I Want To Get Out Of Debt!!!

ms_london

You will need to check with Egg. This depends if the loan is "front loaded", which means you pay the interest first, so even if you wanted to pay it off early you will still be paying the same interest. All loan's are different, check with Egg.

James240

Hiya Ms London Thanks for the reply, my actual out goings are as follows:

Wages: £1029 from First job
Wages: £300 approx from second job

Loan: £303

Rent: £250

Car Insurance: £32

Broadband: £25

Mobile Phone: £70ish

Travelcard: £29

Savings: £10 a month

Gym £35

Petrol £20 Only use car at weekends to go to second job

Food £50

Hopefully im going to reduce mobile bill by going on lower tariff at the moment going to phone up and do that today. Cant really see were i can reduce my actual outgoings. Been doing second job for about a year and paid of other credit cards with the money i have had spare. Its just the loan that i now have outstanding. Any ideas at all MS london? really grateful for the reply as i really would like to get this loan dealt with as quickly as poss and then i can be debt free yipppeeee!!! :j If any other money savers have any ideas wouldalso be grateful cheers guys.

donsaini

with regards t car, is it worth keeping if you only use it to go to 2nd job.
say you arn £300 due to this, how much is it costing you. ie petrol,insurance, mot, servicing, parking , etc. now is it possible to catch public transport, or even a taxi if that worksout cheaper. by selling the car you could put that money towards your loan

mobile seems high, look around for one of those good cash back deals

James240

i own the car outright and it only cost me around £20 a month to put petrol in and the insurance is £32 a month so its not costing me too much. My other Job is 8 miles away so need the car and public transport will take too long or be too expensive, plus mum is moving downto brighton soon so will need the car to go and see her. Mobile is high because i use it too much so im gooing to be cutting down on that immediatley.

ms_london

Wages: £1329


Rent: £250
Car Insurance: £32
Broadband: £25
Mobile Phone: £70
Travelcard: £29
Savings: £10
Gym £35
Petrol £20
Food £50

Total Outgoings £521

Debts
Egg Loan £303 (£12,500 @ 7.9%)

Net monthly surplus £505

So basically you are left with £505 at the end of each month. This is HUGE amounts of money (im used to a budget of £200 per month), however, if you were to stop doing your 2nd job, with your current outgoings, you would only have a surplus of £205.00 each month. Again, manageable, except this means that for the next 4 years (until your loan comes to an end) you will only have that £205.00 each month... Or if you kept up your 2nd job you would have £505, but as i mentioned before, do you really want to be doing two jobs for another 4 years??

Please find out what the terms are with your loan, call them today & ask. Ask whether you can repay over the minimum payment each month? If there is an early repayment penalty? And how is the interest calculated? I.e on a day to day basis, or frontloaded. This is important to know.

As someone else just mentioned, could you sell your car. This would a) give you a lump sum to put towards your debt, b) mean you wont have to pay £52.00 a month for petrol/insurance (NB, where do you get the money for your car tax, MOT, this needs to be budgeted for too.....)

Who do you live with? Dont you have to pay council tax/tv licence/water/gas or anything?

Broadband, could this be cheaper at all? Same with mobile, £70.00 is a lot of money. Could you change your tariff or Network? (sometimes switching over to PAYG isnt always the cheapest option)...

£50 for food a month, this sounds ok (assuming its for one person). Does this mean groceries or lunches/meals out? If the latter, you need to cut this & start taking food into work. Otherwise include meals/lunches out in your personal budget (yet to come).

£35 for gym. If this your only, one of your main social events (i.e rather than spending more money going out), then keep it, but only if you use it enough & it isnt wasted.

£10 savings, what is this for. Emergency money or a holiday fund? Or for budgeting for things like the car tax?

If i were you i would set yourself a monthly/weekly budget. If you have £505 as a net monthly surplus, personally I would keep £200 for yourself (assuming you keep the £50 food budget, £35 gym membership) and throw the rest at your loan. Play around on https://www.whatsthecost.co.uk - see how quickly you could pay off your loan assuming you were paying £600 a month, how much interest would you save?? With £200 a month, thats £50.00 a week - perhaps it doesnt sound like much, but the key is cutting costs where you can, taking sandwiches, going to cinema on cheap night, going to the gym a lot and making the most of your membership, not eating/drinking out so much. Effectively you have £200 a month for you, but also the £50 for food and £35 for gym, so total £285.00 - you shouldnt feel deprived.

Let me know what you think. It does depend on how badly you want to be debt free, if i were you i would be on a budget for the next 2 years, and then after that that you owe no more and can spend all of your money on YOU, or keep doing your 2 jobs for the next 4 years (because youll have to) and still have the debt hanging over your head. If you wanted to save for a deposit for etc/buy a house, the debt needs to be paid off asap, the same if you wanted to go travelling, so it depends on what your priorities are, and how you want to see yourself in 2009. (when my loan should have run out, the year id be 29 - didnt want to be 29 & still in debt!!!).

Email me if you want to know anything else, more advice. & good luck.

Ms_London

James240

hiya Ms London

I need car to go to second job so selling it really isnt an option. (although i do see your point of putting it towards the loan).

I live with my Best friend and girlfriend in there house so i have no need to pay council tax, etc.

Road tax, Mot is what i put the ten pound a month away for if i need any more than i take it out of what i would use for me to go out and confine myself to house lol.

Broadband i cant change as locked in too a 12 month contract with BT so bit of a bummer on that, same goes with my mobile phone, although i plan to leave it at home like Martin advises as tat means i wont be making stupid calls or txting for no particular reason.

James240

hiya Ms London

I need car to go to second job so selling it really isnt an option. (although i do see your point of putting it towards the loan).

I live with my Best friend and girlfriend in there house so i have no need to pay council tax, etc.

Road tax, Mot is what i put the ten pound a month away for if i need any more than i take it out of what i would use for me to go out and confine myself to house lol.

Broadband i cant change as locked in too a 12 month contract with BT so bit of a bummer on that, same goes with my mobile phone, although i plan to leave it at home like Martin advises as tat means i wont be making stupid calls or txting for no particular reason.

Also same sentiments as you MS London im 27 and i really dont want to be in debt when i hit my 30's so yes i really do want to getout of debt badly and will do what it takes to get out of it so if aiming to be on a budget for two years is what it takes ill do it. and no i dont want to have two jobs for 4yrs lol!!

Also i will be changing my contract to be as cheap as possible as well reducing from the £30 a month tariff to the £15 a month tariff and then im not going to make so many random calls and txt's. :T

Yes i do think your planning of this sounds good am really grateful am waiting on Egg to get back to me regarding the interest so hopefully they will get back soon and i will let you know.

Really appreciate the indepth respones u have given me Ms London and am really grateful x :T

James

ms_london

Hi James.

Its good to hear that you are taking some of the advice on board - a lot of people dont, but it sounds as though you have had your "lightbulb" moment :0)

Re your broadband & mobile phone - you say you are stuck in a 12 month contract, does this mean that you are unable to downgrade aswell?? Perhaps you could call them both & explain that you are having money difficulties and need to cancel, they might honour this - its worth asking, but otherwise downgrading might just be as economical.

You seem to want this bad enough, well done on doing the two jobs, i know its not easy, but you can get there!! Just keep up the good work, and im happy to help, i really am, i just wish more people who actually ask for advice would actually listen to it.

Keep up the good work James.

Ms_London

James240

Definatley having a lightbulb moment Ms London. Egg have finally got back to me and they said that any overpaymentswould be paid off the amount i owe them then interest would be calculated on the amount left that i owe them, so i guessw that would help if im paying off directly what i owe them instead of being charged interest as well.

As for the Broadband only really got it in the last couple of months so wont be able to change that, going to phone Orange today, and get them to put me on there lowest tariff as i really dont make that many phone calls now that i have split up with girlfriend (aobut 6 months ago!)

and Believe me i really do want this bad enough as it would be so nice to be out of debt and start to be able to afford to buy a place of my own.

thanks so much for ur help in this matter Ms London i really really do appreciate it and would quite happily give u a big fat kiss for all ur help x :money:

By the way Can i ask how u accumulated ur Debt ? mine has just been through stupidity of going out with mates, holidays, etc and just being reckless with my money.

ms_london

James240 wrote:

Egg have finally got back to me and they said that any overpaymentswould be paid off the amount i owe them then interest would be calculated on the amount left that i owe them, so i guessw that would help if im paying off directly what i owe them instead of being charged interest as well.

Yaaay, thats great news. Better than it being front loaded!!! Now you just need to decide how much you will overpay them each month ;0)

James240 wrote:

Thanks so much for ur help in this matter Ms London i really really do appreciate it and would quite happily give u a big fat kiss for all ur help x

Oooer ;0) No worries. Glad i could be of some help James.

James240 wrote:

By the way Can i ask how u accumulated ur Debt ? mine has just been through stupidity of going out with mates, holidays, etc and just being reckless with my money.

Same. Exactly the same. Not proud - it saddens me to think that with the £19K i could have travelled the world already & had a deposit on a house too, but i havent, and we learn from these things. When i was really struggling with repaying the debt, someone said to me "what doesnt kill you, makes you stronger" and i totally agree (although couldve killed them at the time!!). It does make you stronger, and the Dealing with debt tips & living below your mean tips stay with you for life - ive never been so financially savy as I am now so am really grateful for that.

Anywhoo. Keep posting on here & tell us how you are getting on & good luck.

Ms_London