Small Steps Out Of Massive Debt!

GeorgianaCavendish

enthusiasticsaver said:

Great to see that Tesco gone. Are you redirecting the £150 to MBNA now? The 0% deals are not going to be as frequent I don't think. If you pay £250 a month that will make it £4700 by April when the deal finishes. Hopefully there may be a few 0% offers after Christmas. 

I'm really glad to have Tesco gone! I am redirecting the Tesco direct debit plus the debt-repayment share of the "spare money split" to MBNA so I'll be paying £900 a month from end of November. If I stick to that plan it leaves the balance at £1200 in April when the 0% ends. I'm due to meet the LISA threshold for the current tax year in February 2021 so my current thinking is to channel all that money towards MBNA in March, that would bring the balance down even further. 

I'm trying to fund the LISA a couple of months before the tax year deadline because I'm a bit paranoid about how long it takes the bonus to be claimed and then applied to my account (3 weeks) and I'd rather it was done well in advance of the cut off date, so I can relax. This is probably a nonsensical fear, but it will make me feel better 


 badmemory said:

I too think 0% will be harder to come by in the future.  Banks have to make their money somehow & if their normal sources have dried up then they will have to look elsewhere.  I am just hoping that they don't go the possible HSBC route & start charging for an ordinary current account.  If they do then the worries about %ages on cards are going to be a very minor worry.  I remember what they used to charge back in the day when most of your bills were paid in cash. 

I really hope they don't start charging for normal bank accounts but I could see that coming down the line if we do into negative interest rates. I've been so reliant on 0% offers to speed up my debt repayment but it looks like my strategy will need to adapt. 

GeorgianaCavendish

Spent a bit of time today reconciling my transactions with YNAB and updating my Monzo pots. I had a fair amount to update as I got the majority of Christmas shopping done over the weekend, I've got about 1/3rd left to do but I'm going to hang on for the end of the month in case of Black Friday deals. It feels like such a novelty to have the money for purchases ready and waiting in a Monzo pot, instead of the usual guilty feelings that come with spending. I've been using cashback sites and discount codes where I can, so still committed to getting a bonus where I can! 

Despite the news about the vaccine, we've had confirmation that return to the office will be "March 2021 at the earliest" and privately my boss has said he thinks it will take longer than that. Selfishly, this is good news for me because keeping my finances the same for five months would see the LISA funded for this tax year; 70% of the remaining debt gone and the remaining 30%  on track to be repaid within the 0% period. There just isn't enough information about how the timelines for getting a vaccine would work, or the logistics of bringing everyone back to the office, so I'm not going to adjust plans yet. 

DayDreamerandGeneralWaster

I wonder if they are drying up because of the persistent debt regs. It stops people moving the debt around without paying it off. I did that for years before l tackled it.

GeorgianaCavendish

DayDreamerandGeneralWaster said:

I wonder if they are drying up because of the persistent debt regs. It stops people moving the debt around without paying it off. I did that for years before l tackled it.

That's a good point too and I transferred from HSBC earlier this year so it could well be a factor. 

GeorgianaCavendish

Another cash out from PA done and transferred to the haircuts pot. I tend to cash out as soon as I reach the £5 threshold on PA, and redeem vouchers when I get to £10 worth on I-SAY - I don't like building up balances too much on survey sites in case they close my account (that happened with another site in my early MSE days).

43% of the money saved in the haircuts pot so far has been from surveys and cashback. I'm happy that I made the switch towards putting that money towards something fun/treaty - it feels more incentivising than paying it off a card. I was getting a bit demotivated with the surveys before I changed tack so I might mix it up again if I feel motivation flagging.

Naomim

GeorgianaCavendish said:

Another cash out from PA done and transferred to the haircuts pot. I tend to cash out as soon as I reach the £5 threshold on PA, and redeem vouchers when I get to £10 worth on I-SAY - I don't like building up balances too much on survey sites in case they close my account (that happened with another site in my early MSE days).

43% of the money saved in the haircuts pot so far has been from surveys and cashback. I'm happy that I made the switch towards putting that money towards something fun/treaty - it feels more incentivising than paying it off a card. I was getting a bit demotivated with the surveys before I changed tack so I might mix it up again if I feel motivation flagging.

I think it also makes it feel like a treat.  Although my prolific money is going on card overpayments at the moment but once they are greatly reduced then I might think about changing it up.

DayDreamerandGeneralWaster said:

I wonder if they are drying up because of the persistent debt regs. It stops people moving the debt around without paying it off. I did that for years before l tackled it.

This is me.  I've moved my debt around for years until this past year. Luckily I have once again managed to get it all on 0% and actively paying it down more.  I have just had a couple of 0% offers come through but one had a really high fee attached. Luckily I'm not in need of any until next August so fingers crossed they may still be offering.

Naomim

GeorgianaCavendish

December Debt & Savings Totals 
The month I became debt neutral!     
I didn't quite make it last month, but as of 1st Dec I will have more in savings than I owe on credit cards, quite a surreal feeling for me! 

Savings :
3 Month Emergency Fund :100% funded  (2.22% of the way to the next EF goal )
Moving Fund : 100% funded 
LISA : 58% funded (for this tax year)

Debt : £7,800.00

TESCO - £0.00
Now you're just some money that I used to owe! 

MBNA - £5,000.00
0% until April 2021 
(set payment of £100 per month, to be revised again at end of November) 

Virgin - £2800.00
0% until March 2022 
(set payment of £50 per month - moved DD to better align with my pay cycle, so effectively didn't have a payment this month - I put £25 on it this month and put the other £25 toward clearing the Tesco balance) 

GeorgianaCavendish

This month I have been a lot calmer about money. I've found that using YNAB and setting up corresponding pots in Monzo has really helped me to feel more relaxed, I had to constantly tweak pots throughout the month as my priorities changed but it was very useful to do. 

I tweaked my goals for LISA and paying off MBNA, I put a little bit more towards the LISA this month because I'm trying to get it funded as early as possible. I'm still on track for meeting both goals by April 2021. 

Because this worked so well last time, here are a few things on my list of financial stuff I did that was good, bad and neutral :  
1) YNAB and Monzo pots - even though I had to keep tweaking the pots throughout the month as my priorities changed, this has been a very useful exercise and helped to calm down some of the Financial FOMO demons 
2) spent too much time on some diaries / put a ban on reading some diaries - I got sucked in to a couple of diaries that ended up fuelling my stress levels and had to put myself on a ban. I might try again when I'm feeling more resilient! 
3) implemented the 'worry about it once a week' strategy for financial admin. @enthusiasticsaver recommended this last month, and it has been really helpful for me. I've been reconciling YNAB / Monzo/ main account once a week, and scanning financial letters etc. If anything financial crosses my mind outside of this time, I write it on a list and park it to action in my next admin session. 
4) panic-bought skincare products before I needed to ... and then found another nearly-full bottle of the one that I thought was running out. Now I have a surplus of this particular product. 
5) Finished Christmas shopping. Usually this carries into December and takes a chunk of my Dec pay. I'm finished with it now and that means I don't have the additional stress of making the Dec salary cover extra expenses. 

Apart from this, I'm trying to keep flexible about moving, returning to the office etc - everything is still so uncertain! At the moment, I'm planning for our lives to "get back to normal" in April next year but it is looking more likely that it will be later in the year. I'm trying not to plan too much for having the same level of disposable income that can go towards savings / debt payments, but I think after April our priorities will be saving as much as possible for a deposit, and probably starting to save into the holiday fund - we'll see! 

astrocytic_kitten

You’re doing brilliantly - debt neutral is fantastic! You’re sounding much happier and less stressed with things too ☺️

enthusiasticsaver

I am glad that you are calmer about  money now and having a financial admin slot where you think about it then put it away in its box is working for you.  You are now used to living within a budget so you do not need to constantly be thinking about debt and you have the money pots so sounds like you are sorted now.  Your mental health is important so if reading diaries or some diaries is fuelling stress then step away.