Struggling to stay out of debt

Glittermouse

Hi EssexHebridean,
Sorry I didn’t get back to you sooner. I’ve been working extra hours and tired.

Thank you very much for your advice and sharing a bit of your issues. I am crap at maths too but I can add up. I buried my head in the sand for years and eventually told my mum. What I don’t tell her is about any debt since. 

Bank account wise I have an e savings account attached and use it for my dogs health plan and insurance as it comes out later in the month. I also have an account with my local credit union which is very underused. The good thing about it is that I have to physically go to get money out. I do need to crack budgeting. I have a book with my debt in the back so I track those am actively paying off and the rest I manage. Every month I write down my bills, how much I’m paying for each, then how much have payed out, what my wages are and then how much I have for the month. That’s as far as I go organised budgeting wise. 

I really like your ideas and thinking time is good although I think a change of mindset too. The longer I think about something, in some cases, I want whatever it is more. It going to be something I work hard at it.

Thank you so much for the advice. 

TripleH

Ultimately it comes down to knowing how much you spend and what you buy.

It might be worth looking over historical spending to get an accurate picture.

Also look at waste, if you throw a lot away (food, books etc) this is an area that can be addressed.

Little things like books, are they all brand new or do you go to charity shops? If a prolific reader of anything, better to buy second hand books and only new if it is something 'very specific' you need for reference in the future.

If you have a computer or phone, spreadsheets can be better than paper especially when pulling data together. If having a paper copy really helps you, that's fine but do it after you get a finalised version from a spreadsheet. It saves a lot of time.

When walking the dogs, take a thermos / packed lunch and make a full day of it for free or travel costs only soon adds up.

Sweets, again maybe take some with you for the day to avoid buying when out. Don't buy in bulk if you have a sweet tooth and little willpower, this is a false economy.

Sea_Shell

On the notebook theme...

I save A4 junk mail (or mail that's been scanned) with blank backs, cut them in half and make notepads, admittedly mainly for jotting stuff down.

They still get shredded before being binned.

I'm also a sucker for stationery!!

On recently clearing a filing cabinet I found a stash of A4 spiral bound pads which I'm determined to use up before ever buying another sheet of paper!!

Andyjflet

For me it was over 2 years ago, I found Dave Ramsey, I live to his Baby Steps and will be consumer debt free by the end of the year. It has changed my life, I'm not intense about it but I'm much better off, haven't used a credit facility for over 2 years. 

london21

Do not be so hard on yourself.

I find that spending cash rather than card, I am more aware of what I am spending.

Take baby steps forward, try not to constantly blame yourself, once you know better you will do better.

Earn more or spend less, can you develop a skill or go into a new career?

Decide what you need and what you want and then is it within affordability.

I do not get distracted by what other people have, social media can be a sales place a lot of people look rich but could be drowning in debt.

Mindset change, try not to be overly negative take baby steps exercise, save money having home cooked meals instead of takeaways etc.

Things can and will get better.

666666

I'm also not that great at managing finances and even though I don't have debts I used to not able to save money when I was young. The one thing I did that changed everything for me was to work out my budget for the month then anything extra I take out via direct debit the day when my pay comes in and put it into long term saving account that would be a pain to transfer back. Like a 3 months term deposit or just any account that would require you to do multiple annoying steps to withdraw (I put mine into an account that I don't have the bank card for it or online banking so I would have to literally call etc back in the day to transfer that money back into my day to day account if I want to use it). When you do your budget you also have to be realistic and don't restrict yourself too much that would make your life unbearable so that you can keep the habit up for a long period of time. If you can't easily touch it and don't see it because it goes to your "untouchable" account straight away, you will not be tempted to spend it. Better yet, don't look at that saving account balance and just forget about it while keep putting 100 pounds or whatever money you can afford to put in there every month. Every year also re-asses whether you can put more into it or not and adjust your direct debit amount. 

peteuk

Dont think I can add to the great advice you've already got, however I would like to throw my support behind you. 

I had a DMP when I was single, Id brought a house and filled it with what i needed by paying on credit.   When I then meet my partner we got into another load of debt. So a second DMP was needed.  It would seem we (I) never really learned and although we paid things off, new debt was added but it was all manageable.  Although we didn't struggle, we weren't rich. 

It was really only during lockdown that I made the connection to debt and lifestyle.  So well done to you for having the guts to ask your question.  Must be something to do with being 40 odd.   My budget spread sheet now includes everything I spend money on. instead of only having the bills on it.   Its strange now, looking back at how I viewed my finances.

Anyway the only stupid question is the one you dont ask!  So thanks for posting, bringing this to peoples attention, I am sure that there are others out there who are in the same position.   Good luck with clearing your debts and staying out of debt.  

DrCarrie

Hi Glittermouse, 

I habe been in and out of debt since 2003, i never learned how to budget, to live in my means. I hope this time I will! Not that I am there yet. 

What I have found incredibly helpful in terms of budgeting is the 50/30/20 method of budgeting. It has rea;y opened y eye to what I want...and actually I can't have (without using a credit card). 

its supposed to be 
- 50% of gross income on - needs 
- 30% on 'wants' 
and 20% on saving / paying off debt 

Mine is actually 58% on needs (I mean i could reduce the food budget again...but right now I am not), 20% on wants / leisure (and this includes smoking which is going in July) and 22% on saving / debts. 

Somehow, the MSE spreadsheet never allowed me to see things as clearly as that!


Maybe a diary on here could help? 

Glittermouse

Hello Everyone,
Thank you all so much for the advice and sharing your own experiences. I’m sorry I haven’t responded quicker. Please do not think I am ignoring your help, I just get very tired and then forget to do stuff. Sorry.

This is a reply to everyone who has asked questions recently so TripleH you gave me some really interesting things to think about.

Historically, my spending pattern is pretty much the same - buying what I like. Music, books, stationary, naff food. 

You asked about the books. Second hand is definitely good but I work in a bookshop and have an extremely good discount. Plus I can apply for proof copies which don’t cost me anything financially. I am reading some books specifically for an art course I’m currently doing. They cost more but my discount does help. I am careful about what books I buy, there’s just so many good ones.

I use my mum’s laptop, because she doesn’t, and have recently cancelled my monthly Microsoft subscription which was costing me far more than I thought. Instead I bought it from Argos, one year personal subscription. Cheaper! 

I can definitely look at the food and save money by not buying absolute rubbish. 

Sea-shell - Making notebooks out of scrap paper for random notes is ace. And like you I found some notebooks that I haven’t used. 

As much as I love a good spreadsheet, if I do a daily budget/spending tracker with n a notebook I can take it with me.

Thank you Andyjflet, I forgot about Dave. I have heard of him but never investigated further. It’s brilliant to see it’s really helped you.

London21 - Thank you so much! This month I am working to a weekly budget, well trying to. And I took it out in cash which is so much better. 

I’ve thought about doing a side business but no real skills. I am learning art and enjoy writing so maybe there’s a freelance option there somewhere. Thanks for the idea!

Hey 666666, thank you very much. I do have a very under used credit union account which is not easy to access and there is no debit card for the account. So by sticking to a weekly budget, I really should start putting the money I don’t spend in that. I shall definitely do that!

Hello peteuk. Thank you so much for your reply and sharing your story. I think you have done a good thing too. It’s good to know I’m not alone. Thank you.

Hey DrCarrie. Thank you for sharing your story and like me you are trying and I think that’s what’s important. We are not alone and I so glad I posted here to find that out. Debt and struggling to manage money is such an embarrassing issue but the truth will out. Lots of people struggle, they just don’t admit it. You will do this, you will rule money and not let it rule you. You will be debt free. All of us will if we really want to be! 

So many people have talked about budgeting I’ve finally started it. Lets see how it goes. 

Thank you to everyone for taking the time to offer me advice or support or both. This is an amazing community. You didn’t go postal on me or treat me like I’m stupid. You have no idea how grateful I am for that. 

I’ve said a lot in this post but THANK YOU. 

And apologies for the long post. You might need a cup of tea/coffee and a g&t to read through it.

EssexHebridean

Nobody is stupid here - some people have less knowledge, and tools at their disposal to deal with their finances - and by that I mean everything from never having been taught about budgeting, to simply not knowing what the outcome of consistently spending beyond their means will be. A lot of folk arrive here almost never having been taught to remember that as well as a past (which you can't change, but you can learn from) and a present - which is a great time to make changes - you also have a future - and it will be a lot brighter if you can consider yourself in control of your own finances. 

The matter of buying books interested me. I do get that you have a good incentive - the discount - to buy through work, but that still only works if you work to a strict budget. Have you set yourself a monthly figure you are allowed to spend? And do you always check to make sure that the books you're interested in aren't available elsewhere for a much better price? I appreciate that working in a bookshop you probably don't feel too kindly towards the likes of Amazon who undercut the business so badly purely because of economy of scale, but there might sometimes be secondhand (preloved, if you prefer) options? Perhaps set yourself a percentage by which you can justify buying a book new from your shop rather than using an online retailer? So if your shop is 20% more expensive, fair enough, but if it's 50% more, then online it is, or you simply opt to pass on that particular book until you can find it preloved? 

Struggling to manage money really shouldn't be the embarrassing subject it is - especially when so many people have never been taught the skills they need to manage their finances well.