100k - is not ok!

Skint_but_Optimistic

I have had it with spending and having no emergency fund and the debts are just hanging in there. I need to get an emergency fund sorted of 5k. I need to get rid of debt. (currently at £94 831 - including mortgages) So lets call this 100k. My 100k challenge - should be fun. Hoping for support and encouragement and dragging me back on track when I fall by the wayside! Looking forwards to reading everyone's diaries.

Karonher

Good luck - what are you planning to do?

tacpot12

Good luck with your challenge. One observation though - rounding numbers up and including the mortgage in your debt figure are not always conducive to driving the right behaviours. While paying off your mortgage, and doing so early, is very good for your financial health (e.g. it allowed me to retire from a job I hated at 53), it should be lower down the priority of your financial goals. I would say that the No .1 priority is to pay off your debts while simultaneously feeding your emergency fund - e.g. 90% of surplus income to debts, 10% to the emergency fund. Once the fund is at £5000, start putting the 10% into your pension. Once your unsecured debts are clear, hit the mortgage hard.     

I would also encourage you to be precise, at least to the pound, about your other debts and your spending. This is part of the discipline you need to pay off the debts as quickly as you can. 

If you have not posted a Statement of Affairs (SoA) on MSE, I would encourage you to do so, as you will get feedback and ideas about how to reduce outgoings so that you can clear your debts quicker. I would also encourage you to, as part of the SoA, suggest the order that you are going to tackle your debts in. Again you might get suggestions that would improve this order of 'attack' so as optimise your approach.  

Skint_but_Optimistic

The thing is, the debts all have 0% interest applied and all have payment arrangements, and there is only a secured loan outstanding (as well as the mortgage) which is attracting interest - If I overpay that then the debt will fly down as interest was applied at the beginning of the loan.

The reason for rounding up is to give me more impetus - but I guess what you are saying is to get a true reflection you need a true figure, which I have, but I want my goal to be the 100k!

The mortgage is only at 24k, but lets see how far I can get with the debts and the goal of the 100k. 

Like your idea of the 90/10 split, but as the main wage earner I think I need to go more 70/30 in favour of the EF, then maintain all my payments and overpay the highest interest.

What I am going to do is sell stuff first. I'm looking at batch cooking and how to reduce what I spend. 

NB: I dont get a salary, I am a contractor. I earn different amounts each month, and also why the EF is totally vital. I currently have just over 2k -but that's not tucked away, as I dont know exactly what I will need, so I will use that as a float and move on with what new gets paid in (I can have heavy travel costs etc)  so I need to budget and define what I need for the next month and I have another invoice due to be paid next Wednesday - but these things dont always work out how we want them to!

Debt paid 0 / 94831  Emergency Fund 0/5000

Skint_but_Optimistic

Debt paid 0 / 94831.00  Emergency Fund 81.00/5000

Look at me with 81 pounds in the emergency fund (hope its a minor emergency) . After maintaining my travel float and a couple of trips to London to be recouped with expenses, I have managed the grand total of 81 pounds. Back to school costs of 150 pounds (School uniform, a joke, its versache prices - and we were waiting of the school branded PE kit hope hes doing PE every other day tbh)  and a ridiculous amount of birthdays  - 6 in the family amounting to 200 pounds ish, I became depleted. 

Due to work and travel only one batch cook has been done, and with dispatching DD to university no selling has been done yet.

I will keep my resolve and as the bills are due to be paid I am hoping for a cascade of payments made which will reduce the balance so I have some traction.

Skint_but_Optimistic

Debt paid 0 / 94831.00  Emergency Fund 111.86 /5000

Sold a couple of items on a facebook selling group- its good to declutter and add to that fund. 

Toonie

I wish you luck on your journey. I'm about to start a declutter of my house too as I'm currently out of work and have a leg injury (just started my own diary too).

I'm aiming to do little bits room by room and designate as items to sell, items to charity, items to rubbish pile.

EssexHebridean

I'd definitely second the advice to do an SOA - even if just focusing on the outgoings you currently have, if your income fluctuates, quite often the regulars on here can spot savings on bills etc that would be possible but that you may have missed, it can be a really worthwhile exercise. 

Rounding up *can* be dangerous, but less so in your circumstances. The thing definitely NOT to do though is round up/down the amounts you have going out on your budget or SOA - try to account for every last penny. 

Skint_but_Optimistic

Debt paid 687.00 / 94831.00  Emergency Fund 181.86 /5000

I will do a SOA - as soon as possible. Just wanted to update my totals!

Skint_but_Optimistic

Debt paid 687.00 / 94831.00  Emergency Fund 181.86 /5000

Collecting info for the SOA and have listed some stuff on Vinted at the weekend plus filled a bag for the charity shop. 

Skint_but_Optimistic

Debt paid 1186.00 / 94831.00  Emergency Fund 181.86 /5000

updated totals