Seen The Light

ste82

Having always been 'bad' with money, I've finally seen the light and it's time to get things sorted.
Realisation hit in January so I'm already making progress, but thought a diary would be useful to keep me motivated and track progress.
I don't really want to go over the full background as I've already done it with the wife(!) but basically I never made the transition from being young and responsibility free doing whatever wanted with my money, to adult with children etc and used credit where I previously had disposable income. I expect the same tale has been told on multiple threads, spending beyond means, not wanting to say no, keeping debts to myself, consolidating debts into loans but then building up more debts etc etc. I realised that I'm earning quite good money, but I have no money (!) and that the house we live in isn't great even though colleagues who earn similar amounts have something much better.
I've had the difficult conversation with my wife and she now knows the full picture of my (our) finances, we've made a plan to move ourselves into a better position.
So debts as of 11th January when I came clean:

Loan 1 (Home improvements known by wife) - 328.35 pm three years to run.
Loan 2 (Car loan known by wife) - 195.83 pm three years to run.
Loan 3 (Debt consolidation hidden) - 181.40 pm four and a half year to run

Credit card 1 - (Hidden) £7822.07 - 0% expires 05 Feb 2022
Credit card 2 - (Hidden) £9602.23 - 0% expires 12 Mar 2022
Credit card 3 - (Hidden) £517.69 - 0% expires 01 Sept 2021

I'll do another post for where we are as of today.

ste82

Update for how things now stand.
We decided that although the CCs are 0% it was best to try and tackle them first. We'd like to move house soonish and believe they'll have the biggest impact on affordability, so we'll make the normal monthly payments against the loans until the CCs are sorted.
In January and early February we've made some quick and obvious changes that have enabled us to make some payments as follows:

• We had a second car sat on the drive doing nothing, I was using it for work but since COVID I've been working from home, even when we're back to normal I'll only be required to go to the office infrequently - we can make it work with one car. Car sold for £5K, insurance DD canceled, tax refunded
• Reviewed outgoings made some changes and produced a master money spreadsheet - halved sky bill, changed to cheaper boiler cover with cashback for new policy etc
• Reviewed our life cover (with an appropriate advisor) realised we doubled up with a work benefit so over insured, made the necessary change and reduced cost by £40 pm
• Committed to £350pm each against CCs, we're also saving £50pm each for an emergency fund (currently at £850) we're going to continue doing this rather than stopping at a set figure as there's always something that need replacing, fixing, buying, dog to the vet etc every few months
• Set a monthly budget for food & petrol, this was adequate for the first month with a small amount left over petrol was more that usual as I had a 400 mile round trip to attend a family funeral
• Gave ourselves £150 each as pocket money each month - we discussed it and living a completely spartan life long term isn't going to work
• No council tax for the next two months so extra against the CCs
• Had a flea bay session getting rid of some old electricals etc 

Updated CC totals:
Credit card 1 - (Start) £7822.07 / - (now) 5910.06 0% expires 05 Feb 2022
Credit card 2 - (Start) £9602.23 -  (now) £5910.06 0% expires 12 Mar 2022
Credit card 3 - (Start) £517.69 / (now) £0

So good progress! Getting rid of CC3 felt good even if it was a quick win. As per the list above there some obvious quick wins that have had a big impact (the car). I'm now thinking that we're moving into 'the grind' where we'll be paying off our budgeted amount each month.
Pay day tomorrow so I'll update with new totals. This month has gone well, we've stuck to our budgets with no issues.

RelievedSheff

Well you are making excellent progress so far. Keep it up and those card balances will drop quicker than you realise.

We have also paid off all of our easy targets first and have just cleared the last easy target this week, so we are just at the start of the long grind with the larger balances now.

designingalife

Well done on the great progress you have made a great start 👍

ste82

RelievedSheff said:

Well you are making excellent progress so far. Keep it up and those card balances will drop quicker than you realise.

We have also paid off all of our easy targets first and have just cleared the last easy target this week, so we are just at the start of the long grind with the larger balances now.

It felt great to get started, I felt a massive weight had been lifted off my shoulder when I fessed up!

I thought it was important to acknowledge that after the initial flurry of quick wins we were going to drop into the 'grind' and we wouldn't be making big payments on the CCs like we did when we sold the car.
Still with the plan we've got we'll still be paying off £700pm from the CCs. We're fortunate to be in a position to be able to do that in these times!

FootyFanDan

Well done on the quick wins, you have already made great progress. Good luck on your journey, I found the grind the hardest bit too to be honest as once you have the initial buzz of getting the cheapest ones gone you get used to that feeling of paying one of, but as long as the balances are coming down then progress is being made

ste82

FootyFanDan said:

Well done on the quick wins, you have already made great progress. Good luck on your journey, I found the grind the hardest bit too to be honest as once you have the initial buzz of getting the cheapest ones gone you get used to that feeling of paying one of, but as long as the balances are coming down then progress is being made

Thanks, it's been great so far. I'm happy with where we're going, with the plan in place each month we'll be paying those bloody CCs down.
I think part of this journey is realising that there aren't any quick wins out of this, we're budgeting our money properly and spending less than we have coming in and paying down whatever we can each month. If we can stick to the plan we'll get where we want to be!

ste82

Payday!
Not as big deal as it would previously have been as I'm not in my overdraft and penniless!
Paid a total of £588 off the two remaining CCs. My normal £350 that I'm committed to each month plus the cash that would normally have gone on council tax. I also had £50 pocket money left over, so have used that as well.
OH will add her £350 contribution in the next week or so when she gets paid, so we'll be approaching 1k off the cards this month! I'll update the totals on here once that's done.
I've also transferred £50 over to the emergency fund and added this months food and petrol money to the separate cashback card we use for that pot.

A good start to the day!

ste82

Good work news, had my annual appraisal and will be getting 2.83% pay rise effective April 1st. Really pleased as thought it might be a 0% year.
Planning to spend £5 on a wire brush this weekend as there's some paint marks on the brickwork on the front of the house that I've been meaning to get rid of for a while. Other than that the wallet should be kept firmly shut over the weekend!

LittleMissDetermined

Congrats on the pay increase and well done on your efforts so far! clearing a card certainly gives a boost and will spur you on. I hope it can continue for you

LMD x

EssexOstrich

Well done! Your story is exactly the same as mine and I've approached it in much the same way paying off the quick wins etc., You're bigger than me though, I've still not 'fessed up but I'm fixing it all myself and will tell the hubby when it's nearer an amount that won't kill him. It's definitely a massive relief to deal with it though despite being boring once the novelty wears off! Welcome to the club