Head Up, Keep Positive, Eye on the Prize

ThisLife

Stats when I first started to debt bust in July 2017 - 

credit card 1 - £1,273
credit card 2 - £4,157
credit card 3 - £5,140
credit card 4 - £5,157
credit card 5 - £9,062
credit card 6 - £9,464
loan - £7,749

Total - £42,002.97
Just my minimum payments for this debt was £889 for the month. My mortgage, with the two consolidations (for previous debt) was £750 and then there were the normal household bills on top.

Once I finally started to think about it, I couldn't stop. I had known my numbers years before and kept track every month so that final number wasn't a surprise, but never THOUGHT about it or tracked it forward into the future. I felt sick at how tight it had all become. Absolutely no room for manoeuvre, no savings (work pension, but no available cash at all) and any emergency would have had to go on credit and given I had no spare money after paying all bills/debt, it could have got very bad. 

Previously, I had tried to cut down. Some of my plans were:
Only buy fuel on credit card
Only buy food on credit card
Only buy household bits on credit card

None of them worked. It's different fo everyone, but for me, the only traction I got was when I stopped using credit cards completely. It meant that I had a starting point that wasn't going to fluctuate up and down, it could only go down because of the payments I was making. I saved up an emergency fund of £1000, funded wholly by trawling the house and selling anything lying around not being used. Including lots of clothes too small for me that I had aimed to get back into. I decided that I needed the money now and when I needed to get clothes in the future, various auction sites were full of them. Then I started on the debt.

I don't think credit or credit cards are evil. I will still keep 2 once all this is finished. I used one to money transfer last year to buy a car. It was planned though and I know what that money was used for. I'm probably still paying off stuff I bought in Boots 10 years ago, umpteen take aways long forgotten and so many other bits and pieces - crazy! 

Stats now - 

card 1 - £6,165
card 2 - £2,630
card 3 - £13,664.19 (most of this is the car)

Total - £22,459.19 (minimum payments are now £312.92)

Sorry for anyone reading if some of this is a repeat. It's for me really. I need to NEVER forget that sick feeling of panic I felt at the start. The dread at the journey ahead. The disgust at ever having allowed myself to get to that position in the first place.

... and the even deeper dread of ever having to reveal the true amount of my debt to my lovely partner at the time, if it ever went the distance (it did!)

Got to keep my eye on the prize!

ThisLife

So we have £47.24 left for fuel and food until the 25th. We're going to have to go into the emergency fund for the rest of the month, which is already down to £700 from £1000 because of Christmas.

We weren't as prepared as we should've been and actually a lot of the January money was already spent by the time January arrived! I had to transfer from the emergency fund and empty some pots.

We will do better next year and Mr TL has already set up a spreadsheet for all birthdays and Christmas. We have yet to enter the estimated spends for each person and then work out how much we need to save each month to cover it. 

Going shopping in a minute with a list and the calculator on my phone to keep with in the £47.24.

ThisLife

£31.53 spent so £15.71 left. We should be ok for the rest of the week now as food and fuel are sorted. We have built up £10 on our loyalty card for the butcher and we have a £20 gift card for the local cheese shop, so we can use those next weekend. 

A survey just popped up which I did. £0.24 ... it all adds up   

Think the cheese shop now sells other things too. Much as I love cheese, eating £20 of it in a week might not be a good idea!

ThisLife

I'd really love to be debt free by April 2024, 28 months (doesn't seem vey long when it's written like that!) That would mean paying £800 in repayments each month. I'm paying around £500 per month at the moment, so I'd need to find a chunk more. 

I have become more slack though, so I need to tighten up spending and look at ways of earning more. Doable, I think, if I really focus on it.

I'll do an update at the end of each month.

bigbeff

Good luck in your journey. I'm just starting out with organising my finances.... so hard when in bad habits! 

I like the prolific academic idea - I do them sporadically, I might aim for similar each month. Every penny counts right? I'm currently decluttering as moving in with my partner. Struggling to know where to start. I'll subscribe Look forward to hearing about your journey. 

ThisLife

bigbeff said:

Good luck in your journey. I'm just starting out with organising my finances.... so hard when in bad habits! 

I like the prolific academic idea - I do them sporadically, I might aim for similar each month. Every penny counts right? I'm currently decluttering as moving in with my partner. Struggling to know where to start. I'll subscribe Look forward to hearing about your journey. 

It's so hard to get out of bad habits. Before I started I never used to budget, just spent what I wanted each month, paid a bit off the cards each month, then balance transferred if I ran out of room ... and the cycle continued. 

Dave Ramsey was a game changer for me. Very opinionated, but really good steps to follow. He's a bit marmite, you'll love or hate him  I always budget now, it's unthinkable to not to. For my monthly budget I use an app called Fudget. I really like it and have used it for years now.

With decluttering, I've read some good advice on here. It's hard to try to do it all at once, so some people set targets for themselves. 5 items on Ebay per week, a certain amount to the tip each week. 

Good luck and thanks for following, it's good to have the company of like minded people on this journey 

ThisLife

Mr TL's car is in the garage. Just heard it will be £310 (Service & MOT & various bits) We have £225 in the pot for car expenses, so another £100 will have to come out of the emergency fund, taking it to £600.

Really need to get the right amount going into each of the pots so this doesn't happen and there is enough when needed.

Will need to take some more out of the emergency pot before the end of the month too, as we have £15.71 left until the 25th. Not feeling good to be doing this as it's not really being used for it's intended purpose - emergencies. Hey ho, I'll live and learn.

I feel a spreadsheet coming on 

bigbeff

Thanks for the advice, I'll take a look at that app  

And don't kick yourself too hard about unexpected expenses. If you didn't have the car pot, that would be £310 out of your emergency pot... so you are doing ok! 

ThisLife

bigbeff said:

Thanks for the advice, I'll take a look at that app  

And don't kick yourself too hard about unexpected expenses. If you didn't have the car pot, that would be £310 out of your emergency pot... so you are doing ok! 

Thankyou, you are right. What I need to take from this is to be better prepared for Christmas next year. 

ThisLife

In addition to the debt I have mentioned, there is one more card on my radar which I have not included in my personal debt total. We got married last year and even though we saved up a chunk for it, it still wasn't going to be enough, so we took out a 0% purchase card. 

I know I said I hadn't spent on credit cards since I started in July 2017, but in my head this is in it's own little bubble, for a specific purpose. I want to be honest here too and not hide things related to getting debt free. So as far as using credit since 2017 its just this card and the money transfer for the car. 

It's in my name, but we are both paying towards it each month. I'm not including it in my total, but still need to manage it going forward. Henceforth to be called The Wedding Card 

No regret at all, it was amazing and totally worth the extra expense after these last 2 years. We were able to spend time with our families and just looking at the pictures brings all those memories back to me. 

The 0% deal on The Wedding Card ends in March and so I'm looking around to see where to transfer the £6,600 to when it does. One of my other cards ends its deal in June, so need to think about that too. I have a couple of cards with no balance, so just checking for any deals there. 

I will be heartily glad when I no longer need to do the credit card shuffle! It is at least 2 years in the future, but (hopefully) that time will come anyway and we will be in a much better position going into the future.