Picking up (not quite) where I left off

JohnJ76

Ok, so rewind a couple of years and my balance on loans and cc's was £31,746
Not much has happened since then, a pandemic or something like that, nothing out the ordinary really! 
Fast forward to the middle of 2021 and I'm still paying it off.  I'm just about to make an overpayment on a loan which should be clear as of August but as of now my debt stands at £22654.  It's still too high but its nearly into the teens which will be a big moral booster.
Its not as low as I would have hoped but on the plus side I've accrued £7k in savings as an emergency buffer and going some way to building 3-6months savings as if the events of the last 12months have taught us anything, it is life is unpredictable.  I know many people would think I'm mad to not pay it off the debt but I'm happier having a healthy cushion should the worst occur, and whilst my cc's are at low or zero interest, I can't see the point of paying them off, only to have to make emergency purchases at a higher rate.
I'll try and check in more regularly than I did last time.

WinterWarrior

Welcome back and good luck.
Have you considered capping your emergency fund at £5k, hammering the debts and then going back to top it up once they are gone? It might move things faster. 

enthusiasticsaver

I think if you are not paying interest it makes sense to have a healthy emergency fund given the precarious economy at the moment. @WinterWarrior makes a good suggestion though about capping it. Depends on how secure your job is 

JohnJ76

I appreciate what you are saying @WinterWarrior  but the extra in the bank affords me a bit of peace of mind should anything unexpected rear its head and its at a decent level so I'm not too worried about adding to it any further for now.   We've had income reductions and a job scare is one of the main drivers behind having the buffer, if worst came to absolute worst I'd rather a cc default than not pay the mortgage, although hopefully it will never come to that.
On the plus side there seems to be a decent amount of overtime if I want it on the horizon, so it may be a case of make hay whilst the sun shines, although now we are allowed to actually do things its going to be hard giving up my weekends even if the pennies come in useful.

WinterWarrior

I would love overtime. I haven’t had any opportunity for about 20 yrs (my industry likes you to work for free to get things done 😬). I used to work every Saturday and half day Sunday when we had a phase where it had to happen...it always felt so relaxed and more like fun at the time.
I definitely agree that the mortgage is the number 1 priority. Everything else is easier to dig your way out of, but it sounds like you have a plan and will do great with future pay downs 🍀

JohnJ76

Well we won't even talk about the result last night and rather focus on less depressing things!

Managed to get a bit of the overtime in but due to pay cut off dates it will dribble in over the next couple of months, still its good to know it is there and will hit at some point.  

overall outstanding now stands at £21,542.   Hopefully well before the end of the year that will read £19something which sounds much better.  I've a few things i'm going to sell after a bit of a clear out but that won't amount to much as I tend to make do and mend in anycase and buy things I need, really not materialistic at all.

Oh well, back to the grindstone in anticipation of some very grumpy boys coming home after school.  Always the world cup I suppose....  

JohnJ76

where on earth did the summer hols go.. distant memory already, although it was good that we were busy this year, not like last.

so after spending a bit and saving a bit I'm down to £20,838 a the end of last month.  I've very nearly paid my last payment off a loan so I'll just have everything on cc's and can use some of the loan payment to pay those down.  It's getting there, slowly but surely. 

 

JohnJ76

I'm sure similar things have been said by other people in the past on here but when faced with a mountain of debt, don't be too harsh on yourself.  

Its very easy to be judgemental, and your own worst critic, ''I wish I'd never spent all that!!'  ''I wish I wasnt so stupid''  but having had the past 18months where life has been put on hold I have mentally checked off the things we achieved and did with the money that was borrowed.  Some amazing times, some things which have benefitted the house etc.  Yes there are inevitably some things that we could have done without but it wasn't all wasted for sure.

So if thats the phase you are going through (I know I did at one point) cut yourself some slack, you are doing the right thing in reducing the burden and slowly but surely you'll get there.  hope everyone is having a nice day. 

Blackcats

You are right - I've wasted lots of money over the years but some of my overspending has resulted in some great experiences and a few useful but un-budgeted spends for the house.  My most financially irresponsible but best holiday was a 3 week trip to Australia funded completely on credit cards, including withdrawing cash to spend from the credit cards 😱

your debt will soon begin with a 1 instead of a 2 - great progress.  

enthusiasticsaver

You make a good point in that if the money was spent on making memories (holidays), home improvements or even a car then you can say it is money well spent even if you are still paying for it some time afterwards. When we used to have loans etc I resented the monthly payments going out of our income each month so called a halt to borrowing full stop.  We still did things but cheaper and on a budget which often were just as nice as the £5k holidays or whatever.   Best to look forward but ideally saving for these things in the future is better if you can do  that. 

Almost below £20k so that will be a good threshold to get below. 

JohnJ76

well after a bit of a hiatus due to family illness I'm back on track and have managed to get a bit more paid off.  not as fast as I would have liked but it is going in the right direction.  Onwards and downwards in this case!