Prosperous soul in the making

savingholmes

savingholmes wrote: »

It's been a long time since I last posted - however the good news is that
1) We now have an emergency fund of over £1000
2) We gave back a car at a break point in the lease and bought a motorbike for OH instead
3) We now owe £38840
4) We are on target to be debt free by June 21 - and if we up our game may be able to get this to March 21
5) While we are not fully following Ramsey's baby steps - I have worked out when we should hit each point - he suggests that you do baby step 1-3 sequentially and potentially 4-6 together (and pause 4 while you get debt free)

Baby Step 1: Emergency fund of £1K - achieved Feb 19
Baby Step 2: Debt Snowball - on target to achieve Mar-June 21
Baby Step 3: Create a 3-6 month emergency fund - by May 22
Baby Step 4: Invest 15% of income in retirement funds (currently achieving 43% of the 15% target)
Baby Step 5: Save for kids college - currently paying £400 to DS each month - expect to do the same for DD if she wants to go 2021-24
Baby Step 6: Pay off the house - paying £43 pcm plus interest currently - will increase once Step 3 in place (owe £145.6K)
Baby Step 7: Build wealth and give

I would welcome encouragement along the way and will try and post more regularly again. I am thrilled though that even though there's been a gap since I last posted our debt has still been going down.

Due to have car paid off in full CC5 by the end of next month:j
Due to be at £21.4K debt by Christmas.
Due to pay CC4 by Jan 20
Due to pay CC3 by June 20
Due to pay CC2 by Sept 20
Due to pay CC1 by Nov 20 - and complete baby step 2

Step 3 by Mar 21 if 3 months or by Jun 21 if 6
Then can start baby steps 4-6 to sort uni for DD, invest for retirement, pay off mortgage

doingitanyway

Wow paying off your car loan next month will be a huge achievement.

You are doing great. Keep going.

You've inspired me to think about my baby steps too

savingholmes

Thanks SSDD23 and doingitanyway

I am happy if we can get some good out of the situation we've got ourselves into. I am so excited I can't tell you - we will have cleared £9K by the end of this pay period - thanks to the PPI boost! Incredible. I nearly didn't reclaim the ppi - all told it took me 30 minutes and 8 weeks elapsed time to get £6.8K. I'd even claimed on it - and still got paid out under plevin rules - they just deducted what they had previously paid out. Woohoo.

Trying to hide it from kids though so they don't get begging bowls out LOL. I just feel so relieved. I have been so depressed about our debts and its like a huge weight has been lifted off me. I felt like I was drowning before and battling shame for getting in such a mess. The PPI and the DR baby steps have definitely helped me loads.

jwil

Welcome back! Just caught up

I love your plans for being debt free, I've never read Dave Ramsey, must look him up. I hear a lot of people talking about him on here.

Glad you managed to look at the house and realise it's not the right one. Your plans sound lovely though.

That is fantastic news about the PPI, congratulations :T :T You'll have smashed down your debt in just a few weeks :j

savingholmes

Thanks Jwil for visiting and Crystal and others. I am still so thrilled about the ppi. I took a long lunch and put cheque one in the bank today. The second hasn't physically arrived yet - so will probably put it in the bank on Friday if it comes in time. The cheques will take 5 days to clear but I was eager to pay a bit more off my CC while I waited. So paid another £500 off while I am waiting so I can update my signature :rotfl:

I confess I succumbed to eating out at lunch as I'd had a difficult morning and just wanted some peace. It's in my budget though so not too bad. Also paid Road Tax for motorbike this week - it is getting its MOT this weekend.

Still decluttering mostly to bin or charity shop rather than selling but at least its progress. None of the things DD listed sold... Will have a look again at the weekend at what we can sell and where best to do it.

becky170

Wow you're doing fantastically savingholmes. That's great news about your ppi payout

Nichelette

Congrats on your amazing PPI result!

savingholmes

Thanks Becky and Nichelette. I'm trying to motivate myself by seeing the bigger picture. If we can do baby step 2 and 3 (pay debt and get emergency fund) then if DD goes to uni in 2 years time we could seriously considering selling up and moving. If she chooses a degree apprenticeship or similar it could be harder - as we may need to stay closer than we would otherwise for say upto 3 years. But either way - we would be in more control of our money and taking steps towards one day being able to live somewhere greener. From my lounge there are trees and bushes in my eyeline - but too often there are also the neighbours cars and that is frustrating.

I got seriously depressed at one point last year - and so much of it was due to debt - and yet traditionally shopping was my method of cheering myself up. I'm trying to get fixated on clearing debt instead and on decluttering - with the side benefit of finding multiple sets of things that were 'lost' and of making the house feel bigger and lighter. Its demonstrating too me quite how much stuff we have and making me ask even myself why/!!!

Financially staying put long term would make sense - its a gorgeous house - just for us in the wrong setting...

savingholmes

I changed my Direct Debit for my mortgage to overpay £78.51 pcm. In doing so - they sent me a letter telling me how much we had over-paid in the last 11 years = £5391.75. It's something at least. We put about £50K down when we bought this house (but that was only because the last house increased in value). It has gone up about £50K in that time and seems to be rising more rapidly again currently.

I'm really hoping the postman brings me my second ppi cheque before I go to work. This weekend I want to see if there are any other companies that we could potentially have ppi from and fill them in for DH too. The deadline is the 29/8/19 for everyone.

DancingInTheRain

Just catching up after being AWOL for a few days, what fantastic news on the PPI payouts, I’m over the moon for you. What an amazing month you’re having, I’ve been thinking the Dave Ramsey baby steps could be a good method of debt pay down for me and DH too, off too do some research...
Have a great day, hope the postie brings you a lovely cheque x