Getting rid of the debt....

IWantToBeFree_2

Just finally found out where to do the snowball calculator... If I can focus £800 a month on my debts, then I should be debt free by mid 2011.

Ideally I would like this date to be much sooner. I am getting married in June 2010 and by the time that date comes around, I would love for all my money to be my own and not having to pay it out as soon as the wage hits the bank.

If I pass my exams, my wage could rise by £10k instantly, and then the pay rises after that are pretty substantial every year, so realistically, should I pass in July, I could be credit card debt free this time next year with the loans following not much after.

Its something I really want to work, OH is already laughing at me for wanting to have a sealed tin to put my lose change in, as its currently in a tin which I can open, also telling me not to worry about money all the time, but having no debts would mean so much to me, I've been in debt pretty much since I was able to obtain credit and I've had enough now. I'm relatively young meaning that i've learnt my lessons early on and after the next few years should be able to enjoy life comfortably, but it still pains me so much that I cannot fritter away the wage on nice things every month and it has to go on debt instead.

IWantToBeFree_2

One of my loans has an interest rate of around 14%, its only a small loan, however, at 14% I want to get rid of it asap. Going to apply for a goldfish card tomorrow with the 4.9% BT interest and hopefully, as I don't have any defaults etc on my credit file, they won't reject the application. Would save quite a bit in interest and enable me to pay it off quicker & cheaper

chevalier

soulstripper wrote: »

:beer:
hi im new
so when i get used to this forum
il post my SOA
my main problem is how can i stop my wife bying clothes all the time:mad:
im begining to feel trapped in a spieal of debt
HELP !!!!!!!!!!!!!!!!!

Hi Soulstripper
If you start your own thread you will probably get more replies personal to you
regards
chev

Jenna

Loan 1: £274 - what's the APR?
Loan 2: £102 - what's the APR?
Loan 3: £192 - what's the APR?
Council Tax: £80 (estimated) - go to http://www.voa.gov.uk/cti/InitS.asp?lcn=0 and you will hopefully get a better idea, you can search by address
Internet: £15 - can you get a better deal?
TV licence: £10 - just so you know this is normally £25 / month for the first 6 months then £11.50 or so after that
Gas & Electric: £40 (estimated) - keep in mind the price hikes going on at the moment, check how long a contract you're tying in for when you switch - a lot of them are rolling 28 day contracts (which means you can switch again after you've been with a company for 28 days) so this means you will be able to switch again when the playing field is level, as it were - check out Martin's guide on this (see Utilities & Phones on the main menu of the site)
Shopping: £200 - we pay £180 for 2 people and eat well, but we are in the process of cutting this down - I definitely recommend the OS board, and do a menu plan - I find it really helps me buy just what I need. You will probably eat a better / healthier diet buying and cooking from scratch so it will have other benefits too
BT phone bill: £13 - can you get a better deal?
Buildings & Contents: £40 (estimated) - our estimated contents ins value is £40k (this probably over-insures us a bit, but better that than under!) plus accidental cover, worldwide cover up to £5k and "out and about" items cover up to £4k plus £25k legal expenses - this is with the AA at £11.84 a month. Check whether you can get a better deal by buying these separately or bundled together!
Friday pub money: £40 - why not try having some friends round to dinner occasionally - you cook, they bring a bottle - you can show off your new place and often they will invite you round another time too - it's lots cheaper and often just as fun!

Total: £1,863 - the outgoings above don't account for almost £400 of your joint earnings, have you tried keeping a spending diary to see where this goes to? www.spendingdiary.com is pretty good! I know it's a bit of a pain (and as you say your CC categorises things for you too - although you can do this on that site too) but the fact of having to write it down can make you think twice about paying out for something - or at least that's what I've found!

The other thing I notice about your SOA is that you account for petrol, but not MOT/car tax/insurance; there's nothing on there for haircuts or clothes; Christmas; or holidays. One tip I've found on here which is really helpful is to take these big expenses and divide the annual amount by 12, and just save up this (regarding it almost as a bill) each month.

OK - sorry that was a bit long - hope it helps! xx

IWantToBeFree_2

Jenna wrote: »

Loan 1: £274 - what's the APR?
Loan 2: £102 - what's the APR?
Loan 3: £192 - what's the APR?
Council Tax: £80 (estimated) - go to http://www.voa.gov.uk/cti/InitS.asp?lcn=0 and you will hopefully get a better idea, you can search by address newhouse is a band A property in Leeds, current house is a Band A property in Leeds, and its just under £800 a year, obviously it will go up soon, so budgetting for £80 a month but spread over the 12 months and not the ten we pay currently
Internet: £15 - can you get a better deal? My partner informs me we are on a 18 month contract with AOL, once that expires, in about 8 months, we shall probably go for a bundle deal and get the phone/internet/line rental as one cheaper package.
TV licence: £10 - just so you know this is normally £25 / month for the first 6 months then £11.50 or so after that.
Gas & Electric: £40 (estimated) - keep in mind the price hikes going on at the moment, check how long a contract you're tying in for when you switch - a lot of them are rolling 28 day contracts (which means you can switch again after you've been with a company for 28 days) so this means you will be able to switch again when the playing field is level, as it were - check out Martin's guide on this (see Utilities & Phones on the main menu of the site) One thing I will definatly be looking into when we move in is making sure we are with cheapest supplier. The guy we are buying off is with british gas for gas and npower for electric, I would prefer duel fuel for the ease so will be looking into that, due to working all hours god sends in the week and visiting family at weekends, hoping we wont be using too much anyway.
Shopping: £200 - we pay £180 for 2 people and eat well, but we are in the process of cutting this down - I definitely recommend the OS board, and do a menu plan - I find it really helps me buy just what I need. You will probably eat a better / healthier diet buying and cooking from scratch so it will have other benefits too Shopping is something we need to cut down on, especially since as a lot of it ends up in the bin as we don't get round to eating it before its out of date. Tried with my weekly shop today but it still came in at just under £50 and didn't even have that much to show for it. Gonna have to plan & budget much better
BT phone bill: £13 - can you get a better deal? Probably could if we looked around, won't be using landline really as we both have mobiles with loads of inclusive minutes, only having it so we can get internet.
Buildings & Contents: £40 (estimated) - our estimated contents ins value is £40k (this probably over-insures us a bit, but better that than under!) plus accidental cover, worldwide cover up to £5k and "out and about" items cover up to £4k plus £25k legal expenses - this is with the AA at £11.84 a month. Check whether you can get a better deal by buying these separately or bundled together! I've probably gone for a high end estimate there, but I would rather over estimate rather than under estimate. Once we have a completion date for the house will be shopping round to find the best deal for our needs.
Friday pub money: £40 - why not try having some friends round to dinner occasionally - you cook, they bring a bottle - you can show off your new place and often they will invite you round another time too - it's lots cheaper and often just as fun! Friday pub money is for a friday lunch time! Me & my partner work close by, and we treat ourselves to a drink on a friday. We don't spend a tenner, its more like £6ish....Its something I don't wanna deprive us of!

Total: £1,863 - the outgoings above don't account for almost £400 of your joint earnings, have you tried keeping a spending diary to see where this goes to? www.spendingdiary.com is pretty good! I know it's a bit of a pain (and as you say your CC categorises things for you too - although you can do this on that site too) but the fact of having to write it down can make you think twice about paying out for something - or at least that's what I've found!i know where it goes, goes on going out, football, eating out, and generally just frittering it away. Things like train tickets & hotels for weekends away, theatre tickets, etc etc etc, will be cutting down on this kind of thing until we find our feet in the house and get the debt to a lower level.



The other thing I notice about your SOA is that you account for petrol, but not MOT/car tax/insurance; there's nothing on there for haircuts or clothes; Christmas; or holidays. One tip I've found on here which is really helpful is to take these big expenses and divide the annual amount by 12, and just save up this (regarding it almost as a bill) each month.

OK - sorry that was a bit long - hope it helps! xx

My car is a company car through a salary sacrifice scheme, therefore I don't have to pay any maintenance costs, or for the tax or insurance. Its not that cheap but it means I can have a new car often, and it means I don't have to shell out on expenses other than fuel. I haven't been driving long & already have points on my license and when I've looked at insurance quotes if i was to buy my own car, they have been nearly as high as the monthly leasing cost so i'm not really any worse off by leasing. I have nowt to show for it at the end, but like I say, my insurance would be that high that its not worth having my own car after i've factored in buying it, mots & tax on top of the insurance.

Rarely have my hair cut & when I do my sister usually does it so not factored that in, although guess I should factor in my partners so I bet your looking at no more than £10 a month altogether, and thats on the over budgetting side.

Rarely buy new clothes either, spend most my time in work clothes & begrudge buying new ones so spend on that is minimal.

Holidays should be factored in, & they are repsonsible for a large chunk of CC debt.... £2.5k on a holiday last year on the plastic.... won't be happening again!

Don't apologise for it being long! It was very very helpful :-)

Wanna_Bee_Free

Hi there,

Just popping back over to see how you're doing. Well done for posting your SOA, and deciding to get rid of your debts. Seems to me the way you're approaching this is already getting there. Sometimes it's just about sticking to the plans you've made, at least for me it is!

Hope the advice and suggestions from others helps, I'd second the spending diary one if a chunk of cash disappears 'somewhere' each month - for me that's the bit I'm using to tackle my credit cards really.

The other thing I've found is if I go at it too much it gets a bit like dieting strictly - I have a tendency to binge-spend a few weeks later. Sometimes I need the equivalent of your £6 drinks on a Friday to stop me spending £60 on Saturday.

It looks as if you will be able to tackle this successfully now you've set your mind to it so good luck with becoming free!

Bee

IWantToBeFree_2

IWantToBeFree wrote: »

One of my loans has an interest rate of around 14%, its only a small loan, however, at 14% I want to get rid of it asap. Going to apply for a goldfish card tomorrow with the 4.9% BT interest and hopefully, as I don't have any defaults etc on my credit file, they won't reject the application. Would save quite a bit in interest and enable me to pay it off quicker & cheaper

Decided against this because despite the big difference in interest rates (14.01% to 4.9%) the size of the loan (small!) means I wouldn't really save that much over the 2 years it has left to run, certainly not the size of savings I would hope for anyway. Add on top a 3% BT fee & the benefit almost disappears.

With the loan I know I have to pay £102 a month, if I got the CC I could be inclined to not pay that much off if the minimum payment was smaller.

Should I desperatly need the £7ish a month I would save, I will reconsider.

IWantToBeFree_2

Struggling to follow my plans as my OH is not as keen on the whole money saving thing, and isn't exactly encouraging me and is getting a bit fed up of me penny pinching :-(

taxi73

Well done on what you've done so far...just talk OH round as it won't take long to clear if you work at it solidly..short term pain for long term gain especially when you get that big increase in wages..just a thought ...what company are your mobiles with ..if you have a contract with 02 then 8 meg BB is £7.50 p/m..very reliable so far

IWantToBeFree_2

Contracts are with 3, have over a year to run.

Also, we're tied into contract with AOL for a while yet so we can't change BB providers either.

Obviously when both are up we will look at alternatives to get the best deals.