Ugly Debt Needs To Go

Drizella

Hi,

I am a long term viewer of this site but it is now time for me to jump in with a diary and start to pay down this ugly debt that has been hanging around us.

Unfortunately in August I had to reduce my hours at work due to ill health.  Finally I have a diagnosis but it is going to take sometime to get back to good health and so some time till I can earn more money.  Thankfully DH received a decent pay rise in the summer and with him doing over time we are lucky that the reduction in my salary (which was fairly low anyway) has not had an impact on us and I hope this remains the case. 

Our debt I have not yet got the total figure for.  That will be a job for this weekend however it is credit card debt of approx £20k.  We know how this debt has occurred (house renovations) and we are not using credit cards for everyday use so thankfully this should come down easily, if we stay focused.  All is on 0% as well so that is a blessing.

Our very low mortgage rate runs out next September we have a good LTV but even with that we will not get such a good rate again so the plan is to reduce our CC debt as much as possible before next September so that any increase in mortgage payment will not have too much of an impact on our finances.

My plan for my diary is to just keep a note of my thoughts and our progress in reducing our debt.

Tomorrow I should be able to post the dreaded figures (something I have been putting off).

Drizella

So a week has passed nut I have almost got the details of the cards together.  The total is more than I thought although I know we are not using the cards so I suppose that is something. 

This week I get paid and DH is doing a bit more OT so his pay at the end of the month should be good and the plan is to use his OT as additional payments on top of the minimum payments.  I have almost got my spreadsheet ready to include a column for additional payments so once I should be able to have a much clearer picture of how the debt is reducing.

Drizella

Total CC is £29,598.27 all on 0% for now.  
Total Savings £11,500 - as debt is on 0% I don't want to use the savings to pay any off, this may change once the 0% end and there are no 0% offers although I hope this won't be the case but you never know.

Savings should increase each month by at least £205 as we have DD set up for this to go into the savings.  I would like to keep doing this if possible so we have savings should we need to replace anything in the house or do some work.  

Spreadsheet now all ready to track minimum and additional payments to the debt.  Roll on pay day.

[Deleted User]

Looking forward to reading more about your plans to eradicate the debt. Perhaps posting a SOA would be useful?

Cloth_of_Gold

Drizella said:

Total CC is £29,598.27 all on 0% for now.  
Total Savings £11,500 - as debt is on 0% I don't want to use the savings to pay any off, this may change once the 0% end and there are no 0% offers although I hope this won't be the case but you never know.

Savings should increase each month by at least £205 as we have DD set up for this to go into the savings.  I would like to keep doing this if possible so we have savings should we need to replace anything in the house or do some work.  

Spreadsheet now all ready to track minimum and additional payments to the debt.  Roll on pay day.

It sounds as if you are now getting to grips with it. You have a realistic plan and a way of tracking progress, and once you see the debt coming down it will give you motivation to continue. If some unexpected and unavoidable expenditure occurs that throws you off track temporarily, don't be put off but get straight back to your plan as soon as possible. I think that getting on top of debt is like losing weight. Debt, like weight, is easy to put on but not so easy to get rid of. For both, though, the same principles apply.

Try not to have a spurge at Christmas but set yourself a budget for presents, food etc. but try to be fairly strict with yourself. Again, it's like losing weight: a Christmas splurge will feel great at the time but afterwards you will regret having undone a lot of hard work.

Well done on making a great start and I wish you the best of luck.

Squirrelz92

Happy shiny new diary!!! x

Drizella

I've been paid and DH is paid on Monday.  Tidying up my various pots from last month I have been able to send £109 to one CC and that's paid it all off  and I have sent an extra payment of £97 to one of the outstanding debts so I am fairly pleased with that. 
Looking at DH overtime he should have an additional £1,500 this month although with Xmas and some birthdays coming up I don't think I will be using all this for additional payments but will definitely aim to make some decent over payments on top of the minimum.

The freezer is fairly well stocked so I think I can get  away with not doing a big weekly shop so that should mean by the end of the month I will have some left over from the food budget but will see how it goes.  

MatyMoo

While the cards are all on 0% I would be inclined to pay the minimum each month & put any spare cash in to savings, especially if you are getting 5% on them. 

As the 0%’s run out or as you get near to remortgaging you can take a view on wether you should use the savings to pay the cards down. 

Drizella

Thank you MatyMoo I will have a think on that.

Drizella

Can't believe it's almost a month since I was on here.

So payday for me and I am working out the bank - I try to do this every day but since last week I have let it slip.

So left over from last month:-
Petrol   £120.32
Food  £45.03
Travel £4.00
Left over in bank account after all last months bills and expenses  £388.78
Total Extra to Debt or savings (haven't made my mind up) £558.13

We had a family birthday which included a meal out, a work night out and I have started on xmas shopping and topping up my bulk by household stuff so I did spend a lot last month out of the spare I knew we would have.

Minimum payments to debts this moth totaled £607.79

Drizella

So it's been a few weeks since I was last on and well everything went out the window with everyone in the house coming down with the horrible cold bug.   No over payments have been made but no debt added and everything for Christmas paid for out of our current account and that must be the 1st Christmas since the kids were born that this has happened so fairly happy with how things are.

So far this year I haven't done much or been out much so this has lead to 4 NSD already so pleased with that.
I have done an inventory of freezer food and I am hopeful that I will come in well under out food budget.  I think I will be paid around the 22nd or 23rd of this month so only just over 2 weeks away and I have £246 in the budget.  I have enough food for full meals and lunches for at least the next week will only need milk, bread and fruit to buy.  I shouldn't have to buy any chocolates or biscuits till at least easter with the amount we have left over 

Today will be a NSD.  Dinner is left over Gammon, chips and veg.