Small Business, Big Debts

Prodigal50

Hello :-)

You are doing a great job keeping track of everything and getting those balances down. 

Nice to lower that  total balance. 

My situation was not dissimilar to start with. 4-5 credit cards and my credit rating was poor.

I left the paid off credit card accounts active as having a higher value of credit available to credit used  helps your credit score. That will keep the 0% offers coming. It felt like a real win once my credit cards started offering 0% deals again.

I know you said selling assets wasn't on the table but  is it possible to sell something that you can live without for the meantime (and replace later maybe)? That could be really good for your stress and worry levels and get rid of some high % interest debt. I totally know there are lots of reasons why this might not work for you. I sold pretty much everything I owned that wasn't nailed down. It was all unnecessary stuff (nice car hurt the most) your situation might be completely different I do understand. 

All the very best and will follow :-)

OldTimer2023

Prodigal50 said:

I know you said selling assets wasn't on the table but  is it possible to sell something that you can live without for the meantime (and replace later maybe)? That could be really good for your stress and worry levels and get rid of some high % interest debt. I totally know there are lots of reasons why this might not work for you. I sold pretty much everything I owned that wasn't nailed down. It was all unnecessary stuff (nice car hurt the most) your situation might be completely different I do understand. 

Thanks Prodigal!  I have actually been reflecting a bit on what you said, and I'm going to take a look at some of the stuff that I have stored at my parents house, and see if there is anything there that I could sell - or even give away (and lose some 'baggage').  I don't think there will be anything of much value there, but it could definitely add-up - so thanks again for the suggestion :-)

And, yes, I completely agree, selling my nice car definitely hurt the most too, but I keep telling myself that if it's meant to be then maybe it will come back to me at some point, when the time is right haha

OldTimer2023

Update time again!!!

	LBM Oct23	May-24	Repaid	Repaid %
Bank Loan	£12,263.16	£10,612.35	£1,650.81	13%
Bank CC	£971.95	£396.95	£575.00	59%
CC1 (Bcard)	£0.00	£0.00	£0.00
CC2.1 (Virgin)	£7,375.50	£7,915.31	-£539.81	-7%
CC2.2 (MBNA)	£1,470.00	£0.00	£1,470.00	100%
CC3.1 (Halifax)	£8,691.48	£8,886.57	-£195.09	-2%
CC3.2 (Halifax)	£3,697.40	£2,624.11	£1,073.29	29%
Bounceback Loan	£48,315.97	£43,836.92	£4,479.05	9%
TOTAL	£82,785.46	£74,272.21	£8,513.25	10%
Challenge Total	£34,469.49	£30,435.29	£4,034.20	12%
Emergency Fund	£1,000.00	£0.00	£0.00	0%

No extra payments this month, but no new debt either, so I'm still 'chipping away' at it.

I got my new free Credit Store via the MSE Credit Club, and noted that they have recently changed provider, which has bumped me up from a 'Poor' to 'Fair' so, again, chipping away...

I've got a big trip home coming up in the next few weeks, but most of the major spend has already been done in advance and/or already accounted for which means that, in theory, I should have a lot more funds available to throw at my debts in the second half of the year - oh, and I need to arrange another Balance Transfer in July too.

So, there we go, not a huge amount to report this month, but I'm still here, and still chipping away at those balances.

We'll all get there in the end.

Take care everyone,
Old Timer

OldTimer2023

Well, that's another month down!

	LBM Oct23	Jun-24	Repaid	Repaid %
Bank Loan	£12,263.16	£10,376.52	£1,886.64	15%
Bank CC	£971.95	£296.95	£675.00	69%
CC1 (Bcard)	£0.00	£0.00	£0.00
CC2.1 (Virgin)	£7,375.50	£7,836.16	-£460.66	-6%
CC2.2 (MBNA)	£1,470.00	£0.00	£1,470.00	100%
CC3.1 (Halifax)	£8,691.48	£8,917.32	-£225.84	-3%
CC3.2 (Halifax)	£3,697.40	£2,481.66	£1,215.74	33%
Bounceback Loan	£48,315.97	£43,273.66	£5,042.31	10%
TOTAL	£82,785.46	£73,182.27	£9,603.19	12%
Challenge Total	£34,469.49	£29,908.61	£4,560.88	13%
Emergency Fund	£1,000.00	£0.00	£0.00	0%

So that's nearly £10k paid back in total since October, and I honestly cannot tell you how much I wish that money was in my back pocket instead - BUT - the only way that is ever going to happen is by getting the debts cleared, so I'm trying to tap-in to that as extra motivation.

I had put all of my Credit Card DDs down to Minimum Payment, as part of the Snowball method, but I feel like it's hurting me in those months when I can't make overpayments, so I'm thinking of fixing them all to a level just above the Minimum.

The Snowball should see me paying off the Bank CC in a few months (yay!) but after that it's going to take quite a while to clear the other balances, as they are all a lot larger.

I've also messed up my Halifax CC a bit, as the smaller (newer) balance is higher interest, which means it will get paid off first when I do the next Balance Transfer.  Hopefully I'll be able to transfer the full outstanding balance, otherwise I'll have to throw everything at what's left (before it goes up to 25.9% APR).

Another +5 points on my Credit Score this month, so that's (gradually) heading back towards 'Good' again.  I was tempted to apply for a new 0% BT card to move the Halifax balance, but if I can manage this within my existing cards then my Credit Score should be in a better place when my next BT is due in June 2025.

And then lastly, part of the reason why I created this diary was to be honest with myself so, in that regard, I have been definitely feeling a bit 'down' RE money lately.  It would just make such a difference to my quality of life if I did not have all of these repayments to make... and I know there's nobody to 'blame' but myself... and I know that the only way out of it is by going through it and paying it all off... but sometimes it just gets me down a bit more than usual, and it has been one of those times lately.

It will pass though, as will the debts.

Take care all,
Old Timer

OldTimer2023

Hello all!

Update time again, after a bit of a challenging month finance-wise...

	LBM Oct23	Jul-24	Repaid	Repaid %
Bank Loan	£12,263.16	£10,140.69	£2,122.47	17%
Bank CC	£971.95	£196.95	£775.00	80%
CC1 (Bcard)	£0.00	£0.00	£0.00
CC2.1 (Virgin)	£7,375.50	£8,757.80	-£1,382.30	-19%
CC2.2 (Haifax)	£1,470.00	£0.00	£1,470.00	100%
CC3.1 (MBNA)	£12,388.88	£11,707.50	£681.38	5%
Bounceback Loan	£48,315.97	£42,706.24	£5,609.73	12%
TOTAL	£82,785.46	£73,509.18	£9,276.28	11%
Challenge Total	£34,469.49	£30,802.94	£3,666.55	11%
Emergency Fund	£1,000.00	£0.00	£0.00	0%

So, yep, I added some new debt for the first time since my LBM back in October 2023 

Long story short, I was back over in the UK/Europe for an extended period, and everything is just sooo damn expensive over there.  I don't regret the spend, as it was all linked to spending time with my loved ones, but it needs to get cleared ASAP!!!

This has forced me to take another good, hard look at things - and I've decided to sell an asset that could potentially free up a good lump sum to throw at my debts (£4-5k).  It's not the most liquid of assets, so it might take a couple of months to find a buyer, but that will give me some time to decide how best to allocate the funds.  I was 'snowballing' previously, but a lot of my debts will be at quite similar levels soon, so I think I need to start considering interest rates and also when 0% deals are expiring (I have two transfers due very close to each other next year, in June and July).

Speaking of which, I was able to complete the needed Balance Transfer this month, which is great - however - the new card has a 2.5% min payment (rather than 1%), which might impact where I choose to allocate that lump sum if/when it arrives.  I managed to transfer the full balance at 0% for 12 months, though with a rather hefty 5% fee.  The 'good news' though is that I transferred it to an existing card, so no new applications needed, which will hopefully help to rehabilitate my Credit Score.

RE Credit Scores, my July Score went up by 20 points, meaning that I literally just managed to scrape into the 'good' category (by 1 point!) for the first time in a while - which is 'good' news!  I know that these scores are only for reference, but it feels great to be moving in the right direction.  I will probably close my Bank CC when that is paid off in ~2 months time, so that should also have a positive impact.

So, in summary, a bit of a challenging month, but I'm still moving in the right direction overall, and this experience has forced me to make some tough decisions that will give my finances a bit of a boost - and might even put me back on track towards having everything cleared by the end of next year (though that remains my 'stretch' goal.

Ok that's me.  Going to take a look at everyone else's journals now.

Have a great day everyone!
Old Timer

Lonelygambler

It is the challenging months we look back and go 'we got through it, I can do it'. 

Keep it up. LG

Aimingforthegoodlife

Hey @OldTimer2023 you are doing brilliantly! I think the takeaway from adding to the debt, is that you know exactly where that money went, and in fact, it was spent well! Just like many things, debt repayment isn't linear, it is normal to have ups and downs and consistency is the key! Love seeing your updates!

OldTimer2023

Update time again!

Thank you so much for the comments last month, guys!  I can't tell you how much I needed to hear some words of encouragement last month, and that is what I love the most about these forums.  Just knowing that we are all in it together.  It means a lot.

Ok so I guess I'm 'back on track' this month.  No new debt added, and I'm back 'chipping away' at things again.

	LBM Oct23	Aug-24	Repaid	Repaid %
Bank Loan	£12,263.16	£9,904.86	£2,358.30	19%
Bank CC	£971.95	£96.95	£875.00	90%
CC1 (Bcard)	£0.00	£0.00	£0.00
CC2.1 (Virgin)	£7,375.50	£8,709.82	-£1,334.32	-18%
CC2.2 (Haifax)	£1,470.00	£0.00	£1,470.00	100%
CC3.1 (MBNA)	£12,388.88	£11,414.81	£974.07	8%
Bounceback Loan	£48,315.97	£42,049.90	£6,266.07	13%
TOTAL	£82,785.46	£72,176.34	£10,609.12	13%
Challenge Total	£34,469.49	£30,126.44	£4,343.05	13%
Emergency Fund	£1,000.00	£0.00	£0.00	0%

Only one more payment left on my Bank CC (yay!), and then I'm going to divert that £100 payment to my Emergency Fund until I build up at least £500 in there.  I will close that CC Account once paid off, as the credit limit is quite low, and I have enough existing cards to cover my future Balance Transfer needs etc.

My mobile phone is worryingly starting to show those telltale signs of a slow death (it will be 3 years old next month), but hopefully I can eke another 6 months or so out of it, and the goal will be to replace it without dipping in to the Emergency Fund.

As mentioned last month, I've decided to fix all my monthly DD repayments.  Something about making only the Minimum Payments each month just didn't feel quite right to me, so for the sake of a few extra £'s a month, I prefer the peace of mind and certainty from knowing that I'm chipping away at a fixed level.

My Credit Score randomly took a slight dip this month, which was enough to knock me back into the 'Fair' category.  I'm guessing this is probably due to recent movements from my Balance Transfers, meaning that my MBNA card is now closer to the limit, which they say can impact your score negatively.  Should just be a temporary thing though, and my overall debt is going down - which is what I care about the most.

In theory I have no need to make any new applications until my Virgin BT expires in June 2025 - and in theory I can move that balance to an existing Card - so that should help to build up my Credit Score a bit.

So am I on track for clearing all my debts by the end of 2025?!  Probably not, but am I heading in the right direction?  Absolutely, yes, and I'm feeling good about that

Sarahwithlove

Well done you're doing well. Any luck on the selling of items? 

It's always a good idea to fix your DD just above minimum payment otherwise it looks like you can only afford the minimum. Also the minimum will just keep going down each month so more comes off the debt in long run especially on your cards with interest. 

Once you have your EF I would focus on whichever card has the shortest 0% so you have less to balance transfer. If there isn't much difference then focus on the one with the highest utilisation as like you said that can impact your credit score. 

OldTimer2023

Thanks Sarah!  Super-useful tips there, thank you so much!

I'm kinda procrastinating a bit on selling the item I mentioned, which is weird.

I know that I want to sell it, and I've totally made peace with that decision... but for some reason I haven't gotten around to actually listing it for sale yet.

So, yes, I'm now going to put that very firmly at the top of my weekend to do list :-)

And then if/when the sale funds do hit, I need to think about how I'm going to use them...

I have a bonus coming in December too, so I guess I could put £1k straight into my EF and then put the remainder towards one of my cards, or stash the cash somewhere until the next 0% deal is up, or put it against my Bank Loan (highest APR).  Anyway, nice to have options

Thanks again for the advice, it means a lot.

Old Timer