Time too clear this mess!

Callumhughes182

Hi, I'm Callum.

Over the years, due to medical reasons causing me too be out of work and being young and reckless, I have accrued what I'd like to consider a large amount of debt!

In total, my debt totals up too £5978.26 which is spread across 5 different credit accounts:
HSBC - £2291.06
Tesco Bank - £2188.96
Halifax Overdraft - £1000
Ao.com (new washing machine) - £272
Argos Card - £226.25

When these debts started getting larger, I was in employment, which too be honest, didn't give enough income too sustain a credit card!

I now have a decent payed job and can finally see the light at the end of the tunnel!

So what are my plans?

I have finally got round too using a spreadsheet that I found on this site to monitor my debts and set myself monthly targets.

Firstly, I want to pay off my £1000 overdraft as its charging my £31 per month for the pleasure of being in it all the time. I have already saved £700 towards so I am currently 2 weeks away from clearing that!

Second goal is my Argos card. A very small yet stupid debt too still have! I have paid the minimum on that account for the last 18 months and the balance is only £225 so I will clear that once the overdraft has gone. I want this too be clear in March.

The third goal is the AO account. The balance on that isn't technically debt as it was a buy now pay in 6 months offer. I have split that with my partner but I want to have the money in my account ready to pay that off in April.

The fourth goal is too clear my HSBC credit card. Even though this credit card is interest free, my minimum payment each month is higher than the one on the Tesco card, even though the balances are essentially the same. I hope this goal to be complete by the latest August!

The fifth and final target is my Tesco credit card. I will start paying this off at the start of August and hope too have it clear by the end of September.

I am weekly paid and I'll be sacrificing £150 a week to pay everything off. I'll also be putting aside an addition £50 into a saving account, so if i don't need that money, that will also be used to pay something off. Also any overtime at work that I get will be used to pay it off.

For every extra £150 I put onto my card, it takes 1 week off the date of completion!

I know it's very difficult to give advice on paying off debt as it's quite self explanatory but the reason for this post is too not only discuss with other members of the forums in a similar situation, its too cement my goals so I can see what I want too do, rather than just throw money onto cards and not actually have a goal in mind.

I hope too talk too you all soon and thanks for reading

sourcrates

Well done.

I wish you success with your goals !!!

Callumhughes182

Thanks, it sounds so easy on paper, but theres a long road ahead

fifteenkeats

I found that using Stepchange (debt charity) to handle my DMP (debt management plan) was more helpful than I could possibly express! Interest was frozen across all debts and they handle everything. Definitely worth looking into.

enthusiasticsaver

Going on to a dmp if you are able to manage payments is not a good idea. From the sound of it the OP still has good credit ratings and is able to make a plan to repay. Freezing interest by creditors and doing a DMP is only done if payments are defaulted and OP unable to make minimum payments.

OP - you are correct I think in your order of paying off debts. Overdrafts are often one of the most expensive ways of borrowing so focusing on that first not only saves you £370 over the year in overdraft charges but also lets you focus on budgeting and spending within your income if you no longer use the overdraft once repaid. Building up a savings account at the same time is also sensible.

Hopefully then this year will see the end of your debt and you will be debt free.

enjoyyourshoes

6th target- reconcile bank account daily and accrue for all costs so you know exactly where you are financially every day

7th target- start considering a savings plan once debts resolved, look at regular savings &/or S&S ISA

user1168934

enjoyyourshoes wrote: »

6th target- reconcile bank account daily and accrue for all costs so you know exactly where you are financially every day

7th target- start considering a savings plan once debts resolved, look at regular savings &/or S&S ISA

Well done OP. This (above) is good advice, add it to your list.

danni.yelly

Sounds great! I think I need to do the same for myself!
Writing down a plan really makes you stick to it.

GOOD LUCK!

Callumhughes182

So, week 1 is complete!

Yesterday, I paid off £300 of my overdraft with Halifax, and even rang them too reduce it from £1000 too £700.

So now I only owe £5678.26

Slowly chipping away at it!

Kodagirl

That's great news, well done, maybe make milestones, and everytime you reach them, get yourself a well rewarded wee treat.
Keep up the good work, luv. ��

enthusiasticsaver

Excellent news. Keep it up. You will be paying it off in no time at that rate. Reducing the overdraft limit as you pay it off is a good idea.