My long overdue journey to becoming debt free!!

MissPennySave

Thank you!  The loan is 10.9%, fairly high, but was a debt consolidation loan so a lot lower than the CC apr that I would have been paying.  My job is as secure as can be so that's something!  I have 3 banks accounts, one for household bills, one for food and petrol, and then the last one is my non essential discretionary spending.  I have just created 3 spaces in this account, one for Christmas, which will also be used for next year, one for an emergency fund and one for any debt overpayments so I can easily see where my money is going.  My partner has a savings account for the bigger emergencies which he manages so I don't need to worry about that for now.  I look forward to the future when I can also contribute to it!

shell16

Hi there MPS.

I have to say joining DFW forum was the best thing I could have done.  Try to visit here and join the challenges too, Im on the Payment a Day Challenge and sealed pot Challenge.  Visiting your diary, reading others for inspiration and challenges all keep you focussed, and you may just learn something new to help you too.

Get a budget in place, make sure you have looked over the last 3 months statements and use those costs to formulate your budget.  This way you have a much better picture of what you should be putting away.  Have you tried cash budgeting?  I moved my Grocery and Fuel to cash as I found I spent more on card than I would usually do, things have a habit of catching your eye otherwise

Get your EF in place too.  Thats a must!  Alot opt for £1000 but try a mini target of £500.  The amount of times I have used mine since starting my DF journey has been an absolute life saver where those costs would just have gone onto a CC.

Keep focussed, stay with the budget, it will take time to perfect.  Good Luck!
Shell x

MissPennySave

shell16 said:

Hi there MPS.

I have to say joining DFW forum was the best thing I could have done.  Try to visit here and join the challenges too, Im on the Payment a Day Challenge and sealed pot Challenge.  Visiting your diary, reading others for inspiration and challenges all keep you focussed, and you may just learn something new to help you too.

Get a budget in place, make sure you have looked over the last 3 months statements and use those costs to formulate your budget.  This way you have a much better picture of what you should be putting away.  Have you tried cash budgeting?  I moved my Grocery and Fuel to cash as I found I spent more on card than I would usually do, things have a habit of catching your eye otherwise

Get your EF in place too.  Thats a must!  Alot opt for £1000 but try a mini target of £500.  The amount of times I have used mine since starting my DF journey has been an absolute life saver where those costs would just have gone onto a CC.

Keep focussed, stay with the budget, it will take time to perfect.  Good Luck!
Shell x

Thank you, it's definitely keeping me focused, and accountable!  For instance today was supposed to be a NSD, but one of the presents I planned to buy had 20% off today only so I ended up spending £12, but it would have cost £15 if I'd have waited until tomorrow so that seemed like a no brainer!  So tomorrow will be my NSD instead.

Cash budget for shopping is a great idea!  Some weeks I do a home delivery and I find I definitely spend less doing it that way as I can see how much I am spending, and often go to my basket at the end and remove a load of unnecessary items I've added to my trolley!  But next time I go in store I will take cash and see how that goes    MPS.x

enthusiasticsaver

I prefer online shopping too as it takes away the impulsivity of buying food.  I menu plan at the same time and if over budget I will sometimes remove stuff I don't need.

The loan is a fairly high rate so any overpayments you can make there will reduce the overall cost of borrowing.  For future reference debt consolidation loans are the worst way of dealing with debt.  I appreciate it is probably a lower rate than the CC rates assuming you could not get any 0% balance transfer deals but essentially it has led to your debt figure being higher as you would have been forced to deal with it earlier if you did not consolidate by changing spending habits as you are doing now and paying down the debt rather than moving it around. 

MissPennySave

enthusiasticsaver said:

I prefer online shopping too as it takes away the impulsivity of buying food. I menu plan at the same time and if over budget I will sometimes remove stuff I don't need.

The loan is a fairly high rate so any overpayments you can make there will reduce the overall cost of borrowing. For future reference debt consolidation loans are the worst way of dealing with debt. I appreciate it is probably a lower rate than the CC rates assuming you could not get any 0% balance transfer deals but essentially it has led to your debt figure being higher as you would have been forced to deal with it earlier if you did not consolidate by changing spending habits as you are doing now and paying down the debt rather than moving it around. 

Wow that makes so much sense, I'd never looked at it like that before! Thank you. I'm in two minds what to do about the loan, but I had decided any overpayments were going to go towards this rather than any CCs so I'm glad I got that right. My two options I've been thinking about are waiting until I'm a year down the line to see whether I can refinance it to a better rate loan, or have enough available on a CC with a 0% offer and move it to there, keeping the monthly payments the same, my gut says the 2nd option is the better off the two, or maybe even a combination of the two, but obviously all dependent on available CC 0% offers available!

MissPennySave

Morning all.  Well I didn't quite manage a NSD yesterday as I had to pick up some dog food, but I think I can let that slide!! I also had a balance of £26 on my Next account which I'd forgotten about so I cleared that as well.  So although it wasn't a NSD it was a sensible spend day!! MPS.x

MissPennySave

After reading through some of the other posts on here, I've set up a burner account today to take advantage of the Nationwide £200 switch offer, if all goes to plan that will be a £200 overpayment on the loan!

I've also set up various spaces on my banking app with automatic payments, I've created the following:

• Christmas Fund
• Holiday Fund
• Emergency Fund (goal £500)
• School uniform/trips Fund
• Debt overpayment fund (I've set up round ups to this saving space)
• 2023 1p savings challenge fund (will be transferred to the debt overpayment fund at the end of the year)

I'm feeling positive today!

MPS.x

MissPennySave

Right, I just re-jigged my snowball spreadsheet as I hadn't included my loan in the first one, so in my 1st post my DF goal of the CCs was Feb 26, with a buffer of Apr 26, but the new combined overall goal is Sept 26, which knocks off 7 months from the loan term.  As before, I will give myself a buffer and say Dec 26 to be totally DF! So 4 years and 1 month!  Eeesh that sounds like a long time....but......

I CAN DO THIS!!!!!! 

MPS.x

enthusiasticsaver

MissPennySave said:

After reading through some of the other posts on here, I've set up a burner account today to take advantage of the Nationwide £200 switch offer, if all goes to plan that will be a £200 overpayment on the loan!

I've also set up various spaces on my banking app with automatic payments, I've created the following:

• Christmas Fund
• Holiday Fund
• Emergency Fund (goal £500)
• School uniform/trips Fund
• Debt overpayment fund (I've set up round ups to this saving space)
• 2023 1p savings challenge fund (will be transferred to the debt overpayment fund at the end of the year)

I'm feeling positive today!

MPS.x

That is a great start.  I would go with the second option re the loan.  Try and pay down as much as possible and maybe move to a 0% deal at some point if you can get a decent length.  Unfortunately due to the economic climate decent BT deals tend to become few and far between. 

MissPennySave

Morning all. Woke up to a nice surprise, I forgot I had a pair of sandals for sale on eBay, the listing just keeps renewing, anyway I woke up this morning to an email to say they'd sold for £12.60! Will transfer what's left after fees and postage to the debt overpayment pot

Did a couple of surveys this morning so my balance is up to £1.69, I will try and do a few more throughout the day as well.

Hoping to have a NSD today too 💪.

MPS.x