to have it at home for them. Tax comes out of direct debit and is included in the SoA of about £12 a month. Selling it really isn't an option as my parents home is in the middle of nowhere, I am one of those people who passed their test almost as soon as they turned 17 as the public transport is absolutely shocking and if you want to work you basically have to drive around here. I don't need it to get to work when I'm at uni as I walk but when I'm home I need it and when I graduate I will absolutely need it to drive to whichever job I manage to get.

Clothes I've only put about £15 a month - that's just for essential things really like if tights (which I have to wear to work) get holes in or anything else basic like socks etc need replacing, I don't really ever buy new clothes any more!

I'm hoping I'll be spending less money on socialising etc this term, I have a LOT more deadlines than last term so will definitely be socialising less. I was also getting into a new relationship last term so expensively dating but now we're a bit more settled and both of us have said we're going to try to commit to eating out less, cinema less, etc so fingers crossed entertainment will be cheaper.

lambda

123rottie wrote: »

"Cash" is a loose term... it's a combination of my money and my overdraft really but yes it's for rent so I don't really want to use it to pay off my card as I'm worried I'll end up in a stickier situation if I then don't earn enough for my rent one month if you see what I mean. I am rather tempted to put a chunk of it onto the card but again, I worry about being short on rent.

I am very fortunate in that my parents pay my insurance (it's on their multi car policy anyway, I paid for my share when I was working full time but they've kindly let me off now) and when anything does need doing they help me out with it. I don't need it at university as such - I barely ever use it, the £40 is pretty much how much it costs me to fill up a tank and that is an over estimate as I don't ever use a full tank of fuel a month! I have it with me as it is faaaaaar more expensive to get the train home than it is to drive home and there isn't really room on my parent's driveway for it, it's a pain in the bum to have it at home for them. Tax comes out of direct debit and is included in the SoA of about £12 a month. Selling it really isn't an option as my parents home is in the middle of nowhere, I am one of those people who passed their test almost as soon as they turned 17 as the public transport is absolutely shocking and if you want to work you basically have to drive around here. I don't need it to get to work when I'm at uni as I walk but when I'm home I need it and when I graduate I will absolutely need it to drive to whichever job I manage to get.

Clothes I've only put about £15 a month - that's just for essential things really like if tights (which I have to wear to work) get holes in or anything else basic like socks etc need replacing, I don't really ever buy new clothes any more!

I'm hoping I'll be spending less money on socialising etc this term, I have a LOT more deadlines than last term so will definitely be socialising less. I was also getting into a new relationship last term so expensively dating but now we're a bit more settled and both of us have said we're going to try to commit to eating out less, cinema less, etc so fingers crossed entertainment will be cheaper.

OK, fair enough. I would perhaps change it from 'cash' to 'rent stash' or something to avoid confusion. Also - you mention an overdraft: is it interest free? How much do you owe on it?

123rottie

It's an interest free student overdraft yes, I don't owe anything on it at the moment but I imagine with my rent etc by the end of the year I'll owe about £1,000 on it.

lambda

Okdoke. I see a few options for you, but someone else might be able to come along and give you better advice:

1) Reduce your outgoings as much as possible (look at your grocery spending, for example), and try to gather as much each month as you can to make a payment towards the card. Yes, you are going to pay interest on it, but just keep making payments on it as much as you can and it will slowly and surely be paid off. If you could increase the £40 minimum to £100 it will make a big difference in getting the principal down. It won't be paid off overnight obviously, but if you keep chipping away at it, it will reduce.

2) Use your overdraft to pay the most of the card off. Or apply for an increase in your overdraft and use that to pay off the card. Although it is usually much harder to pay off an overdraft than a CC.

lambda

Can you also reduce your mobile phone payment and perhaps go over to something like GiffGaff? More money to be saved there...

123rottie

That's great, it's good to know I'm sort of on the right wavelength with you then!

I think I'll try to go with option 1. As much as I hate owing money on the card and feeling in debt, I'm not missing repayments or anything so it's not really going to be the end of the world if it isn't gone overnight.

I'm going to see about opening a savings account (so the money isn't just sat in my current account!) and work out what I absolutely need to live off each month and everything else that I earn will go in there for me to divide between extra credit card payments and extra money towards rent/emergencies. That way the months that I get more hours at work/more business in my little part time project I can put more into the credit card and the months that I don't I can still just make a normal payment.

I would really love to reduce the mobile phone payment but I got myself in a pickle there. My old phone absolutely went kaput half way through a contract with no insurance, so I went to carphone warehouse and they bought out my old contract so long as I got one of their o2 contracts. I'm only 6 months into that so don't see any way to get out really.

Thank you so much for your advice!

lambda

Yep, there are many ways you can do it. Open a savings account with your current bank and stash cash into there, or open a separate current account that is free for spending to separate spending from bills and debt repayments. The best way is to just budget and be absolutely strict in how you spend your cash. Take a look at something like YNAB. Although you have to pay for it, you get the first month free, which gives you a feel for budgeting, and the cost is totally worth it anyway.

I never look at my bank balance now to see how much money I've got, as a bank balance 'lies' - it doesn't reflect the true value of your money, only a budget does that. I only look at my balance to reconcile my budget.

Anyway, hope this all helps. Good luck with your debt busting and with your uni life!

Sanctioned_Parts_List

Just caught up again. At the moment your living costs without credit card exceed your means. Without getting that under control, the CC debt is irrelevant.

Can you do a balance transfer with the Bank of Mum and Dad? Obviously pay them back - it's character forming - but offset a while and at a rate you can afford.

Your water bill is double what it should be, unless you're all are 3-shower-a-day sorts. Your mobile bill looks high. If your petrol is an overestimate, that's not really how SoAs work - take an average over the last few months. For food - are you partnering with any of your housemates or just buying alone? At uni (in the mists of time) my housemates and I were able to live on about £2/day at today's prices by sharing groceries and meals (3 people, £40pw). We were a bit gaunt, mind.

123rottie

I don't really want to ask my parents to borrow money, they have their own financial stresses by trying to get the house dolled up to get it on the market, are self employed etc so if I can do this on my own I'd rather do it that way. They already help me more than I feel they should at my age.

The water bill again is difficult to put a per month cost because we paid about £90 each in September and that was a quarterly payment. The others aren't nearly as frugal with things like water/heating/etc as I would be if I was living alone which is quite frustrating.

I can't really share food with them either, two of them are veggies, one is always on some daft diet or other and the other is never really in the house. I think I can cut quite a lot back on food this term, I'm quite committed to getting that down.

Again I don't think there's anything I can do about the phone bill, it's very frustrating but it was either that or continue to pay for a phone that no longer worked at all and I couldn't afford two contracts at the same time really.

Petrol is hard to take an average for because the months I don't go home I probably spend about £10 on fuel, if that! But if I visit home then it's a long old drive and it's more like £40 so it just depends on the month, frustratingly, like everything else in my SoA.

Sanctioned_Parts_List

Understood, but do talk to them about it anyway. Even if they can't/you don't want them to help you financially, just talking about it will relieve some of your stress. And maybe fill your larder with non-perishable but satisfying food - always appreciated.

Trust me on this, you'll thank me later.