Taming £12k

FrugalAspirations

I meant to start this diary on 1 January, but better late than never, I suppose. I plan to add to it every day, even if it's not the largest update in the world, just to keep myself accountable.

As you can see from my signature, I have four credit cards:

CC1 - £1,418.78
CC2 - £2,097.48
CC3 - £4,250.46
CC4 - £4,905.78

Current outstanding total: £12,672.50

This debt has waxed and waned over the years due to things like car trouble when I haven't had the cash there to deal with it, emergency travel to my husband's home country, trying to make ends meet following maternity leave (roll on 30 free hours!), unexpected vet bills (I have insurance, but you have to pay up front first and don't get 100% back) and frankly being irresponsible when I was younger.

Tbh, I can afford to make the repayments, so it's not problem debt. I just don't want it hanging over my head and also damaging my already laughable prospects of owning a house.

The cards

CC1 is the only one I am currently paying any interest on. The others are all 0% cards, with various end dates – sometimes even within the same card.

The goal

My big financial goal for 2024 is to clear the balance on CC1. I think/hope that's quite achievable, especially as I put in quite a lot of overtime towards the end of last year that will be paid this month. Depending how big a bite I'm able to take out of it, I may revise this goal to target CC2 later in the year if CC1 is paid off quickly.

What am I paying?

Currently, I'm paying minimum balances across the board. These are January's payments:

CC1 – £42
CC2 – £52.44
CC3 – £41.74
CC4 – £125.79

As mentioned, I should be able to put a decent amount towards paying off CC1 at the end of this month.

What other debts do I have

I have an overdraft that I'm using but I'm not looking to reduce that just yet. I know it's costly, but I'd rather deal with the CC payments first. Then the OD will hopefully take care of itself as less money will be coming out each month. That's the theory, anyway.

I have a student loan from the SLC with a balance of about £10,000. I'm not looking to clear this particularly and am instead treating it like a tax until everything else is in order.

What is changing?

There are a couple of other things changing financially in my favour. My youngest will be eligible for some free hours at nursery from April and I've had a 5% pay rise, although what that means in practice once taxes and student loan are taken out remains to be seen.

What else am I doing?

I don't have loads of free time, but I will sometimes find an opportunity to do surveys etc online. I am also cautious of taking on too much overtime as I do like to see my family! It's all about finding a happy balance.

That's it for today. See you for a less comprehensive post tomorrow!

FrugalAspirations

So much for checking in every day...

Not an awful lot to report other than I paid £41.73 towards CC3, taking my new balance on that card to £4,208.73

vampirotoothus

Hi can you set the DDs up for all your cards to just above the current minimum rounded up. This makes it easier to budget and also looks good on your credit report as you are repaying more than the minimums. Can you move the interest bearing CC to a 0% one? Good luck V x

FrugalAspirations

vampirotoothus said:

Hi can you set the DDs up for all your cards to just above the current minimum rounded up. This makes it easier to budget and also looks good on your credit report as you are repaying more than the minimums. Can you move the interest bearing CC to a 0% one? Good luck V x

I think I probably will once my overtime has been paid and I'm able to make a significant payment to CC1. There will be more money to go around, so will be able to round the regular payments up. With the interest bearing CC, I opened a 0% card within the past 6 months and will need to open another to shift most of CC4 in July so would rather just pay it off as it is, especially as I'll be able to do a big repayment at the end of this month/beginning of next.

Only other thing to report today is that I paid £52.44 towards CC2 yesterday.

FrugalAspirations

Not much to report other than I've been able to set up mobile banking for one of my ccs again (got locked out of it, what a kerfuffle that was) and updated the total in my signature as all payments have now been made this month. £12,500 is a nice round number!

FrugalAspirations

Not much happened today other than it being an NSD, but I just got an email from my energy supplier that they are reducing my DD by £25 a month from February so will be able to incorporate that into my debt reduction calculations. 

FrugalAspirations

NSD today. Have picked up some extra shifts next month, although it will take a while for the money for my efforts to actually make it to my account.

FrugalAspirations

Bill for CC3 came through today. Minimum payment is £41.31 which I'll keep as I'm not sure how much I'll be paying off CC1 at the end of this month. I'll come back to this at the beginning of February, though.

vampirotoothus

Hi I would set your DDs for each of this as the minimum, just rounded up to the next £1. That will save you deliberating and is also good for your credit record as more than the minimum is being paid each month. Good luck V x

Aimingforthegoodlife

Good luck! It feels so good paying off even pennies more!

FrugalAspirations

Not much has happened over the past few days, hence no updates. However, I opened my pay slip this morning to discover my overtime hasn't been paid. Superb. Payday isn't til Wednesday so have contacted the relevant departments in the hope I can get it sorted, but the company is a bureaucratic nightmare so we shall see*. As things stand, though, it messes up my plans for payment somewhat.

With my pay rise, I'm earning an extra ~£120 on my base pay, so can point at least that at CC1 in addition to the DD. Then I will sort out my DDs to round them all up.

(*update: turns out someone forgot to click a button. I'll be paid in Feb   )