Wow wee oh my - trying to hack away at my £54k debt (was even about to book a holiday)

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  • Good luck huni xxx
  • Thanks so much i will review and reply in more detail a little later. My main issue is that I have now have a semi sensible budget to a monzo account and have taken the view that as long as i stick to that then i am dealing with the problem. I sort of know deep down that is another form of buying my head in the sand. Do you advise the dave ramsey approach and tackling debt as fast as possible. For example i have a chance to work two jobs over the coming months which would pay off some of my debt but could be stressful (same with the housemate suggestion). I am just not keen on giving my life up but i guess debt casts a shadow on life too .... 
  • One-step-at-a-time
    One-step-at-a-time Posts: 601 Forumite
    First Anniversary Photogenic First Post Name Dropper
    edited 26 October 2020 at 12:44PM
    From my own experience tackling it as fast as possible was what we *thought* we were doing, but what we actually did was cut out as much as we could bear to start with (easy wins) to make the SOA balance, then cut out more things/look for more savings as we adjusted.  The first year we were finding our feet, but with hindsight I wish we'd been a bit more ruthless from the start. I've always chosen to see it as shifting my priorities rather than 'giving up my life' - and there are *always* ways of cutting the costs of doing the things you love!
    Even a few months working an extra job would be enough to really kick start things (personally I would choose that over having a housemate but that's the introvert talking :) ). I like targeting one debt and obliterating it as fast as possible, and would pick pick either the highest interest rate (reduce interest payable) or the smallest number (bin a debt for good in the quickest time). 
    Debt-free August 21, Mortgage-neutral April 24
  • Karonher
    Karonher Posts: 916 Forumite
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    Most things have been suggested already but the groceries budget for one person is very high. I can imagine you could cut £100 off most months. Try to use up what you have in the house and then make a list of what you have left and arrange to only buy items that will allow you to make other meals from them. After that could you use cheaper supermarkets and cook more from scratch if you don't already.
    Aiming to make £7,500 online in 2022
  • I totally agree with @One-step-at-a-time - I thought I’d cut back as much as I possibly could at the start, but as time has gone on I’ve managed to cut more and more without missing it. The good news is you have a lot of discretionary categories you can play around with to make your budget balance. If you’re struggling with the thought of cutting back spending I’d suggest just getting yourself to a place where it balances in the first instance, then once you’ve adjusted to living with that you can look at cutting back further to pay back quicker. I’d also choose taking an extra job over a housemate!

    How you make your budget balance is really up to your own priorities. I think it’s important for you to find a way to keep a couple of small luxuries that are important to you, you just need to be sensible and not keep all of them (for me yoga would be an essential, for instance, and if you regularly use the gym I’d keep it. If you haven’t set foot in it in forever then cut!). You can also look at how you can cut down on categories rather than eliminating entirely - e.g. if you really can’t bear the thought of doing without a cleaner then changing cleaner from weekly to fortnightly / monthly. 
    Debt at LBM (Dec 2018): £23,167
    Debt free Feb 2021
  • From my own experience tackling it as fast as possible was what we *thought* we were doing, but what we actually did was cut out as much as we could bear to start with (easy wins) to make the SOA balance, then cut out more things/look for more savings as we adjusted.  The first year we were finding our feet, but with hindsight I wish we'd been a bit more ruthless from the start. I've always chosen to see it as shifting my priorities rather than 'giving up my life' - and there are *always* ways of cutting the costs of doing the things you love!
    Even a few months working an extra job would be enough to really kick start things (personally I would choose that over having a housemate but that's the introvert talking :) ). I like targeting one debt and obliterating it as fast as possible, and would pick pick either the highest interest rate (reduce interest payable) or the smallest number (bin a debt for good in the quickest time). 
    That is great advice, thank you. And congratulations on paying off so much of your debt. I am a bit of an introvert too, have housemates before and really did not enjoy it. Can i ask, how do you feel now you are so close to your target?
  • I totally agree with @One-step-at-a-time - I thought I’d cut back as much as I possibly could at the start, but as time has gone on I’ve managed to cut more and more without missing it. The good news is you have a lot of discretionary categories you can play around with to make your budget balance. If you’re struggling with the thought of cutting back spending I’d suggest just getting yourself to a place where it balances in the first instance, then once you’ve adjusted to living with that you can look at cutting back further to pay back quicker. I’d also choose taking an extra job over a housemate!

    How you make your budget balance is really up to your own priorities. I think it’s important for you to find a way to keep a couple of small luxuries that are important to you, you just need to be sensible and not keep all of them (for me yoga would be an essential, for instance, and if you regularly use the gym I’d keep it. If you haven’t set foot in it in forever then cut!). You can also look at how you can cut down on categories rather than eliminating entirely - e.g. if you really can’t bear the thought of doing without a cleaner then changing cleaner from weekly to fortnightly / monthly. 
    Another great and helpful response, thanks. And agree on the housemate point! I had a plan of action to tackle it but then thought i'd just remortgage next year to clear it all and then eat into some of my equity. As i type this i realise this is not really tackling the debt and is just another way of overspending?
  • I totally agree with @One-step-at-a-time - I thought I’d cut back as much as I possibly could at the start, but as time has gone on I’ve managed to cut more and more without missing it. The good news is you have a lot of discretionary categories you can play around with to make your budget balance. If you’re struggling with the thought of cutting back spending I’d suggest just getting yourself to a place where it balances in the first instance, then once you’ve adjusted to living with that you can look at cutting back further to pay back quicker. I’d also choose taking an extra job over a housemate!

    How you make your budget balance is really up to your own priorities. I think it’s important for you to find a way to keep a couple of small luxuries that are important to you, you just need to be sensible and not keep all of them (for me yoga would be an essential, for instance, and if you regularly use the gym I’d keep it. If you haven’t set foot in it in forever then cut!). You can also look at how you can cut down on categories rather than eliminating entirely - e.g. if you really can’t bear the thought of doing without a cleaner then changing cleaner from weekly to fortnightly / monthly. 
    Also ... i am stoked for you and impressed with the amount of debt you have cleared!
  • enthusiasticsaver
    enthusiasticsaver Posts: 15,585 Ambassador
    First Anniversary First Post Name Dropper I've been Money Tipped!
    Presumably you can now see how you got to £50k in debt.  I have counted up the savings you could make and it is easily £1500 by cutting back on clothing, entertainment, haircuts, groceries and holidays.  You can cut out the hot yoga, coffee takeaway and cleaner  and if need be the gym.  Your insurances are high.  Do you pay those yearly or monthly?  You pay a  lot more by paying monthly so aiming to save for things like that would cut costs.  You have a £1143 shortfall though so by cutting out what I would consider overspends by £1500 means you only have £350 to overpay your debt so it will be hanging around for a long time.  I would suggest you increase income by getting a second job and or taking in a housemate. You have definitely been guilty of lifestyle inflating which is living beyond your means and presumably for a while.  You can sort it by cutting back and budgeting but it will be a culture change. You also need to start putting money aside for emergencies, insurances and car repair costs etc to avoid you going further into debt. 
    I’m a Forum Ambassador and I support the Forum Team on the Debt free Wannabe, Budgeting and Banking and Savings and Investment boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.
  • One-step-at-a-time
    One-step-at-a-time Posts: 601 Forumite
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    edited 26 October 2020 at 3:45PM
    That is great advice, thank you. And congratulations on paying off so much of your debt. I am a bit of an introvert too, have housemates before and really did not enjoy it. Can i ask, how do you feel now you are so close to your target?
    Thank you! I have to admit, impatience is kicking in now (with any luck there's just a year to go). The payday money shuffle (and knowing that I'm getting closer to it going to savings, investments and deferred house maintenance instead of debt) is something that I look forward to, and I'm even more motivated to scrabble around for extra work and try to sell more things as the finish line is not some nebulous date several years into the future any more. My peace of mind has been greatly improved by having separate accounts for bill payments and emergency funds (I no longer begrudge parting with the money!). I guess I feel like I'm the captain of my own ship now, rather than floating in the sea clinging on to a life preserver. 
    Debt-free August 21, Mortgage-neutral April 24
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