Making positive steps each day...

Changingpriorities

I have been reading this forum for a good few weeks now and getting some great tips from all of your stories in order to get my finances/debts/bills in order so thank you all for that!

A quick summary of my story:

I have always earned more than average for my age due to my industry and I think this has just got me very used to having spare money and therefore taken on responsibilities that are beyond my reach.. I cannot make excuses for my spending but this was I think it boils down to:( I now live with my boyfriend in a place that he was renting before we got together and unfortunately due to my outgoings I'm unable to afford to give him half of all rent and bills. He is okay with this and is happy for my to only pay him what I can afford for the time being until my debts are paid off. This is one of the priorities as I would like to clear everything and be able to give him exactly half of everything.. Another priority of ours is that once I have finished my part-time degree (my work are sponsoring me for this thankfully) in 3 years time we want to be in the position of having savings enough to get a mortgage and hopefully start our family:j I have previously just stuck my head in the sand and thought 'oh I can afford it' but it has now come to a crucial point where I need to make some decisions on how best to tackle my mountain of debt!

Apologies for the long post.. if you have gotten this far, thank you!:) My outstanding balances are as follows:

Vanquis credit card £144.14 (Credit limit £150) Repayments = Minimum payments per month (approx. £5-£15)
Littlewoods £685.90 (Credit limit £850) Repayments = Minimum payments per month - 15% of balance
Very £1960.18 (Credit limit £1900) Repayments = Minimum payments per month - 7% of balance
Halifax MasterCard approximately £1200 (Credit limit £1500) Repayments = £45 approx. p/m
Halifax Loan £5177.92 (This is a combination of two small loans from Halifax) Repayments = £346.70 p/m
Pounds2Pocket loan £2206 Repayments = £220.60 p/m
Surgery Finance £4990.40 Repayments = £311.90 p/m
Numberplate Finance £581.45 Repayments = £20.05 p/m
Halifax Overdraft £1900 (O/D limit £2300 Repayments = Currently aiming for £200 p/m

Current debt: £18,845.99

That makes me feel sick if I'm honest! But I have made a huge spreadsheet with all my repayments and outstanding balances and fortunately it looks like I could be almost debt free by Christmas next year (20 months away) so that's now my goal. After some more calculations by the time I finish my degree in June 2019, I could personally have approximately £10-15k saved which is a very exciting prospect and a lot of motivation for sticking to my debt-free challenge now!

I have made one huge step I believe towards helping myself out here as last Friday I was accepted for 0% interest balance transfer card from Barclaycard for a total of £3700. With this, I worked out the best way of paying off my high interest credit cards/loans and have put the following transactions into progress:

£1198.94 towards my Halifax Mastercard completely paying that off.
£1135 towards Pounds2Pocket paying an early repayment (saving £851 in interest:eek:!!!!!)
£1212.13 towards Very (paying off the 'Buy Now Pay Later' purchases due to run out soon saving myself approxing £400 interest:T)

I am not 100% sure what my minimum payment for this Barclaycard will be yet until my statement is generated but currently the monthly payments for the above bills are around £345 so I think anything will be an improvement on this enabling me to use the spare cash to pay other debts off.

Well, thank you for reading this far if you have, I must have got slightly carried away! but I just wanted to get involved with this forum as I think it's a great place for us to all support eachother in our goal of being debt free! :beer:

Any advice or obvious improvements you can see from what I have written please do share!:)

andyfromotley

Hi and welcome,

great work. just a couple of points. Post an SOA and we will be able to fully help you.

the 0% credit cards are great BUT do not confuse moveing your debt with repaying it. They are different things. Do not run up credit on the accounts that you have cleared. CLOSE them - today!!

You sound motivated which is common at the outsetbut be mindful it can be a long slog at times and a motivation can fall. Get yourself into the long haul mindset. Your spreadsheets will help with this.

Finally quickly build up a small emergency fund of £500 or £1000 pounds. This will stop a financial emergency becoming a DEBT EMERGENCY! There are people who say dont bother, repay you debts and if an emergency occurs use you CC. I disagree, you are heading to get off the credit treadmill. Having my EF gives me enormous security. It seems to almost magically stop emergencies from happening and when they do i try everything to solve it another way as i HATE spending even one penny out of my EF!!

Good luck you are on the right tracks. Stick around. Oh i find the dave ramsey podcast great for inspiration.

Changingpriorities

Hi Andy thanks for replying so promptly!

I have been seeing a lot of people mention this emergency fund and been wondering whether I should actually move the funds for that into my savings account or just leave it in my current account (the account with the overdraft) but be sure to account for it and know it is there? What's the best do you think?

I do feel very motivated yes, It was a major shock to the system a few weeks ago so I feel very inspired to stick to it. It also helps that I have a weird obsession with being organised/maths/working things out so by doing on a daily basis I find it actually quite exciting and a challenge to myself how well I can do.

Also worth noting I have been putting stuff on Ebay over the last few weeks and have made about £700+ from that which has gone straight to bills

I will head over to make a SOA now, thank you again!

Changingpriorities

I have added my SOA below:

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 2088.5
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2088.5

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 300
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 29.25
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 120
Clothing................................ 0
Petrol/diesel........................... 200
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 87.7
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 46.75
Holiday................................. 0
Emergency fund.......................... 0
Account Fees (+ overdraft costs)........ 45
Ebay Fees (this months)................. 56.73
Total monthly expenses.................. 885.43


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Clarity Loan 1.................4097.52...292.6.....0
MYA Finance....................4990.4....311.9.....0
Number Plate Finance...........581.45....20.05.....0
Clarity Loan 2.................1080.4....54.02.....0
Overdraft......................1900......200.......0
Barclaycard....................3700......120.......0
Very...........................815.46....57.08.....0
Littlewoods....................830.9.....124.6.....0

Total monthly income: £

2,088.5

Expenses (incl. HP & secured debts): £

885.43

Available for debt repayments: £

1,203.07

Unsecured debt repayments: £

1,180.25

Surplus (shortfall if negative) £

22.82

anna_1977

Hi, what happened to the Vanquis card balance? you didn't mention including it in the BC?
Are all your debts really on 0%? when do the 0% end

When do the Very & Littlewoods come off Buy Now Pay Later? The APR will be huge so get these paid off ASAP

Changingpriorities

hi anna, I have used the Barclaycard to pay the Vanquis apologies I forgot to say that also. Theres 0% so thought that would be best. I don't actually know the APR's so did not include them, I will be collecting that information today.

All Buy Now Pay Later purchases have been paid for for Very and Littlewoods. the remaining is just normal credit purchases.

anna_1977

Well done on paying the Vanquis, I know their rate is bonkers
Is there anyway you could get down the mobile cost or parking ?

Changingpriorities

The mobile cost includes a large discount already but does end in August this year, so once this is up i will be swapping to a sim-only that I have already been quoted £15 for

The parking is for a garage on our street. We live in quite a rough area but my boyfriend has a very expensive classic car which we store there.. I agreed to pay for this a few months ago and as I can only afford to pay him £300 towards rent and bills I have agreed to keep this payment. He did offer to take it over when I spoke to him about my debts but would like to keep it myself as he pays for a lot more anyway.

anna_1977

I understand the car thing - I guess the main thing is chucking every single little penny off the debts. Starting with the highest APR once you know that, even if only £5 - every amount obviously saves interest

anna_1977

sorry, just realised you've put OD charges in your main SOA expenses but also in debts, one at £45 per mth and one at £200 - is this correct. Are you really paying £200 per month off your OD?

Changingpriorities

Could I ask you Anna what you suggest regarding any left over each month? I am aiming to put £200 towards getting out my overdraft each month, but say one month I have an extra £80 left over.. should I just leave that paying off my overdraft.. pay it towards another bill (a high APR one).. or put it in my savings account for 'emergency fund'?