100 Small Steps...

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I have been in debt my whole adult life. Just generally being silly in my 20s, going on holidays and over spending without a single thought of saving a penny! At it's highest point it was around 21k and this was at at time when I was barely earning anything as I was studying and only working part time. I worked hard to always pay the minimum payments. I dreamt of the days when I would qualify and earn a decent-ish wage.

I am now in this position and have halved my debt to just under 10k. I found the best method for me is by making small daily payments and this is what I did last year in lockdown, it was very motivating seeing my balances go down daily and closing accounts for good. However, I have become complacement and this year has kind of slowed down and I have noticed my spending has started to creep up again. 

The debt is made up on a Tesco loan (less than 2k left and its due to be paid off by June 2022), Barclaycard CC (£6400 interest free), Natwest CC (around £650 with interest so this one needs to go first), and an online Next account with around £400 on it (this will be 2nd to go). 

I do have some savings in a H2B ISA (£6700) and I know it is counterproductive to have savings when you have debt, however I feel like mentally for me, I need to know I have some savings for a house. At the minute, I just see this as a bill and only pay £200 per month via direct debit into this and I forget about it. Once my debt is paid I can plough lots more into another savings account to top this up - I can't wait for that day to come! 

So my plan is to get back to making my small payments per day as this is what works for me. I also like the idea of a 100 square visual tracker by paying 1% at a time. My 1% is £100. Obviously I don't have £100 spare every day so I have set up a Monzo pot for my daily payments and once it hits £100 I will make my 1% payment and repeat. With my wages from September I have paid the first 5% off, only 95% left... 

Let's go :)

Comments

  • Doris17
    Doris17 Posts: 678 Forumite
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    I have also been in debt most of my adult life, fingers crossed by the end of next 2022 I will be debt free. I am also struggling with have a small amount of saving and debt.

    Look forward to following your journey.

    "Make Everyday Count"

    #77 3-6 Months Emergency Fund £2528.11/£5000

  • enthusiasticsaver
    enthusiasticsaver Posts: 15,664 Ambassador
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    I agree that tackling the interest bearing debt first is the way to go and I strongly recommend closing down that Next and Nat West card down if you will be tempted to spend on it again.

    I would look at the debt as a bill also and work out how much you can afford to pay each month and pay it off once you get paid and resolve not to use credit at all. Obviously extra payments are good but having emergency savings is also important especially if you have a car or pets which are usually things which cost and people are tempted to put on credit if they have a large bill for these things. 
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  • Eloise06
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    Doris17 said:
    I have also been in debt most of my adult life, fingers crossed by the end of next 2022 I will be debt free. I am also struggling with have a small amount of saving and debt.

    Look forward to following your journey.
    Hi Doris,

    Thank you for your reply...

    It would be great to be debt free by 2022, it will soon come around! 

    I will be following your journey also :):smiley:

  • Eloise06
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    I agree that tackling the interest bearing debt first is the way to go and I strongly recommend closing down that Next and Nat West card down if you will be tempted to spend on it again.

    I would look at the debt as a bill also and work out how much you can afford to pay each month and pay it off once you get paid and resolve not to use credit at all. Obviously extra payments are good but having emergency savings is also important especially if you have a car or pets which are usually things which cost and people are tempted to put on credit if they have a large bill for these things. 
    Hello enthusiastic saver, and thank you for your advice :):smile:

    I agree about closing the Next and CC as I do keep repeat spending on them. I also need to set up an Emergency Fund, I will set this up on pay day. Eventually I would like to be more organised and have sinking funds for a few areas.
  • Eloise06
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    Since my first post, I have been putting away daily payments of varying amounts in my 1% Monzo pot and have £63 so far. Hopefully by the end of the weekend it will reach £100 and I can pay another 1% off! I am on night shift all weekend (4 loooong nights :s ) so it makes it easier not to spend any money. 
  • Eloise06
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    Another NSD for me today - benefit of being on night shift! So that's another £14.75 put into the Monzo pot (currently at £78). Not bad for a week of savings, hopefully by Monday night I'll be paying the 1% off debt 
  • Doris17
    Doris17 Posts: 678 Forumite
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    Well done, you are doing great.

    "Make Everyday Count"

    #77 3-6 Months Emergency Fund £2528.11/£5000

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