Taking charge of debt

sunshine_raincloud

Hello. I just wanted to start this diary to be held accountable on my debt journey! I have lurked on the forum for a while and found so many helpful tips here (thank you everyone!), which I have been starting to put into action. My main issues have just been ridiculous spending, which has to STOP. I'm looking towards the future and I want to find myself in a secure and stable position, out of debt and with an adequate emergency fund so I don't end up back into debt when life throws something at me! 

Debt situation Jan 2022 at LBM

CC1 £1433 (0%)
CC2 £4160 (0%)
CC3 £1800 (0%)

Total £7393

I have already managed to get this down over last month or so 

So currently 

CC1 £1226
CC2 £4160
CC3 £850

Total £6236

Steps so far:
- reduced my phone bill, cancelled tv packages, invested in travel cards that will be cheaper in long run, deleted uber app from my phone
- set up spreadsheet
- set up 'round ups' to savings account from current account 
- started to 'tilly tidy' every day where I can (to go towards debt) and set up my own 365 day 1p challenge spreadsheet (to go towards EF) as well as working out my 1% debt amount (£74) and getting chart to tick off each 1% I pay off (all of this is very motivating!) 
- had 5 NSDs this month (last month I didn't even know what a NSD was!) 

Aims for the future 
- pay off ALL debt by end of the year 
- create £1000 EF 

Ambitious but potentially doable if I maintain focus. 

I am planning on tackling CC1 first due to earliest end of 0% then CC3 and finally the biggie CC2. 

After all these big changes just hoping I can stick to them. 

Thanks 

Amber1980

Hi,sounds like you have a good,achieveable plan in place and you’re feeling motivated,good luck!
Sticking to it is the hardest part but it will feel great when you get there!😊

sunshine_raincloud

Hi Amber. Thanks for the support! Absolutely I think sticking to the plan is always the hardest part. I don't think I have ever managed to stick to any budget I have made but determined this time will be different hence the diary! 

londoner2019

Good luck on your journey!

The 1% chart is a great motivator, and the diary and the spreadsheet really help to keep you both honest and fully aware of where you are at. Try updating the spreadsheet daily, or at least three times a week. If you have not looked in a while, always face the music! It’s much easier to revisit after a week, rather than a month.

sunshine_raincloud

Thanks for the words of encouragement! 

At the minute I am slightly obsessing over spreadsheet on a daily basis but I know there will be days I end up missing. Think I am going to aim for every other day minimum to keep on top of things. 

Payday at the end of the week, which I am looking forward to not because I want to spend the money but I'm excited to divide it up into my pots and get rid of some more debt! Next month will be the first month I have been in MSE mindset from the beginning of the month so I'm intrigued to see how much of my spending I can curb. I have one weekend away with friends planned and one work trip but I am going to set a budget for both of these and try to balance them out with some NSDs and living off cupboard food for rest of the time. 

Let's see how it goes!

sunshine_raincloud

Feel like I have fallen at the final hurdle today! The week had been going well and I was feeling good moving small amounts of money around to pay for debts instead of sitting in my bank account with the promise of payday on Friday. Went out for lunch with a friend today who forgot her debit card so obviously I offered to pay for the both of us but this has now taken me back into my overdraft! Lesson learned to always keep back a bit of money so I'm not living so close to the zero bank balance line. I know it isn't a huge set back and I will be back out of my overdraft again on Friday but it feels like I have undone all my good work from the last couple of weeks. I will make a more concrete budget for next month and hopefully stick to it!

foxgloves

@sunshine_raincloud, Yes, as you've discovered, it's important to work in a realistic buffer zone when you set your budget each month. There can be unexpected expenses like your friend forgetting her debit card, but also however carefully I budget, I do sometimes find a little error in my calculations, something costs a bit more than I thought or I occasionally forget something. I'm normally pretty accurate, but knowing I've left a buffer zone to absorb any of the above before things get anywhere near the overdraft stage always gives me a sense of security. I had an overdraft from the age of 19 until well into my early 40s - no dramas, just silly overspending & general frittering, which I've been very honest about in my own diary, & I have no intention of slipping into overdraft again...... but my planned-in buffer zone has helped with this over the (reformed!) years.
Good luck with your debt-busting.
F

sunshine_raincloud

@foxgloves yep definite lesson learned. But also lucky I hadn't completely got rid of my overdraft otherwise we might both still be there now washing pots!  silly overspending and general frittering is completely my situation as well. Will have a look through your diary for inspiration.. thanks for the advice! 

FootyFanDan

I used to struggle with this too, I would do all my budget then other things I would forget or slightly overspend and it would then throw me off course. I ended up just factoring in a buffer to my budget and budgeting for it, so when I did overspend that buffer covered it. At month end whatever was left in the buffer fund would then get paid off debt.

It does seem like you have a good plan in place that is achievable. Good luck  

pelirocco

sunshine_raincloud said:

Feel like I have fallen at the final hurdle today! The week had been going well and I was feeling good moving small amounts of money around to pay for debts instead of sitting in my bank account with the promise of payday on Friday. Went out for lunch with a friend today who forgot her debit card so obviously I offered to pay for the both of us but this has now taken me back into my overdraft! Lesson learned to always keep back a bit of money so I'm not living so close to the zero bank balance line. I know it isn't a huge set back and I will be back out of my overdraft again on Friday but it feels like I have undone all my good work from the last couple of weeks. I will make a more concrete budget for next month and hopefully stick to it!

I hope she has offered to repay you ?
And isn't one of those friends who makes a habit of this

sunshine_raincloud

Payday! Previously this would have been an excuse to splash out and treat myself to something but this morning I have been more excited to get my accounts in order after the accidental dip back into my overdraft. Spending money on monzo split into nice pots and done a small payment to CC1 and transferred huge 55p to my emergency fund   

I'm going to leave my bank account fairly quiet this month to see how much I actually end up having in there at the end, hopefully to get a bit of a buffer going as suggested by everyone here. So no dramatic extra pay offs other than those budgeted for but I will keep going with tilly tidying. 

I am going to visit some friends for the weekend so this has potential to spiral into a spending disaster but I am approaching it with a completely different mindset and for the first time in my life a budget so fingers crossed I stick to it!