LIGHTBULB!

Aurora1710

Does anyone else think of the minions/despicable me when they hear lightbulb?

Today i’m starting my diary. I’ve previously been on the forum, many years ago and whilst my debt is better “controlled” it’s probably the same amount. It’s time to really knuckle down and get rid of it. So here we go.

I’m 34, married, two pre-school aged kids (they start this year!) and I work part time. In terms of work i’ve been a full time nurse for 11 years, part time for a year due to mental health/childcare and have just successfully applied for another full time post which I should start around May. I also have a small business selling crochet items which has a variable income, from £25 to £200 a month

Debt wise it started with a £1000 loan when I was 23 and i’ve never been debt free since, my current debt is £21,940.04 over three accounts. We’re saving up for a mortgage too as we hope to be in our own house this year (currently living with family).

As an overview of my current income/outgoings picture:

Income:

Current wage - £1550-£1650 p/m
Business - variable
Outgoings:
Savings - £100 (help to buy ISA)
Joint account - £500
Loan - £376.50
Phone - £45
Tamba - £3
Unison - £21.32
Life insurance - £30
Credit card - £100-£150
Diesel - £60
Website - £22
I also have a quarterly payment for NMC which is £30
Overall I’m usually left with £200-£250 depending on my main income and I have no idea where it goes, more if I have income from my shop but that usually goes back in to buying yarn. I make a small profit just now as i’m just new to it.
Debt:
Very - £110.10 (interest free until May 2021)
Credit card - £4,771.50 (interest free until October 2022)
Loan - £17,058.54 (final payment March 2025)

Plan:
- Pay off Very by May this year
- Increase credit card payments now to £200 and then again to £400 in May when (a) my Very is cleared and (b) my full time wage starts
- Overpay loan when credit card is cleared
I’d love to have my credit card paid off by December but realistically it’ll be March 2021 which i’m still happy with. Once the credit card is gone i’ll likely split the £400 between savings and overpaying my loan.

I need to write down and go over the figures a final time but I think i’ve got them correct. In terms of my phone, I’m on a sim only contract which is £20, the remainder is for my Apple Watch which i’m paying off at £25 and then that’ll be reduced further.
My life insurance is also the lowest quote I could get for life and critical illness due to having asthma and post natal anxiety which I take medication for.

I cant wait to see what stage i’m at in 12 months time. I’m so determined!!!

TheAble

Best of luck with your journey. How much do you have saved towards your house deposit? Things may have changed in recent times but I don't believe mortgage lenders would be overly keen to lend while you still have other debts outstanding.

Aurora1710

TheAble said:

Best of luck with your journey. How much do you have saved towards your house deposit? Things may have changed in recent times but I don't believe mortgage lenders would be overly keen to lend while you still have other debts outstanding.

Thank you
We have £12,000 saved so far. We already have a mortgage in principle which expires end of this month and we’re letting it lapse as we haven’t found the right house yet. We had a few viewings lined up and most places asked for proof of the principle before we viewed so we got that.

Strangely, despite my debt, I have an excellent credit score which i’m really happy about. I’ve never missed a payment and my loan has a very low interest rate of 2.7% so i’m not sure if that’s helping my score perhaps.

Of course when it comes to going through with a full mortgage application they could very well decline us based on my debt, I really hope that’s not the case

[Deleted User]

Hi @Aurora1710, best of luck with your debt free journey.  I too want to move next year but our debts have prevented us moving forward.  I have personally found that credit card debt really made the difference in how much we could borrow as it's all down to affordability.  If we clear this then our prospects are looking more positive.  

Aurora1710

Thanks @MrsBrownBear, good luck with yours too. I need to just plough all my money into that credit card and get rid of it.