I'm Back - and better! Final Push to Go...

Exerbusi2

It's the start of a new year, so as per every year I take a look at my finances!

When I first joined this forum, I was in £8000 of debt with no savings and no others assets. Not any more.

My current situation is....


Debts

Credit Card: £5,500

Assets

Savings: £3,500
Stocks and Shares Portfolio: £4,600

I've been there and back when it comes to debt. At one point I was in £8,000 of debt with an income of £15,000.

Not good.

I grew a business, started to take more care of my finances and with the help of this forum, I chipped away at it.

You can do it too. Just stay disciplined.

My Current Situation

So my current situation is simple. I have cash in the bank, I have a small share portfolio and I have a much larger income than I used to have (I also have larger outgoings though!)

The obvious thing to do is to use my cash to pay my credit card. There are two reasons why I won't do this though...

1. My cash is my buffer. It's also there to help with business expenses.
2. My credit card is 0% for 32 months, so it costs me no more than it should.

My Plan

The reason I have a £5,500 credit card balance is because I took out the 0% credit card to pay off my car loan. The loan was £5,700, but I saved £230 by closing it early.

My plan is to pay off the card within 22 months. To do this, I'll have to pay £250 per month (more than the £183 I was paying off my loan), but I will be doing this by cutting other expenses I don't need.

I'm having a shed built at home (necessary, not indulgent) and I plan to (in time), make gifts to sell from there (I'm a woodwork fan!)

If I can make this side business pay for itself, I shall be channelling all of that money into debt repayment.

I also have a website that I earn a little money from. All of my website earnings will go towards credit card repayment.

I'm going to take a good look at the finances this year. I have the means to get rid of this credit card, I just have to do things sensibly.

I'm looking forward to seeing this debt disappear!

Steve

Exerbusi2

So my loan is paid off and the account is closed. I'm now about to attack the credit card...

Exerbusi2

So I've made a decision to cancel my iPad subscription. It's only £25 per month, but that's £300 per year, or a whole extra month's worth of credit card repayment.

Beyond that, I'm going to re-instate my old NSD's I used when paying off the debt in the first place. The logic being if I could put £5 per day towards my credit card, that's an extra £1,825 per year!

LauraB89

Looks like you are making great progress!

A good way of looking at everything - working out the annual equivalent, definitely need to try that more often

xxx

Exerbusi2

LauraB89 wrote: »

Looks like you are making great progress!

A good way of looking at everything - working out the annual equivalent, definitely need to try that more often

Thanks Laura!

It's how I break down a lot of my spending - when you look at a one-off fee, it seems like such a small amount of money. Added up over the long term, it's a sizeable chunk.

This year I've unsubscribed from a marketing group I used to be a part of, I've reduced my Virgin TV subscription to around £45 per month and I've gotten rid of my iPad fee. Collectively that's around £150 per month saved, or £1800 per year!

I also made my first £100 payment off the credit card this morning, so I'm now eating into that debt!

Exerbusi2

So I've paid another £75 off the credit card today.

I've got £135 to pick up this weekend, so half of that will go on the credit card.

My aim is to get the credit card debt below £5k by the end of Feb - as of today it's £5,417.

Little steps...

MrsTinks

What kind of wood working things are you planning on making? Sorry I'm frightfully nosy!

And well done on working towards your totally debt free date

I don't have the savings or stock, but I have invested in some very particular things which can be cashed in if need be and like you my debts are 0%. So I'm working towards paying off my stoozing too

Exerbusi2

MrsTinks wrote: »

What kind of wood working things are you planning on making? Sorry I'm frightfully nosy!

Ooh I don't see it as nosy at all!

So I'm going to be making things such as coasters, chopping boards, serving platters, pen holders, shelves etc - basic things really. The idea is to make merchandise that looks great, doesn't cost much and can be made quickly.

It will very much be a side-venture, but if it takes off, who knows?!

UPDATE: So today I have paid off another £50 from my credit card, making my payment £225 for the month so far.

I used this strategy to chip away at my much larger debt the first time - making small, regular payments added up over the long term.

I earn a few pounds every now and then for writing about health and fitness, so any payment I get from there, I plan to pay straight off the debt. I'm awaiting £80 in payment, so all of that will go straight off the credit card.

If I can get the card debt to below £5000 by my birthday (mid March), I'll be a very happy bunny!

Exerbusi2

That's a great idea skcollobcat! One of the reasons I think woodworking is a way to make money it's it's relatively cheap and easy, plus there's a great mark up on the products!

On_my_way

You can do it

Exerbusi2

So a further update...

We put our family holiday on the credit card (but have the money to pay for it, so it's not too much of an issue).

I will be paying my share of it today and my better half is giving me her share of the money over the next 2-3 months.

That'll see me below £5k in 2 months.

I've also just sold £630 worth of shares, so I'm going to use that to fund the holiday, meaning I'll be keeping up my 'normal' rate of debt repayment.