Student sorting it out early...

adamjm96

Hi everyone! This is my first post here, so if I am doing anything wrong please let me know. I'm hoping this diary will give me some form of motivation to keep things up and get my situation sorted before it gets worse.

So, I'm a student at University, in my second year and my financial situation has gone gone hill drastically lately.

Just a bit of background firstly, last year I had a lot of financial help with it being my first year, plus a paid internship, and a job, I had several thousands more in my pocket. Whereas this year, I have had to do an unpaid internship, plus I was transferred to a zero hours contract with work and haven't been able to find any other employment. I have been living this past year in the financial sense of last year.

Unfortunately this means I've wracked up about....
- £1,500 of credit card debt
- plus I'm about £1200 into my overdraft.
- & I've had to dip into my savings and I want to replace that money in my bid to recover things before it gets any worse!
So approx £3000 in debt (& another £2,000 to replace my savings) :eek:

So, I've had a mooch round these forums and I've signed up for YNAB, and set it all up. I've worked out that I've been drastically overspending BUT I have a budget and if I stick to that I will be able to start getting things back on track.

Does anyone have any ideas of things I can do in the meantime?

adamjm96

Okay, so had a few days going with my new budget and so far everything is going pretty well. I've got a big food delivery coming on Sunday and I planned out my entire meals for a month (took AGES) but this means that I have been so much more efficient with my spending but also I will cut out those killer unnecessary trips to the supermarket.

On top of this, I went out last Friday and cut back on my drinking and only spent £4.00 instead of the usual £30-£40. This extra money has gone straight into repaying.

YNAB is a lifesaver. I strongly recommend everyone to use it. This forum has also made me feel so much better about my finances - and in a way, I am kind of glad that this has happened to me now. Because I am 20 years old and I will now have a sound knowledge of budgeting and how to sensibly spend money. Much rather get on top of it all now, rather than 5 years in the future where I have the ability to rack up a lot more.

Fletchasketch

Hi Adam,

I remember being a student drowning in debt very well- it wasn't fun!

I think by the end of my second year I had debts very similar to yours and used the summer holidays to pay them off. By working at AQA, and living at home during the summer holidays added to a 2/3 nights a week bar job, I managed to pay off £300 a week, leaving me at zero when I went back at the end of term.

I also finished uni with the full 0% overdraft, but as they gave us 3 years to pay it back, this was manageable at the time.

I'm not saying don't cut back, but if I had my time again I'd worry a little less about money and more about my studies & enjoying uni.

Wishing you the best of luck.

milasavesmoney

You are gaining a crucial financial foundation by tackling your debt. What you learn now will set you up to be a successful individual, regarding finances, for the future. One of the most crucial lessons to learn is to not spend more that we have.

You have made an excellent start! I'm looking forward to your posts. Subscribed.

adamjm96

Thanks for both of your replies. Yeah, it does sometimes feel a bit like I'm drowning in debt, especially with money coming into the bank so far apart. However, I do feel taking charge now will be so beneficial for the future, it's just a case of getting the right balance, I guess!

I'm so glad they give you that amount of time to pay back the overdraft, though. Hopefully I can get some work this Summer and get it paid off slowly anyway before September to try and get a bit of a head start.

I've had a good few days anyway, went out last night and spent £12 which is again quite a good amount considering some nights can be MUCH higher. Although I won't be going out anymore much as all my flatmates are moving home for the Summer and I'm stuck here doing an unpaid internship. However, I'm hoping to get some sort of grant from my Uni to cover the costs, fingers crossed!

adamjm96

The past few days have been quite sobering. I've realised the extent of the cut backs I'm going to have to make over the next few months, however I am determined to not fail because in the end it really will be all worth it!

Goals for this week:
- Eat healthy each day.
- Go for exercise as much as possible.
- Have Tues/Wed/Thu as NSD.
- Only drink alcohol on Friday.

milasavesmoney

How are things coming on the job front?

adamjm96

Quick life update!

The past few weeks have been crazy. On the spending front I have been incredibly good, had many NSD's and cut down majorly on stupid, pointless spending.

Unfortunately I've been doing an unpaid internship so my financial position is a lot worse than when I started... However I will be getting my travel expenses however it still means I've had six weeks of funding myself from nothing really. However I'm taking it as a good learning experience - my cut down of spending is a positive step forward and once this is over I'll be really able to get back on track (also having an internship will hopefully boost job prospects for next year which hopefully means a bigger salary!)

The next couple of months will be tough however my plan of action is:

- Stick to spending minimum. No impulse buys, everything is planned.
- Cooking is done on a Sunday will a full meal plan for the week (saves going to ASDA and buying all sorts I do not need)
- Friday is treat day and I usually take advantage of the 3 for £5 deal on alcohol.
- Once completed this job then move back home (in 2 weeks!) and get a job for about six weeks to try and build up some funds to pay off the credit card.
- Stick to eating healthy and exercising - really does help keep my mind clear.

One thing I have struggled with is the deferred gratification of being debt free. Sometimes it feels like it's going to take forever & that I am making no progress. But I guess this just has to be plowed through one day at a time.

Onwards & upwards!

reality_check

Hey Adam!!

Just had a read at your diary, and it is so good that you're getting your finances in control sooner rather than later.

Making an effort to minimise the little spends will help loads as they all add up. You won't feel like you're missing out if you take a travel cup of coffee as oppose to a £3 Starbucks, taking a bit of fruit as a snack rather than a £2,00 tiny fruit pot you can buy and bringing a sandwich from home as oppose to a £5 meal day at lunch...this was the old me, easily could spend £10 a day on 'essentials' but in reality you can have the exact same and if not nicer from home for £10 a week or less. I don't know if you do any of the above but incase you do just offering my alternatives.

The unpaid internship will put you ahead of the game in the long run...although I'm sure can feel pointless right now and you would rather get a job that pays. Not long until you're back home now, this should save you some money if you're anything like my kids lol Have you got a job lined up?

It is really important not to forget to live, and seems like you have a good balance. Depends what your incomings and outgoings are but a 70/30 split seems to work for me....70 towards debt and 30 for being able to have a life. I tried 100% paying debt only, it didn't work...but that's just me!

Good luck I'm looking forward to reading your updates and seeing how you get on! xx

adamjm96

Hey guys!

Just a quick update.

I have managed to get a part time job to go alongside my studies at Uni which is slowly helping me claw back at my finances.

I've worked out that by Christmas by current account will be at a safe balance and then by next April, my Credit Cards/Phone Bill will be all paid off.

After that I'll be throwing any excess money I have into savings.

It's a long time away till I start getting into the positives but it's exciting to be on the right path.

reality_check

Adam, how are you getting on? x