20K to Debt Free by June - Finally Debt Free 27/06/23

LeeXenon

DECEMBER 2022 UPDATE - £10,551.67 DEBT PAID
Previously 20K to Debt Free by 2024 (Month 13/24)
Now 20K to Debt Free by June 2023 (Month 13/19)

I've come to realise that it's been a full 12-months since I commenced my debt-free diary.
I've decided for that reason to write up a bit of a comparison / progress report based on where I was 12 months ago, here it is in summary;

CC1 Was £3,916.58 - Now £530 (£3,386.58 Paid)

CC2 Was £7,352.29 - Now £4,140 (£3,212.29 Paid)

HP Was £9,655.98 -  Now £5,703.18 (£3,952.8 Paid)

Overall then: £20,897.85, Overall now: £10,373.18.

All in all, since 12 months ago I have paid off £10,551.67 worth of personal debt. (Average: £879/mo, or £22/day)

I'm extremely proud of myself for this achievement, and I would have been nowhere near where I am now if I kept making the measly £100 PCM payments for each card. I'm not sure where in my head I decided that was OK, because it certainly was not.

Original Post (Outdated Strategy)

Hello everyone,
I've decided to make this post for accountability.

I've been secretly dealing with debt for the past 10+ years - I don't have any great excuse for the debt, it started with a holiday, then buying a house which then had a multitude of issues that required a new boiler, roof repair and roof replacement on the conservatory. Stupidly I also used credit for some initial home improvements on top of the repairs.

My situation at the moment; I work in the emergency services as a frontline worker, we now have a baby boy who's nearly 1 and me and SO can NOT afford childcare at the moment. Our bills are paid and we have a bit of money left over every month purely for leisure (Usually ~£200 give or take, the majority of which gets spent on takeaway or eating out - Big oof!)

My lines of credit as of 04/12/21 include;

MBNA	£  3,916.58	/ £  9,050
Virgin	£  7,352.29	/ £  8,500
Car (HP)	£  9,655.98	/ £  20,196

My biggest debt is my car, due to be paid off in April 2024.

Once the vehicle is cleared, I will then clear my other lines of credit using increased payments.

Once the credit is cleared, I will save and take my family on holiday as a reward.

As it stands I have 28 payments left on the car, that are £329.40 per month with an APR around 7% - I've done the math and taking a loan with a lower APR seems to work out the same for some reason (Perhaps due to fees?), so I'm going to roll with it. Once the car is cleared, I will increase my monthly payments on the MBNA and Virgin credit cards, both of which are currently 0% balance transfers and will need switching over again between the end of 2022 and mid 2023. In April 2024, I estimate the vehicle will have between 60,000 - 70,000 miles on the clock (I put around 10K a year on it), which in theory should mean it has quite a bit of life left in it before I have to think about a new car, but definitely enough time to clear my debt!

Strategy for clearing CC debt
The monthly payments for the car will stand and expire on April 2024 as planned, I do not intend to make additional payments here. Up until now I've been making payments of £100 PCM on both cards (albeit I cleared out another card in the past few months). I will now make payments of £150PCM (or £175 if I'm feeling good) on both credit cards, meaning my total debt payments PCM are £624.90 (Wowza!). That's £625 I could have every month for spending on myself, my partner and my son!

Once the vehicle is paid off in April 2024
MBNA will be cleared
Virgin balance will be 

£  3,152.29 Virgin is now my only line of credit, time to clear it with payments of £650 PCM - The final burn will take 5 months. Plan followed intricately, I should be debt free by SEPTEMBER 2024.

I will make extra payments along the way, with a less realistic goal of clearing debt by April 2024 in timing with the car payments, watch this space.

Update as of 4th December
Declined an increased credit limit offered by Virgin, of £12,900 from £8,500. Yes, utilization is high at the moment which is a bit of a mark on the credit report, however by the time the balance transfer offer is up I should be good to go. My rationale for declining the credit increase of £4,400 is that the £4,400 may be credit offered by another lender when I require a balance transfer, they may be reluctant if I have too much spare credit.

28 Month Oath
- I will not use any credit card for spending including in an emergency unless reserves are depleted.
- I will set aside a fixed amount per month for leisure/food, what doesn't get spent goes into savings.
- The absolute minimum payment is £150 per month on each CC.

TheAble

Sounds a reasonable plan. It's a lot of mileage you're doing though, must be costing you a fortune. Do you need to do 10k/yr?

LeeXenon

TheAble said:

Sounds a reasonable plan. It's a lot of mileage you're doing though, must be costing you a fortune. Do you need to do 10k/yr?

Sadly yes, a round trip to see family members is about 80 miles, combined with 24 miles daily for work. Fuel is approx £90/mo on a good month.

LeeXenon

Well thought I'd post an update a few months on.
MBNA stands at £3,550.
Virgin £7,000.
HP £8,997.18

Between 4th December and 18th February I've cleared £1,377.67 of the debt (~6%). That's a shameful amount of money and a big eye opener as to a lesson learnt. Still, it's a little bit of a long way to go.

As things stand I felt as though I overspent a bit in January, perhaps was just feeling the effects from Christmas spending which was as minimal as could be. February so far I'm feeling slightly better, mental-wise I definitely feel more stable.

Further updates to come.

Amber1980

Hi there,just dropping by to wish you well and say I also spent too much in January when I really wasn’t meant to be! And I also definitely spend more when I’m not feeling great mentally.At least we can acknowledge that,and every day can be a fresh start,I’m going to try and really get back on to minimal spending and regain control,my problem is if I get bored or stressed I think a new top is the solution!
I aim to make March a self care month and do a ten minute meditation each evening,hope you have a good weekend!😊

LeeXenon

Amber1980 said:

Hi there,just dropping by to wish you well and say I also spent too much in January when I really wasn’t meant to be! And I also definitely spend more when I’m not feeling great mentally.At least we can acknowledge that,and every day can be a fresh start,I’m going to try and really get back on to minimal spending and regain control,my problem is if I get bored or stressed I think a new top is the solution!
I aim to make March a self care month and do a ten minute meditation each evening,hope you have a good weekend!😊

Appreciate the good vibes and I hope you are doing well!
Just updating to the effect that I've cleared another £679.40 this month, remaining;

MBNA £3,375 /  £3,916.58
Virgin: £6,825 / £7,352.29
HP: £8,667.78 / £9,655.98

Since creating the post, I've cleared £2,057.07 of the debt, which is just shy of 10%.
Hoping to get some overtime in this month and pay off a little more, the hard work continues.

[Deleted User]

LeeXenon said:

Amber1980 said:

Hi there,just dropping by to wish you well and say I also spent too much in January when I really wasn’t meant to be! And I also definitely spend more when I’m not feeling great mentally.At least we can acknowledge that,and every day can be a fresh start,I’m going to try and really get back on to minimal spending and regain control,my problem is if I get bored or stressed I think a new top is the solution!
I aim to make March a self care month and do a ten minute meditation each evening,hope you have a good weekend!😊

Appreciate the good vibes and I hope you are doing well!
Just updating to the effect that I've cleared another £679.40 this month, remaining;

MBNA £3,375 /  £3,916.58
Virgin: £6,825 / £7,352.29
HP: £8,667.78 / £9,655.98

Since creating the post, I've cleared £2,057.07 of the debt, which is just shy of 10%.
Hoping to get some overtime in this month and pay off a little more, the hard work continues.

This is amazing! I've just caught up on your diary and I'm feeling very motivated. Keep going

Aaleigha

You are doing well 
The hardest bit is the starting 
As you see progress you want more so you fight a little harder etc 

Good luck with your continuing journey 
Will be here to help if I can 
I have booked this thread

LittleMissDetermined

Popping in to subscribe and cheer you on, you've already cleared quite a chunk of your debt! Just under 10% if my maths is correct
LMD x

LeeXenon

Thanks for the support to everyone who started following along, it's nice to get chatting to some of you.
It's almost that time where the bills come out and the CC's get paid so there's not really any room for spending being paid monthly!

One of the things I've been looking to do to save some money is a self-phone repair, I already completed this on my 4 year old Samsung watch last month which was a success, my Samsung phone is starting to show signs of battery fatigue so I'm getting ready to disassemble and replace some components.

A new back cover, fingerprint sensor and battery would cost no more than £28 from a reputable outlet with OEM parts, thankfully I have a heat gun and some tools that would help in the disassembly, it should have the phone looking and feeling like new afterwards! I don't think it's quite at the point it *Needs* doing though, so I'm holding off for now, but this is most certainly more sensible than buying a new phone simply because mine's "getting old". It probably needs to be plugged in during the day for half an hour to an hour to stay switched on for the day, I'll keep doing that for now before rushing to do any repair.

LittleMissDetermined

My hubby once replaced his iPhone battery for less than £10 and some time spent on YouTube, if you can do it yourself it’ll save you money. I’d do the same for now though, just top it up mid-day to keep it going