My debt free diary (and first post)

wellyftw

Hi all,

I joined this forum a couple of years ago but never posted for whatever reason. Today as I've started paying off some debts, I thought I'd use this as an opportunity to hold myself accountable to paying off some debts. I don't think I'm in the worst position, in fact I'm in a pretty good place despite having some debts.

Not really sure how best to format this, but I'll give it my best shot.

Debts

Barclaycard: £3,306.32

Paypal Credit: £2,997.81

Black Horse PCP Loan for motorbike: £13,264.24 (Settlement figure £11,416)

Yikes. When I put it all down like that, it looks awful. But there is a light at the end of the tunnel.

The Sainsburys Bank Loan was to repay off my narrowboat, my home which I live on. I originally had a "marine mortgage" for the boat of about £30,000 and was able to reduce that down to £18,000 in a couple of years. The interest rate was quite high but at the time I'd been living outside the UK and had no credit status. Eventually I had managed to gain enough credit worthiness to get Sainsbury's to give me a loan at a much reduced rate, so have been paying that off. The other loans have been loans for both frivilous and non-frivilous purchases. They are what they are.

Today I paid £1000 off my Barclaycard (it was over £4000) and I have paid off my First Direct personal loan - the settlement figure was about £750. So I'm happy with that, it feels like progress.

Sadly earlier in the year my aunty died but very kindly left me £20,000 in her will and my mother has said she would also give me £5000 from the money my aunt left her so that gives me £25000 to reduce my debts. I think it will be a massive game changer for me.

My first thought is to pay off the boat - I will be doing that for sure as that is a £850 a month repayment. There is a lot I can do with an extra £850 a month in my pocket. The settlement figure I would guess would be around the £13,000 mark, perhaps even less. My second thought is to pay off the motorbike, which is £200 a month. Those are my two biggest monthly expenses so it seems wise to me to get rid of those first. I had always planned to keep the bike and not trade it in for another one after the PCP contract ends and at the time (I needed some transport!) the PCP contract was the only way I could afford to get a new motorbike. My older bike had given up the ghost and was becoming unreliable. My parents have let me know that the will is has gone into probate and are estimating I should have the money by September.

My monthly income is around £3200 so once the boat and bike are paid for, I should be in a pretty good state of affairs to pay off the barclaycard and the paypal credit account. I'll be aiming to get rid of those asap - maybe paying each one off £500 a month? Then I should, in theory, be debt free within 6 months after I've got my will money. And then I aim to put my monthly salary to good use and try and get some proper money saved up.

So that's me. Sorry for the lengthy post, if anyone is still reading!

ZaSa1418

You are in a good position and it's always good to have a plan, good luck  

Isitdoable

What a wonderful gift from your Aunt, and I'm sure that helping you out to this degree would make her very happy

Thats a great starting point, have you done a statement of affairs so you can see what your position is going forward to get everything else cleared will be?

wellyftw

Isitdoable said:

What a wonderful gift from your Aunt, and I'm sure that helping you out to this degree would make her very happy

Thats a great starting point, have you done a statement of affairs so you can see what your position is going forward to get everything else cleared will be?

Hello and thank you! I've no idea what a statement of affairs is so I think I need to do some reading!

pidge04

You live on a narrowboat - what joy! Is it wonderful? 

wellyftw

pidge04 said:

You live on a narrowboat - what joy! Is it wonderful? 

Mostly is! It can be a bit miserable at times when the weather is like it currently is. Even winter is better than this because at least in the winter you're stocked up with fuel for the stove and you can get warm! I'm out of coal and wood at the moment - it is July after all!

wellyftw

Isitdoable said:

What a wonderful gift from your Aunt, and I'm sure that helping you out to this degree would make her very happy

Thats a great starting point, have you done a statement of affairs so you can see what your position is going forward to get everything else cleared will be?

I found the statement of affairs. That was a useful thing to fill out!

wellyftw

Filled in the statement of affairs. Definitely useful and reminded me of a few more smaller debts that I have, which I bit the bullet and cleared last night.

So, Currys/PC World loan is paid off now, personal loan is also paid and I had a £100 remaining for some tools I bought that I've paid off.

That means remaining debts to pay off are:

• Black Horse motorbike PCP contract
• Paypal Credit
• Sainsbury's Bank Personal Loan

and couple of other loans I'd forgotten to add, for another tool I bought for some work on the boat and for a phone after I dropped my phone in the canal 

• Tool loan £833.50
• Phone loan £1063.70

The phone loan was a rather indulgent purchase but I do tend to keep phones for a long time and so I expect this to cost me about £250 a year, if not a bit less, ie. I'll keep it for 4-5 years.

It does mean that next month I'll be paying over £100 a month less in repayments so that feels like a bit of progress.

Also closed down a few other online subscription services (some gaming and tech subscriptions) that were only a fiver here and there but all add up and not really necessary. I should be about £150 a month better off already so feeling happy about that!

[Deleted User]

wellyftw said:

Filled in the statement of affairs. Definitely useful and reminded me of a few more smaller debts that I have, which I bit the bullet and cleared last night.

So, Currys/PC World loan is paid off now, personal loan is also paid and I had a £100 remaining for some tools I bought that I've paid off.

That means remaining debts to pay off are:

• Black Horse motorbike PCP contract
• Paypal Credit
• Sainsbury's Bank Personal Loan

and couple of other loans I'd forgotten to add, for another tool I bought for some work on the boat and for a phone after I dropped my phone in the canal 

• Tool loan £833.50
• Phone loan £1063.70

The phone loan was a rather indulgent purchase but I do tend to keep phones for a long time and so I expect this to cost me about £250 a year, if not a bit less, ie. I'll keep it for 4-5 years.

It does mean that next month I'll be paying over £100 a month less in repayments so that feels like a bit of progress.

Also closed down a few other online subscription services (some gaming and tech subscriptions) that were only a fiver here and there but all add up and not really necessary. I should be about £150 a month better off already so feeling happy about that!

That's fab progress so quickly, well done

thriftyish

Brilliant progress. It sounds like you are in a really good place. Have you seen the snowball calculator? It works out which debt you are paying the most on, and lets you know the best order in which to pay off to save as much money as possible. I would absolutely love to live on a houseboat, but DH wouldn't entertain it and I am not sure where I would put the four children! 

wellyftw

thriftyish said:

Brilliant progress. It sounds like you are in a really good place. Have you seen the snowball calculator? It works out which debt you are paying the most on, and lets you know the best order in which to pay off to save as much money as possible. I would absolutely love to live on a houseboat, but DH wouldn't entertain it and I am not sure where I would put the four children! 

I shall look up the snowball calculator! I'm sure it'll help plenty. And the kids can go on the roof!