TravelGirl84's DFD

TravelGirl84

Hi All

Ok, here goes. I will try and make this as short and uncomplicated as possible.

My current debt stands at £28990.63 (without int.) . I was initially ok with this because I was dealing with it, and for the most part it is for big purchases and not money that I've squandered. In March this year it was approximately £31771.98, so it's down by £2781.35 in about 4 months (£1500 came from an end of year bonus), but I have also put more back on since.

A few months ago I was introduced to Monzo for a big trip I went on, and as well as saving on fees when you travel it has great budgeting tools. I managed to stay within my budget for three months and even saved money, and I was really proud of myself and started being more careful, deciding I will save for things in advance from then on. Roll on a few months later and I put a holiday and some clothes on my card, working out that I can pay it off in a few months.

A couple of weeks ago however I started talking to a mortgage advisor as the term is up at the end of the year, and I want to pay back the Help to Buy (HTB) 20% loan to the government. However despite reading the terms with a fine tooth comb it turns out that the fees and how to get out of the HTB is more expensive and more complicated than it seems. In order for the bank to loan me the extra money to pay it back and therefore take on a bigger mortgage, I need to bring my credit card down to a maximum amount, and I need to find £700 to £1000 in fees plus the broker fee. I have thought about going direct with the bank but because it's complicated, I am going to let the broker deal with it and they have advised I can pay their fee in January.

So, between a few days ago and the beginning of September I need to find just under £1600 :eek:

I have managed to work out that if I cut out a trip I should be going on, cut out the gym, return clothes which I was going to return anyway, batch cook for lunches and dinners, spend less on some things I have planned and continue to make minimum payments, I can just about do it (although I did pay more on my card than I needed to so I might need to find another £150 in cash). Pay day was last week so I have paid what I need to off the card and I have started putting money aside for the fees. If I get the mortgage also depends on what the surveyor value my home for the HTB as this will affect the loan to value. If they value it too low I may have to keep things as they are for the next two years. Like I say, it's all very complicated. I really want to sort it out though because whilst the HTB has been great to help me on the ladder, it might only get more expensive if I leave it another two years and I do feel quite tied in.

The fact that I currently have too much on my credit card for the bank to loan me a bigger mortgage is what has really got to me. I have managed to put myself in a position where debt is now really affecting me, and it's a massive weight on my shoulders. Before this I was paying off minimums and trying to work out how I can save /pay off more. I am great at working these things out and creating a budget, but not so great at sticking to them. I need to start being more of an adult now. There are so many things I want to do and am thinking of doing in the near future (a lot of this involves travel), and if I continue adding to my debt I'm worried I'll end up in a position where I'll start to struggle. If anything happened with my job for example, I do think I would struggle to get what I get paid now and be able to pay all my bills. My debt is also now starting to make me feel tied in.

I'm not sure if to post an SOA. At the moment all my spare money is going towards my CC and fees to sort out the Help to Buy, and come January my SOA will probably be different again.

Currently my loan is set to finish in January 2026, and I have two credit cards currently on 0%. I really want this paid off sooner, 2026 is so far away, and I really don't want this debt to hold me back. I know that I need to accept that I need to cut down, that I can't have and do everything I want right now, and if I continue to add to my debt with holidays (my favourite thing) and clothes etc, then I'll put myself in a position of not having those things at all.

I am hoping that I can use this as some accountability, get some tips and basically support with this. In an ideal world I would love this all paid off in the next two years (or by the end of my next mortgage term at the end of 2021), but this is really unrealistic. We can hope right?

Thanks
TG

Willing2Learn

Hi,

Just dropped by to wish you well on your debt-busting journey!

With regard to having an SOA. It is really important that it is accurate. I recommend starting a spending diary so that you can track exactly where your money is going. It is also useful to go through your bank and credit card statements to find other miscellaneous spending.

TravelGirl84

Hi Willing2Learn

Thanks for the tip. Every month I mark out what I've got to put aside for things I am doing (going out, birthdays etc, general spending). I use one bank account for bills and my Monzo account I mentioned for food, petrol and other spending, and each time you spend you can type what it is. I do this with the intention of keeping an eye on it, but actually I've never gone through the 'General Spending' section at the end of each month to see what I actually spent my money on, so that's a good idea to see if there's anything I'm spending on that I can cut out that I haven't realised!

Thanks
TG

TravelGirl84

In the spirit of keeping myself accountable, I plan to find the money I need to pay off some of my CC and save the fees for the HTB so hopefully the bank will say yes to a bigger mortgage through the following:

CC1 min payment (August) - £100
CC1 min payment (Sept) - £100
Clothing returns - £344.48 - IN PROGRESS
Payment to pay back holiday - £300 - DONE - paid £200 off CC and £100 into savings
Cancelled trip - £250 (on end of Aug payday - may have to pay hotel cancellation fees though)
Cancelled Gym August payments - £42 - DONE
Cancelled Gym Sept payments - £42
Money a friends owes me - £50
Other cancelled - £90 - DONE
Other ad hoc payments made to CC - £30.84 - DONE
Other ad hoc payments in to savings for fees - currently £0

Although there is a maximum amount I can have on my card, it would be great if I can get this down as much as possible. If only I could magic some money.

Have made lasagne tonight, had one portion tonight and will either have one tomorrow and freeze two portions or freeze all three portions.

TravelGirl84

Made some headway on food prep today. Went to the shops and spent £3.48 on some tubs for batch cooking. Have taken that out of my food budget. Made four portions of veg pasta, had one for lunch and frozen three, and I have made three portions of mash all going in the freezer. During the week I will make a sweet and sour for dinner and freeze one or more portions. I have mince and chicken in the fridge so I will either freeze that or make something and freeze it. Also frozen four portions of sausages. I have never had so much food in my cupboard or freezer, it looks like I'm about to go in to a bunker :rotfl:

Saw some living room furniture at the shops today in the style that I really love, in the sale totalling around £500. In the grand scheme of things £500 for a whole set of living room furniture is pretty good so it's really gutting that I can't buy it. I don't need it, my furniture is perfectly fine, but it's just something that makes me realise I can't just go out and buy stuff because I have all the debt instead of all the savings :mad:

Have been thinking today though that I really need to consider what I want to do in the not too distant future. Do I want new furniture or do I want to move completely, or do I want to try somewhere new and rent my property out (one of the reasons I want to pay back the HTB). Knowing that I have all this debt is starting to make me feel held back from doing anything different, so I need to face the music and spend the next I guess two-ish years getting it down or paid off. I am 35 this year and whilst I know that 35 isn't old, I feel like life will run away with me if I don't make a change. I think it is a decision of I either have more fun now, getting in to more debt, or I can put myself in a much better financial position and have even more fun after.

Anyone else feel like this?

savingholmes

Just coming to wish you good luck on your journey

katsu

If you don't need new furniture, have a think about why you want it, and whether, as you say, you want to do other things with your money even more. I know you walked away from the purchase but it might help you to think about why you were interested in it etc. A bit like Marie Kondo's approach to tidying, start with a vision for your life.

Have you got anything you can sell online? Facebook has no fees so if you can sell locally, it can be easier than eBay. Might help you get to your total a bit easier.

TravelGirl84

savingholmes wrote: »

Just coming to wish you good luck on your journey

Thank you!

TravelGirl84

katsu wrote: »

If you don't need new furniture, have a think about why you want it, and whether, as you say, you want to do other things with your money even more. I know you walked away from the purchase but it might help you to think about why you were interested in it etc. A bit like Marie Kondo's approach to tidying, start with a vision for your life.

Have you got anything you can sell online? Facebook has no fees so if you can sell locally, it can be easier than eBay. Might help you get to your total a bit easier.

Hi Katsu

Thank you for your comment.

It's just furniture in a style that I really love and have always looked out for. The furniture I have is perfectly fine and came with a package when I bought my home (it was part of a new build package), so not what I would have chosen but I do like it and theres nothing wrong with it.

I like the vision for your life idea. I feel like my vision chops and changes a bit, and it's very very different to what it was two years ago - I was married with the assumption of buying a house and having kids - now I am divorced, very happily single, have bought my own home, and not maternal at all, and I have so many things I'd like to achieve before I meet someone new, so I could be single a while :rotfl:

I have put some things on Ebay this evening. I don't really use Facebook, it's usually on deactivated because it winds me up lol. Maybe I could set one up just for selling stuff?

Thanks again!
TG

beanielou

Happy shiny new diary

TravelGirl84

beanielou wrote: »

Happy shiny new diary

Thank you