Sorting out the mess 'past me' got me in to, for a happier 'future me'

enthusiasticsaver

FOMO_overspender said:

Thanks so much for all your advice @enthusiasticsaver - it's really helpful. Totally agree re: the debt consolidation loan. This is actually my second one, as I fell in the trap years ago with a £10k DC loan which I then used to pay off everything and then still used my credit cards (I know!). So this time I have been super strict, cut up all my cards, closed all credit card accounts paid off and frozen the one I have currently on 0% for transactions, so all I can do is pay it off. So far, this has worked well. I also have a £100 direct debit to ensure that the CC is paid off before the 0% finishes - so I can concentrate on OP on the loan to save interest. 

Spending diary already up and running I find whilst Monzo etc all do this for you as well, having to literally write it down in a book at the end of the day makes me question so much more whether I should spend. I am more excited about marking off NSDs in the diary section, so that spurs me on to really evaluate everything I am spending. 

Thankfully the one financial responsible thing I have done is have a pension set up. I pay in 5% of my wages pre-tax a month and my employer pays in 6%, so a total of 11% each month is going in. I am hoping to up this to 10% at some point.

Assets - I totally agree. My ideal is to save a deposit to buy a flat. I live in London, so that is quite a large amount of ££ but I have a Help to Buy ISA which currently has £2.50 (I opened it before the deadline) and have decided to put £50pm in whilst I am trying to get rid of debt. 

Sensible to stop using the cards then especially if you have consolidated debt unsuccessfully before.  Try and get in the habit of checking your bank account or budget spreadsheet before agreeing to meals out, holidays, tickets etc.  It is a good idea to set the direct debit for £100 for the Virgin Media card and once you are no longer paying £500+ per month towards debt for things bought previously you will have a deposit saved up quickly if you can stay disciplined. It is just a question of deciding on priorities. 
I have never used Monzo but some people rave about it and I find writing down spends just focuses the mind on what is really important.  I am not a fan of cutting out all treats while dealing with debt ( especially if this will be a long journey) but I do think deciding on what is most important is easier when you have to think about it and write it down in a diary. 
Having a pension is good and opening the HTB ISA while it was still available was great. I have subscribed to follow your journey.  

FOMO_overspender

Thanks so much @enthusiasticsaver - this diary has helped me already so much! Thanks for subscribing too. Having people there along the way people with tips and encouragement really makes a huge difference - little cheerleaders and people to keep you in check too. It also makes you feel less alone in the battle. While I have told a close friend about my debt, who is super supportive, it's not something I have shared with any other friends. They do all know I want to save to buy a flat, so it's a good reason to say I can't do expensive dinners, holidays etc without saying I am paying off debt, as I am *technically* doing both! 

Applewood1

You sound really positive, which is great! I was in a similar situation to you a few years ago and managed to pay off all debt by being disciplined as possible and using a budget / paying attention to where my money goes! It gets addictive after a while. I'd agree with some other comments though - figure out what's important to you in terms of spending money as "treats" or whatever as otherwise it can get lonely fast. Personally, I love live music and gigs so prioritised that as my treat and didn't want to cut that out (even though it's expensive!) but all other frivolous stuff was cut back / stopped. 

FOMO_overspender

Thank you @Applewood1 appreciate the encouragement
For sure, thankfully, one positive to this whole situation is has really made me look at how much I spend on things that aren't important to me. I am watching Nick True's YT tutorials on YNAB as well to get to grips with rigorous budgeting.

I think moving forward I will still keep eating out etc but be much more confident to say no when I reach my budget limit. Before, I didn't dare say no and would just crack out the credit card to pay for things and here we are, working to pay off a debt that would be a very good deposit on a flat!  

Today has been another NSD and also managed to complete 2 x Prolific surveys too. 

Hope everyone else has had a good week

FootyFanDan

Well done on the NSD

I have spent a lot of time watching the Nick True stuff as well back at the start of my journey and still to this day watch his videos even the non YNAB ones. I echo what @Applewood1 says too, if you cut everything completely you may lose motivation. I had to decide what was really important and that i was adamant i was not going to drop but then find ways to ensure that was covered by trimming other areas of budget. 

Hope you had a good week 

Moneywhizz

Sounds like you are really getting on top of this now. The most important thing is setting the budget and sticking to it. Soon that will become normal for you. It is not something that you do for a little while, even when debt free, and then go back to free for all spending. Having a budget is a lifetime habit that will allow you to get the most out of your money and achieving the realistic goals that you set yourself. Your test will come when normal lie resumes, but it seems like you do understand that you need to check your budget categories before committing to anything, which the the key to staying in control. Well done for all the changes you have made so far. 

FOMO_overspender

Thanks @FootyFanDan and @Moneywhizz having a realistic budget is definitely key! YNAB so far feels like it will help me massively. It's feeds the OCD side of my personality, having all the categories and goals etc. 

Anyone who reads my diary ever had a loan with M&S? I am finding that their online banking is so limited, all I can see is the total owed. It would be nice to be able to see what a difference to the interest my OPs are making? I know in reality that driving that figure down is going to help, but just be nice to spur me on mid-month when I know that I have saved myself even £2 of interest. I am sure this is just their way, but in case I am missing something to be able to see more info online?

EssexOstrich

Hi FOMO,

Just having a read of your diary, I’m fairly new to this but can totally relate to everything you’ve said. You’ve made a brilliant start, well done. It definitely gets a bit addictive and weirdly I now get a buzz from making an extra payment to my mahoosive debt. Never thought I’d say that!!

Good luck with your debt free journey!!

Xx

FOMO_overspender

Hey @EssexOstrich
Thank you for the encouragement and for sure, I feel like I am so motivated to OP but need to remember that this is not normal times. I have been really scrutinising my budget and making sure I still have a line in for things I know eventually I will have to pay even if I am not now, so I can't forget they will be there (e.g travel, eating out). I am also going to add token £10 in each to save for them - so at least I have a head start for those as well. 
Thank you! Will subscribe to your diary too - you've made some great progress! x

Mahsroh

FOMO_overspender said:

Thanks @FootyFanDan and @Moneywhizz having a realistic budget is definitely key! YNAB so far feels like it will help me massively. It's feeds the OCD side of my personality, having all the categories and goals etc. 

Anyone who reads my diary ever had a loan with M&S? I am finding that their online banking is so limited, all I can see is the total owed. It would be nice to be able to see what a difference to the interest my OPs are making? I know in reality that driving that figure down is going to help, but just be nice to spur me on mid-month when I know that I have saved myself even £2 of interest. I am sure this is just their way, but in case I am missing something to be able to see more info online?

I don’t have a loan with M&S, but HSBC is the same. They don’t adjust the interest so if you make an overpayment of say £50 that will reduce your balance by roughly £65, but they’ll only show the £50 reduction! It’s really annoying, but If its the same as mine the only way you’ll know is to ring them and ask for a settlement figure.