£31k of debt to go in 18 months.

flapflop

Okay, why am I here? This pandemic has put a lot of things into perspective for me. I have seen my boss be off with long covid for over 3 months now and he is a fit and healthy guy. I am not a fit and healthy person and, as the only income for our household, our finances need to be prepared for the worst. I know this sounds pessimistic and doom and gloom, but it is the reality. Our son is disabled, and my partner is full time carer for him, and my income is all we have. We do receive DLA for our son but of course that is used for him and his needs. The truth is that I have spent a long time buying ‘stuff’ in a bid to make us happy and to buy happiness. I have finally come to the realisation that this just doesn’t work. I’ve also consolidated loans and then just borrowed more money to buy more stuff. I’m now at a point where if the car fails or the house collapses, we have no money, no savings, no back-up plan and no-where to turn. I may need to have an operation soon. If that goes t**ts up, all I will leave my little family with is debt and no future. This makes me sadder than I ever thought it was possible to be. 

No-one knows of the financial mess we’re in apart from me and I am too embarrassed to tell anyone. It’s my mess caused by me. The good news is that it can’t be fixed but it certainly won’t be quick or easy. So, here goes nothing and everything:

Paypal credit £1974.00

Bank of Scotland loan £6463.99

Yorkshire bank Loan £5873.43

Tesco credit card 0% £6299.17

Virgin credit card 0% £9507.00

Next £278.30

Very £617.09

Simply be £62.95

Total £31,073.95

There we go. £31075.93 worth of debt with absolutely nothing to show for it. No memories, no bricks or mortar, just a house filled with stuff that I have never needed. 

Right now, I know I should feel miserable and deflated but I feel kind of empowered. Like I am taking back control. I am doing this for my family so that we (or they) can have a financially secure future that we will be able to fill with holidays and good times without the regret and worry that is currently associated with that. 

Here is my income and expenditure:

Income                                                                    Expenditure

Pay £1,605.00                                                        Energy             £85.00

CTC £346.00                                                         Council Tax       £186.00

Carers £160                                                           Loan 1              £390.00 (minimum repayment)

Child benefit £86                                                    Water                £41.00 (capped rate tariff) 

Total £2,197.00                                                      Credit card 1      £99.00 (minimum repayment)

                                                                               Credit card 2      £50

                                                                                Prime                 £17

                                                                                Home insurance £19

                                                                                Broadband          £32

                                                                                Mobile x 2            £110 (20 months left to run)

                                                                                Netflix £12

                                                                                Food £200

                                                                                 Total £1,241

This leaves me with £956 per month to put towards the debts. In February and March, the money from council tax will be used towards the car insurance and MOT so sadly no extra funds there. 

I have started selling everything we don’t need or haven’t used for a year and have managed to raise £800 so far (so much optimism). I have put this into a savings account as the boiler really will need to be replaced soon (I’m hoping to eek out another year) and I would love to have the money to pay for that rather than utilising credit. 

I have put all this info into a snowball calculator and according to that I should be paying the Paypal credit first, followed by the YB loan and then the RBS loan but I think this month I will clear the Very and Simply be with the remainder going to Paypal and then clear Paypal next month. That would then be 3 credit accounts cleared in 2 months which would be a huge motivation. I also need to see about cancelling the Paypal credit as it is far too easy to pay with that in just one click. My new mantra should be ‘if you can’t afford it, you can’t have it’ but the Paypal line of credit doesn’t lend itself towards that notion. 

Wish me luck! 

flapflop

Since I wrote this yesterday I have sold quite a bit (goodbye jewellery) and have made £320 overnight. I'm trying to remain positive and see this as good thing but if that is what it sold for second hand how much did I pay in the first place? Anyway, I have used that to pay £200 off very and clear the SimplyBe account. I'm going to put the rest into savings so that I inch closer towards that new boiler. I have some things to return to next which should knock about £100 off of that balance but I can't get there today as my daily outing will be to the Post Office. I have joined a local food waste group to try and bring the food budget down but I will probably need to buy eggs. Still feeling good and feeling like I have already made a small dent. More a knick than a dent but I have damaged the debt none-the-less. Go team! 

flapflop

Ooh, slight edit to the above, I do need to buy fuel so that will be £20. The good thing about lockdown is that I am saving about £100 a month on diesel costs. 

IzzyBee

Good luck I’m sure a few people on here will be much better than me at giving advice but you are heading in the right direction well done on the sales

flapflop

Not a bad day today. Ended up spending a little more on fuel than planned as my poor car only had 13 miles left in it so £25.07 spent there. One day I will get a round figure on fuel. £2 on 12 eggs and some spinach. Tomorrow I'm going to try and return stuff to Next and buy 2 packs of Pepsi max for £14. That really is my biggest vice. Oh, its my birthday soon and I was given some money so I bought myself a .....toy. I won't go into any further details on that. That was £67.07. 

Blackcats

Hello and welcome - this is a great place full of very supportive and knowledgeable people.  .  According to my rough calculations since you started your diary you've already paid about 1% off your debt and cleared one account.  That's pretty good going!, 
I find breaking my debt down into 1% chunks and colouring in each 1% square as the debt is paid was very motivating.  You could just chose one of the debts eg PayPal and tackle it 1% at a time which would be about £11 a square.  

Hope that helps and good luck

flapflop

@Blackcats Thank you very much, that is very helpful. I will definitely do that. 

flapflop

I went to return the bits we don't need to Next but it was closed until 10. My fault for not checking so that is tomorrows job now. I sold a necklace for £35 and an old coat of my sons for £5 so that will head off into savings. I did spend £19 on Pepsi Max, £1 on veg for a stew and £2.95 on 18 ice creams. I have revisited my payment plan to clear the debt. I am going to clear the RBS loan first which I can do by July. I'm paying around £61 a month interest on that at the moment so it would be good to get that cleared. It will also free up £390 a month to put towards the YB loan which will be cleared by September. The others are 0% so I will get those cleared after the 2 interest paying accounts. Tesco first then Virgin. I should be able to clear the debts by next June which seems so far away but that is okay. 

foxgloves

You are off to a great start, Flapflop. Yes, you are quite right about feeling empowered as soon as you'd assessed exactly what you owe, & started making plans to pay it off. I experienced exactly that feeling. We have now been debt-free for a long time, but I still get a little frisson of empowerment every month on my Big Budget Day (which, coincidentally is today). Knowledge is power. I think that applies to pretty much every aspect of life. 
My mantra while we were paying off our debts was that if I have to put it on a credit card, borrow or add to my overdraft to buy it, then that's sombody else's money, not mine, so I obviously can't afford it. The money we earned each month was OUR money. There wasn't any more. 
Good luck with your dfw journey. Just remember that no shiny little gizmo you could come home with will bring you the joy you will experience when you pay off your final debt. 
F

flapflop

Thank you @foxgloves. I'm looking forward to the day that the almost £1k a month I'm spending on debts is ours. How amazing would that be? That will be a day for celebration. 

Four_Seasons

Good luck you are doing so well x