Want to be debt free...where to start?

Kiittykatz

greensalad said:

Kiittykatz said:

Hi, thanks for your input. I definitely need a budget. I have been looking at YNAB but it bugs me that it’s in $. Any other suggestions? I have categorised my spending using MSE budget planner. I changed electricity, mobile phone providers etc. Most of my debt is historical. Buying things with debit or credit without thinking it through. Never saying no. I have stopped that type of expense, especially holidays (Covid helped). I also have been the main breadwinner for years with my ex husband, step children and now my children and my now husband has only just started work. I have been on maternity for a year only returning to work last month. With all that we are now in the best position to tackle this. My spending on the SOA will not highlight the madness of how the debt has run up so high as we have already reigned it in a lot. Should say the 19k loan was to extend the lease on my house ( not ideal but not just spent on clothes and holidays!) 

Really appreciate your input. 😀

It's not in $? You choose the currency when you create the budget. There are a few Americanisms (e.g "checking account" instead of current account) but nothing that gets in the way of budgeting. 

I don't think anyone here will judge you for what the debt was spent on. I once bought a £350 scarf because I fancied it. Actually I bought 2 £350 scarves. We're all in debt for some reason or another.

I guess my question is, can you say off the top of your head how much you have this month to spend on, say, takeaways? Groceries? Clothes? A day out? How much does your car cost you per year, when is the next annual subscription (Disney Plus, Amazon Prime, that sort of thing) coming out? Have you planned for it or will it catch you by surprise?

This is my personal approach to going debt free and it 100% has revolutionised my life and how I spend money. It's not all about going without either. I'm going on a pretty expensive holiday next year. Silly idea? Maybe, but I feel at least my debt is low enough now and I know how much the holiday will cost and have already set aside money for it so I feel content going and it feels worthwhile to me. Budgeting properly gives you that sort of freedom.

I strongly suggest even if you don't use any software in particular you try the envelope method of budgeting. Not with physical envelopes but through software that does it for you or even your own spreadsheet. Start breaking down how much money you have per month and where it needs to go, what jobs it needs to do.

With a healthy salary like yours you should see how much you have to service debt each month, and using a snowball calculator you can quickly see how soon your DFD is which is really motivating. Once you know your DFD you might even decide that a holiday would only push that back a month or two and therefore might be a possibility for you. 

Having knowledge of your spending is the ultimate key to financial freedom imo.

I bet your £350 scarf looks bloody good though!
I feel really encouraged to hear its not all doom and gloom as that is the bit I find hard. I always use a spreadsheet to track what bill goes out on what day but I am in the middle of adapting that to actually budget. 

What a wonderful feeling to of set the money aside and paid it off in advance. I am SO looking forward to that part and can't wait to feel that financial freedom you talk about.

I opened a Monzo account today to start up the money pots. Really looking forward to the card arriving so I can get it all set up. 

Have a good evening

MasterG83

I would be knocking out those arrears first, make sure your four walls are strong, get the water paid then the service charge. The quickly get rid of the kitchen debt. These are three quick wins and will make you feel so much better mentally.
Then get an emergency fund together and stop borrowing.