Dreaming of being Debt Free

MFWannabe

Debt_Smashing said:

Unsure what to do now, try to get an emergency fund going again, attack the student loan or the other big loan. Or whether to actually spend some money on myself for a change.

Personally I’d build up the emergency fund again  while still allowing myself some small treats
EF is important ad it stops you turning to cards if something goes wrong 

Debt_Smashing

Cheers.
Building up the emergency fund should be first priority, I'm just so burnt out from having all this debt and for so long. The slog is real. And I honestly thought I'd feel better as it goes down, like a weight lifted from me. But I don't feel nothing.
And no, I am NEVER gonna turn to CC again, im gonna go without rather than doing that again.

joedenise

Agree you need to build an Emergency Fund again so that you never need to turn to CC again.  If you haven't got an EF and there's an emergency spend what would you do - use a CC which you say you don't ever want to do so you've really answered your own question!

twiggy86

I've been around a few times (apparently didn't learn my lesson and never managed to clear all the debt!!) - this is the first time I built up an emergency fund as my first priority and I regret not doing it sooner. The mental peace it brings is worth a little while longer being in debt in my opinion! 

MFWannabe

Plus you can get higher interest rate on savings than your loan is 

Debt_Smashing

No, honestly, not using a CC again. Last time I spend on one was over at least 5 years ago. All this debt is from paying off OH debts with where on silly APRs.
But what would I do in an emergency? I have an £1000 overdraft, half of which is interest free is there.
The emergency fund I did have, got completely blown on a new car when the last one died, which was good to have.
What sort of number do you think would be a good start? £1000 again for a starter emergency fund?

MFWannabe

I think you should have a £1000 emergency fund, that normally covers most things that can go wrong, white goods, car problems etc. 
Also if you put it into a high interest easy access account you’ll make circa 5%interest 
How long would it take you to build up emergency fund? 

Also your gas and electric seems very high? Are you in debt on your account or just not looked at it? Is that actually how much you spend? 

Debt_Smashing

It would take a few months to build it up I would imagine. 4 would be realistic, but with the summer holidays around the corner, maybe longer.
And the gas and electric is on a direct debit, averaged out over 12 months. Not in debt either. Why does this seem excessive? 2 adults and 2 children.

MFWannabe

Seems really high to me. Are you in credit? How does your direct debit compare to your actual bills? 

We’re 2 adults in a 2 bed semi and ours is half that amount 
Would be good to hear others thoughts on this? 🤔

joedenise

I thought your gas/electricity was high but it really depends on how big your property is rather than the number of people in it although that does make some difference.

We currently pay just over £90 a month in a 3/4 bed bungalow with just 2 of us living in it and had a refund of £200 a few months ago as we were in quite a bit of credit.  Since then we have rebuilt just over £150 credit so definitely worth seeing if you really need to be paying as much.

It's also a good idea to encourage everyone to turn off electronic gadgets; TVs etc rather than leaving them in Standby mode.  Perhaps cut down on the length of time everyone spends in the shower or has a shallow bath if that's what you have.

Batch cooking and freezing in portions can also reduce electric/gas use as it uses the same amount to make a big pot of curry, stew etc as it does for a small pan, especially if you use a slow cooker or a pressure cooker.  Reheating can be done easily in the microwave and just need to cook a carb to go with it.