The Final Bite of the Cherry- Journey to Clear £66k

outoftheviciouscircle

I have been here so many times, but I am determined to make this the last. This is not my first diary but the other attempts haven't worked so I've gone for a shiny new one.

A bit of background.
I have been in and out of debt most of my adult life. I was doing well staying out of debt until this summer when we completed on our dream home. Basically in February a house we have always loved came onto the market. It required a lot of work but  we felt confident we could finish it with the equity we had from selling our home. We instantly got our house valued and before we knew it, it was up for sale and sold within a week. After what felt like an age we finally got the keys in August.
4 months later we are moved in, although it still not finished and have about £40k debt to go with it. The positives I'm taking from this are that we absolutely love our new home, everything is as we want it and it will not require any work for many years to come.

Another thing to be grateful for is that we are not struggling with any of the debt repayment but we are very aware of how quickly that could change in the current environment.
We are fortunate that we are still on a cheap energy fix until August 23. With the £66 government support, we are only currently paying £26 a month for gas and electric and have over £600 in credit. I am keen to keep the credit building up so we have that cushion for next winter when we will not have the luxury of cheap energy.
Our mortgage deal also ends next December so we need to plan that our mortgage repayments may also go up.

The plan is to go after this debt as much as we can for the next 12 months so that, we have more disposable income by the time our mortgage and energy costs increase. I must also add that all of this debt is at 0%. 10k of it is spread over 2 credit cards that are fixed at 0% until April 2024 so we will throw it all at this first. The rest is 0% interest free credit, so will stay that way and 10k is a loan from my father in law that he hasn't charged us interest on.

I hope to complete an SOA in the next few days, I have a funny feeling the debt will be more than I think. I will use this diary to keep me motivated as even logging on everyday to read you guys diaries spurs me on.

Thanks for reading.

outoftheviciouscircle

Today is both of our pay days from our main jobs. I also have a little job that brings in some extra money but won't get that pay until the beginning of January now.

I work away Monday to Friday most weeks. I have to pay all my petrol, meals, parking etc in advance. It makes budgeting a little difficult as I have to wait up to 6 weeks for my expenses to be paid. I'm currently putting £85 a week diesel in my car. I get 17p a mile back and that basically covers all my costs. I put all my work expenses on a credit card and pay it off when the expenses hit my bank account.

bekah89

Good luck! It all sounds really positive, amazing that you have the long 0% deals for some time yet, you’ll be able to get rid of a big chunk. That’s the most important thing having a home that you love 

enthusiasticsaver

Good luck with getting rid of the debt.  Moving house is often a reason for debt but you sound as if you are on top of it.  Sensible to address it though given the current  economy, the likelihood of your mortgage repayments increasing and the end of your energy fix.  £26 a month for gas and electric is awesome.  Ours is almost 10 times that 

outoftheviciouscircle

Thanks for popping in guys. While it's not good to have the debt, I'm not letting it get to me. Which I know is a very fortunate position to be in.
Enthusiasticsaver, I am absolutely dreading the day my cheap fix comes to an end. I know I'm very lucky that I managed to lock in when I did.
Bekah89, We really do love our home now so as long as we make good inroads into the debt then it will have really been worth it.

I still haven't got around to my SOA, Christmas prep is getting in the way of that but I have some time off after Friday so I'll take a look into that then.
I did make some payments yesterday as it was payday on Thursday. I paid a total of £1412.00, clearing my Next account completely. It feels good to have one less creditor on the list.

Sarahwithlove

Welcome back! Do you do a tax return for your mileage? As I believe the hmrc rate is 25p a mile. If you are doing a lot of miles it might be worth it 

outoftheviciouscircle

Sarahwithlove said:

Welcome back! Do you do a tax return for your mileage? As I believe the hmrc rate is 25p a mile. If you are doing a lot of miles it might be worth it 

I'm not sure if I can???
I get 17p a mile in expenses, its a company car. Would I only fill in a tax return if it was a car allowance I claimed?

outoftheviciouscircle

I have made some positive steps in the last couple of days. I have joined a couple of challenges for next year that I am determined to see through for the entire year. I also logged into my prolific account for the first time in months and have managed to complete over £40 worth of surveys in 4 days. I've set a goal to try and complete £5 worth of surveys a day (I know this is more challenging when universities have time off). I will withdraw the money once a month and pay it straight off one of the credit cards. I have so much time on my hands sitting in hotel rooms during the week, I may as well make the most of it.

outoftheviciouscircle

I have spent a little time completed my SOA.
With the unsecured debts I have put in what the minimum payment is although I do pay more than that with the aim to clear them before the interest free period ends.
I have made comments on some of the things that will stand out just to clarify.

Household Information[/b]

Number of adults in household........... 2

Number of children in household......... 0

Number of cars owned.................... 0[b]

Monthly Income Details[/b]

Monthly income after tax................ 2443.34

Partners monthly income after tax....... 1753.67

Benefits................................ 0

Other income............................ 0[b]

Total monthly income.................... 4197.01[/b][b]

Monthly Expense Details[/b]

Mortgage................................ 517

Secured/HP loan repayments.............. 0

Rent.................................... 0

Management charge (leasehold property).. 0

Council tax............................. 235.56 

Electricity............................. 13 (Cheap fix until 30th July 2023 and £66 government aid until April)

Gas..................................... 13

Oil..................................... 0

Water rates............................. 37.5

Telephone (land line)................... 0

Mobile phone............................ 43.52

TV Licence.............................. 31.8

Satellite/Cable TV...................... 28

Internet Services....................... 22.5

Groceries etc. ......................... 300

Clothing................................ 30

Petrol/diesel........................... 150 (My Fuel is claimed back every month)

Road tax................................ 0 (Car leased so tax included in car payment)

Car Insurance........................... 21.93

Car maintenance (including MOT)......... 30

Car parking............................. 0

Other travel............................ 0

Childcare/nursery....................... 0

Other child related expenses............ 0

Medical (prescriptions, dentist etc).... 0

Pet insurance/vet bills................. 21.93

Buildings insurance..................... 8

Contents insurance...................... 8.35

Life assurance ......................... 20.46

Other insurance......................... 13

Presents (birthday, christmas etc)...... 50

Haircuts................................ 40

Entertainment........................... 50

Holiday................................. 0

Emergency fund.......................... 50

Car Lease............................... 290.4[b]

Total monthly expenses.................. 1995.95[/b]

[b]

Assets[/b]

Cash.................................... 4500

House value (Gross)..................... 330000

Shares and bonds........................ 0

Car(s).................................. 0

Other assets............................ 0[b]

Total Assets............................ 334500[/b]

[b]

Secured & HP Debts[/b]

Description....................Debt......Monthly...APR

Mortgage...................... 170738...(517)......1.04[b]

Total secured & HP debts...... 170738....-.........-   [/b]

[b]Unsecured Debts[/b]

Description....................Debt......Monthly...APR

Wren Kitchen...................19500.....290.......0

Creation ......................765.......31........0

AO.............................276.......92........0

Samsung........................1000......27........0

Virgin CC......................4600......73........0

Sainsburys CC..................6801......76........0

Loan from FIL..................10000.....0.........0[b]

Total unsecured debts..........42942.....589.......-  [/b]

[b]

Monthly Budget Summary[/b]

Total monthly income.................... 4,197.01

Expenses (including HP & secured debts). 1,995.95

Available for debt repayments........... 2,201.06

Monthly UNsecured debt repayments....... 589[b]

Amount left after debt repayments....... 1,612.06[/b]

[b]Personal Balance Sheet Summary[/b]

Total assets (things you own)........... 334,500

Total HP & Secured debt................. -170,738

Total Unsecured debt.................... -42,942[b]

Net Assets.............................. 120,820[/b]

[i]Created using the SOA calculator at www.LemonFool.co.uk.

Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]

outoftheviciouscircle

It's been a couple of days since I checked in. The Christmas festivities well and truly took over.
We spent Christmas at my in laws this year and I was only in charge of small things like cauliflower cheese and stuffing so my costs were minimal. However, oh my Christmas is so expensive. We only buy for immediate family but there is 8 of them and I'm afraid I haven't really been budgeting for it. I have joined a few challenges for 2023. These will hopefully keep me thinking about the future. We will have to use the savings to pay off Christmas another small positive is that it won't plunge us further into debt.

Anyway Christmas was good. I ate too much, drank to much so today is a straighten the house back up and get back on with the daily chores before I go back to work for 2 days tomorrow. At least I get to work from home this week. Today should be a no spend day though fingers crossed. There are no plans to step a foot outside the door.
My auntie gave us £40 in £2 so that's made me keen to start the £2 coin challenge. She's not moved with the times at all and refuses to even spend on a debit card. Everything is cash and she has this massive chest full of £2 coins at the end of the bed. I'm surprised the ceiling hasn't caved in. We all know not to lend her any money as we always get it back in change.

We had a chat about our financial position yesterday and we are both on the same page that we need to be as frugal as possible to ensure that we pay as much of this debt off as possible this year. Where we fall down is definitely with the grocery spend. We can never agree on what to have for dinner and end up with a takeaway and we are awful at taking lunch to work. It's a little more difficult for me, working away means it difficult to keep things fresh but I need to look at other options to put an end to £5 a day lunches.

outoftheviciouscircle

Today has been a good day.
The house has been cleaned from top to bottom, tax return has been submitted and I've completed £5 worth of surveys on Prolific. I didn't expect that this time of year so that was a nice surprise. I've set myself a goal of completing £5 worth of surveys a day. It may not be possible but it give me something to aim for and an end goal of £1825.

I paid for Tesco delivery saver today. I am aiming to use this to stay within a grocery budget and stop impromptu visits to the supermarket. If I spend no more than £50 a week that will keep us within the £200 budget. I've also included bits and pieces to take to work to stop the expensive lunches each day.

I think I may have some convincing to do with DH, he always seems to have these wants rather than needs but of course to him they are needs. He shows little interest in our finances although he know how much we owe etc. I think a good starting point will be to get him interested so I'll see how that goes.