My Debt Free Diary

Retrievermomma31

Hi everyone

Going to give a debt free diary a whirl!

Background:
- Mortgage £65k remaining
- Family loans £16.8k - £11k for house deposit, £4.5k for home improvements, £1.5k due to payroll messing up!
- Car finance £5.5k - Needed new car but could have got a cheaper one in hindsight
- Credit cards £1.5k - Used to buy things for the house
- Computer finance £750 - Bought for partner's uni work (ICT based)
- Phone finance £480 - Bought when my previous phone decided to stop working

Total: £25.8k (excl. mortgage)

Aim to be debt-free: September 2019

So as you can see there's a lot here :mad:
But my partner and I are determined to get this gone in 3 years.
My main problem is thinking I have an unlimited amount of money each pay day - I'm great at creating budgets and plans but when it comes to actually putting in place I just don't stick to it.

But now I have decided to stick to it because I can't keep going on living paycheck to paycheck, and it will get to the point where I drown in my debts!

I have created a weekly budget for myself, which I'm going to draw out in cash. That way it's all there in front of me, no waiting for pending transactions on my banking app.
If I don't spend all the cash that week I'm going to stick it in a piggy bank.
I'm hoping that at the end of the month there will be a fair sum that can be plonked onto a credit card or loan!

Luckily I'm not interested in going out every weekend throwing money away on alcohol - I'm happy enough sitting in and watching netflix with my boyfriend and dog at nights, and walking the dog or visiting family in the day.

I am also due to start a new job soon, which will offer bonuses every few months. This is going to be a great way to tackle my debts and possibly even get them paid off in less than the 3 years I've planned for.

I have decided to get rid of my credit cards (bar one for absolute emergencies) and I am paying extra on these to gradually get rid of them.

I am paying off my family debts and credit cards first, and then as I stop paying one I will add that money up to put on the next debt, which is cutting my pay-off time in half!

I keep reminding myself that this is all going to be worth it in a couple of years when we have no debt except a mortgage and can actually start saving properly!



:beer:

thriftylass

Good luck on your journey. Drawing out in cash what you have available each week is handy as it visualises the money rather than just handing plastic over. Good idea.

Maybe post a SOA here so that you made your budget "public" as an incentive to stick to it better and people could give you advice on where to tweak it.

Thirdly, have you addressed where the debt came from? Are you still using the credit cards, family to borrow money etc. Was it sth you had to do (like home improvements) or just frivolous/thoughtless spending?

Do you have a plan what to pay off first (which has the highest interest rate etc).

I'll be interested how you get on. And good luck in your new job.

Retrievermomma31

thriftylass wrote: »

Good luck on your journey. Drawing out in cash what you have available each week is handy as it visualises the money rather than just handing plastic over. Good idea.

Maybe post a SOA here so that you made your budget "public" as an incentive to stick to it better and people could give you advice on where to tweak it.

Thirdly, have you addressed where the debt came from? Are you still using the credit cards, family to borrow money etc. Was it sth you had to do (like home improvements) or just frivolous/thoughtless spending?

Do you have a plan what to pay off first (which has the highest interest rate etc).

I'll be interested how you get on. And good luck in your new job.

Thank you thriftylass!
All good ideas, I will get started on these now!

Retrievermomma31

SOA as of October

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1284
Partners monthly income after tax....... 1100
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2384

Monthly Expense Details
Mortgage................................ 360
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 130
Electricity............................. 43
Gas..................................... 43
Oil..................................... 0
Water rates............................. 18
Telephone (land line)................... 0
Mobile phone............................ 80
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 20
Groceries etc. ......................... 300
Clothing................................ 0
Petrol/diesel........................... 80
Road tax................................ 0
Car Insurance........................... 50
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 20
Buildings insurance..................... 6
Contents insurance...................... 6
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1156


Assets
Cash.................................... 0
House value (Gross)..................... 80000
Shares and bonds........................ 0
Car(s).................................. 6000
Other assets............................ 2000
Total Assets............................ 88000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 65000....(360)......0
Total secured & HP debts...... 65000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Family.........................11200.....200.......0
Sainsbury's....................4500......100.......7
Car............................4860......140.......0
J credit card..................250.......5.........0
J Credit Card..................850.......20........0
Phone..........................480.......30........0
Credit card....................200.......6.58......0
Credit card....................550.......25........0
Credit Card....................650.......25........0
Mum............................1360......100.......0

enthusiasticsaver

Great you have started to budget and I like your idea of drawing money in cash. I would suggest saving a small amount into an emergency fund so you are not tempted to use credit cards if you have an emergency repair on your house or car.