Just starting out, Sept. 2019

sassmansassman Forumite
27 Posts
Sixth Anniversary 10 Posts Combo Breaker
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Hi All,

I just want to start recording my debt war campaign - not sure how much I'll post but also, it's a help to look back and see the progress I've made even if no one else reads it lol!

Card Debt Summary as at 19-09-2019:

Total Credit Card Card Debt: £30.4K (81% Utilisation)
Down £1K in last 30 days


5 Cards make this up as follows (name/balance/limit/monthly payment)

MBNA: £7716, 10K limit, £204/month
MBNA: £6241, 7.1K limit, £203/month
Barclaycard: £10,844, £13K limit, £375/month
Aqua: £1,060: £1.2K limit, £TBA/month
Santander: £4,5,98, £6.3K limit, £123/month

Credit Ratings as at 19-09-2019:

MSE: 675/1000
Credit Karma: 589/1000
Credible: 711/1000
Clearscore: 452/700

The Aqua card was activated yesterday for its 6 month 0% balance transfer. The Barclaycard figure above included £1080 transferred from it, to Aqua. Whilst is doesn't reduce the debt, it will bring down the monthly payments. I got this card from MSE.

Payment Strategy
Bear in mind that credit providers (except for Aqua) are not offering balance transfer deals:

1. Aqua - planning to pay off in next 2 to 3 months
2. Over payments to Barclaycard and Santander simultaneously. B/C is the largest outgoing and Santander has the lowest balance after Aqua. Not sure is this efficient or recommended vs the snowball method.

Research / actions completed:
  1. No other 0% cards available to me
  2. All direct debits verified and moved to as early in the month as possible
  3. Household fixed bills made efficient as possible
  4. Other monthly costs being reduced
  5. Instead of a season ticket at around £3.8K, my 100 mile round trip commute is by motorbike at a projected annual cost of £2.7K including fuel, insurance, tax and servicing.
  6. Partner is totally aware of my situation.

Anyways - hope you all have a great day and I'm hoping I'll report back around a month from now with my debt having left he £30K range and in the £29K range.

Take care!

Sassman
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Replies

  • beanieloubeanielou Forumite
    83K Posts
    Part of the Furniture 10,000 Posts Mortgage-free Glee! Name Dropper
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    Happy shiny new diary :)
    Lou~ Debt free Wanabe No 55 DF 03/03/14.
    **Credit card debt free 30/06/10~**
    MFW. Finally mortgage free February 2021****
    "A large income is the best recipe for happiness I ever heard of" Jane Austen in Mansfield Park.
    ***Fall down seven times,stand up eight*** ~~Japanese proverb.
    It starts with you, it starts from now. *** It is ok to be me.***
    ***Keep plodding***
    Out of debt, out of danger. ***Be the difference.***
  • DebtFreeMonkeyDebtFreeMonkey Forumite
    213 Posts
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    Good luck with everything. I shall be following along on your journey and cheering you on. You got this!
  • pidge04pidge04 Forumite
    779 Posts
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    Sounds like you have a plan and you’re determined.
    CC £4,012 left to pay (was £5400).
  • sassmansassman Forumite
    27 Posts
    Sixth Anniversary 10 Posts Combo Breaker
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    Thank you to all for the encouraging words - I never expected this but it but wow, I'll be stomping the hell out of the debt!
  • edited 1 May 2020 at 11:20AM
    sassmansassman Forumite
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    edited 1 May 2020 at 11:20AM
    Hi All,
    Its been around 8 Months since my first post and pleased to report this progress:
    Card Debt Summary as at 01-05-2020:
    Total Credit Card Card Debt: £22K (56% Utilisation), this was £30K @ 81% in my original post.
    Not going to bother listing the cards as I've moved debts between them as it's all one target to me.
    Now able to pay minimum amounts + £1000/month additional contributions. Possibly more depending on the month.

    Repayment strategy change since my past post:
    My repayment strategy has changed somewhat. The only 0% card was paid off quickly and now look at the card debt as to which will be paid the quickest vs saving me the most amount when paid vs other factors. Other factors for the moment are known upcoming bills. A wage rise and bonus payment has helped towards the situation and paid off £5.3K, thus freeing up more capital.

    In addition
    1.  Approx £60 per month has been saved on work lunch by bulk preparing at home. The Covid lockdown hasn't improved this as the lunch still has to be paid for.
    2. Approx £40 per month saved on energy bills via NPower. My contract ended between my last post and this
    3.  Approx £40 per month saved from ADT security when the contract ended. Now replaced with Ring Devices. Larger outlay but lower ongoing and annual costs.
    4. Approx £40 / year saved on the insurance for one motorbike
    5. Debt has been shifted between existing credit cards where lower rates are offered. This exercise has helped a lot and would recommend it.
    6. 20% saved on motorbike service costs by taking advantage of a pay monthly deal. They discount the service charges if you commit to a year's monthly payments.
    7. £20/month saved by switching to a £20/60GB / month deal sim-only.
    8. No more takeaway / delivered food. 
    9. Smart meter installed. Really don't care about the constantly changing numbers, just about the orange light that comes on to say high energy usage or approaching the daily budget.
    10. Geek alert! Amazon Alexa now has access to the indoor lights. A routine has been set up to shut off all lights when we say "Alexa, goodnight". Planning to connect Alexa via smart sockets so we don't leave on standby using power. The electric smart meter showed that those little standby lights are evil.
    11. No ironing during lockdown! Irons use a lot of energy and as mentioned, I hate that little "high-usage" light coming on!
    12. £16/month saved by cutting my own hair! Disaster the first month I tried it but OK now. Cost of the clippers paid for after month 3.
    13. For the last six months we've not set foot in or used a large name supermarket but instead visited local Polish, African and Indian stores. We've found the same-ish food stuffs but sold in bulk - sacks of 10KG of rice for example. This has saved us a MASSIVE amount of cash and reduced the number of shopping trips required. It also supports smaller businesses. I really couldn't care about Tesco Club Card points anymore.
    14. We bought a dishwasher. They really do use a lot less water than hand washing. Larger outlay but has kept the water bills at a steady £25 / month. Totally unsure whether this an appropriate figure for our household. Will need to research this.
    15. We have a whiteboard in the kitchen showing successes, progress and remaining debt. Successes are important to record - debt can't always be about bad news. 
    16. We now make small local charitable donations every month due to Covid and also to acknowledge that the financial situation for us has improved. To me this is important as it reinforces the progress made and helps others.
    Future projections
    At current levels of repayment the debt will be paid off between July 2021 and March 2022. This is assuming I don't lose my job, get redundant etc and no bonuses received.

    Final thoughts on this post...
    I know how fortunate I am to be in a position of now paying back £1K/month with all the Covid-19 hardships around. However, to get to this point has been the hardest few months I can remember and involves a lifestyle change.
    Mentally it's hammered me: I've lost sleep, argued with myself, doubted myself and even cried. It eats into free time constantly scanning the web for cheap deals and strategies to save money. Questions, so many questions about trying to second guess in 3 months how much I'd need to keep the house running vs how much more I can pay towards the debt has tied me in knots. But now I can see light at end of the tunnel and a way forward. We have kept our Amazon Prime and Netflix accounts. 
    It's really not worth hiding your debts from your significant other - there's no way I could have got to today without my wife supporting me emotionally and now cooking the best pizza's I've ever had every Friday.
    Out of interest, only my Transunion credit score has improved by only 3 points since I last posted. The others have stayed the same and I check them monthly.
    Stay safe, stay well and if you think I've missed a trick you can share with others, do let me know!

    All the best

    Sassman
  • sassmansassman Forumite
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    0% Balance transfer arrived in my inbox today and took advantage of it. I transferred £2.7K and will have that paid off in about 3 months saving £57/month in interest which goes towards paying off the 0% card. Happy days.
  • edited 30 May 2020 at 11:15AM
    sassmansassman Forumite
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    edited 30 May 2020 at 11:15AM
    Paid off £1.3K on the 0% balance transfer. The offer is still open until end of June 2020 so did another balance transfer!

    Interesting calculation I did this week was to track the interest payments on the cards / month: Thankfully it's going the right direction. Makes me happy that my strategy is working:

    Jan 2020: £539
    Feb 2020: £537
    Mar 2020: £540
    Apr 2020: £451
    Mar 2020 £312 (Estimated)

    My current estimate is that I'll be out of credit card debt by Sep-2021
  • edited 12 June 2020 at 10:08AM
    sassmansassman Forumite
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    edited 12 June 2020 at 10:08AM
    Hi All,

    Nothing new to report apart from the debt-pile is going in the right direction. Myself and my wife decided to do some credit card cutting ceremonies next year. I'll be sure to post pictures up!

    Credit Score

    My credit scores have improved this month although to be honest they don't count for much. A Credit Score is a product the credit agencies can sell you which is more cost you don't need as credit scores are free. Financial Institutions don't use them - lending decisions are based on payment history, credit utilisation etc.

    Motorbike Insurance

    The insurance renewal on my Harley came down by £360 due to a tick box not being ticked! The question not ticked was along the lines of "Does your vehicle have a factory fitted immobiliser and alarm?". The answer was yes, all Harley's for last few years have both. So I rang them and highlighted for the form error. Always check your renewal form folks!
    The insurance saving went towards the debt-pile which has bought credit card freedom a month forward to July-2021.

    Current Credit Card Attack Battle Plan
    I've mentioned before that my strategy shifts depending on any deals/what I can pay from month to month, and I really do see this a war.
    I hate it when the enemy has it's battle-win by adding the interest on when the monthly gloating (statements) come out! However, they're on the losing side against me.
    The current strategy is against the Aqua 0% deal which will be paid off by the end of July-20 and then all assault out against Santander with every penny I can spare.
    In total by the last quarter of this year around £7.1K will be wiped off the debt-pile. Santander have the highest interest rate at 29% but the lowest debt value of all my cards at £4.4K. It's an attractive target.
    My current arsenal of funds stands at around £1.4K / month over payment thanks to all the hard work this years on savings. It is really worth going through your monthly spend and making those hard decisions.

    Post Credit Card Wars
    This week I've been thinking about my life when I get released from the Credit Card wars.
    At the current levels of minimum payments + my over payments I'm currently spending just under £2K per month. With this realisation I've set myself a new target starting at the end of 2021 which is to save £100K before I retire.  
    So, £100K divided by £2K per month is 50 months which is just over 5 years and I'm 10 years away from retirement. Of course a lot can happen between then and now but I think it's good to have a basic plan in place. 

    Final Thoughts
    The next few months are going to be interesting. The credit card enemy has lost a lot of money due to the current Covid-19 situation. I read that easy-access savings are up and credit card spending is down or being paid off like me. I'm wondering if they'll do something to recover that money through useless add-on products or new T&C's which favour them.Sure enough I think there may be more 0% free deals emerging which if I can I'll take advantage of.
    Regardless, if you're reading this, keep fighting your corner. Any over payment is a major win for you and a loss for them.

    Till next time...

     
  • edited 19 August 2020 at 1:06PM
    sassmansassman Forumite
    27 Posts
    Sixth Anniversary 10 Posts Combo Breaker
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    edited 19 August 2020 at 1:06PM
    So a few things happened in the last few weeks...
    1. My total credit utilisation dropped below 50%
    2. My credit rating and affordability metrics shot according to MSE Credit Club 
    3. Due to working at my dining table, my back is killing me and invested about £1K in a sit stand desk, new chair and associated cable management and power accessories tipping me back over 50%
    4. I bought a £2K UHD camera.
    Thanks to points 1 and 2 I came up as pre-approved for a Virgin Money balance transfer card with an £8K limit (!!!!) over 22 months. I can transfer most of the expensive Barclaycard debt to that as soon as it's set up and close down the MBNA cards as they'll be paid off in the next month or so. All this debt shifting will result in only 12% of my monthly card payments having any interest applied to them. It was over 60% at the beginning of the year. Result.

    Thanks to point 3 my back is a lot better.

    Point 4 was a moment of weakness. My justification was "a reward for the progress since I started this". 
    Still on track for the 2021 credit card free position - just a bit later in the year.
  • sassmansassman Forumite
    27 Posts
    Sixth Anniversary 10 Posts Combo Breaker
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    I've now shut down three cards which leaves three and of those, only 1 is charging interest. I've had to shell out on household white goods that needed replacing, some garden stuff and other bits and pieces but hopefully, by then end of 2020 I should have at a £14K balance. Can't believe it was £29K at the start of the this year!


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