Debt-free in 12 months?

count_rostov

Hurrah, some good news for us! I've just got a new job which is much closer to home and even pays a little more! Our debt-free journey can continue...

count_rostov

But the bad news is that my fiance's pick-up failed its MOT. It would have cost more than the vehicle is worth to put it through, so he had to borrow £6000 for another one. This is a business expense so I'm not counting it as part of our personal debt, but he borrowed £1000 of our overdraft facility to pay the VAT. He'll be able to pay it back when he gets the next VAT return through, but until then a lot of our hard work is undone!

count_rostov

Payday today so I've updated my spreadsheet. Today was meant to be the day our debt went down to four figures. But, it's back up at almost £13000! Grrrr! Once my fiance gets the VAT back on his pick-up we should be back on track, but it's still pretty disheartening:
1 RBS c/c 0% £1050 £950
2 RBS c/c 0% £2448 £2236
A&L overdraft 4.00% £1421 £1470 ooops
A&L c/c 0% £2925 £2773
Dad 0% £1100 £900
Career development loan 0% £1904 £1524
RBS overdraft #1 19.05% £768 £1179
RBS overdraft #2 19.05% £0 £1331
Total: £12,944
I've checked our credit reports. Mine is clear, thank goodness, and I've just got a new 0% card. I'll use this to clear the A&L card, which only has a month left on the promotional period. The RBS cards are 0% until Jan 2009, I plan to pay the smaller one off by Christmas, and get another 0% card for the larger one (fingers crossed).
My fiance's credit report was not good news - he's got a default from Natwest, this is when he forgot that a dormant account had a monthly fee and managed to rack up almost £1000 in unauthorised overdraft fees. (I settled the account when we started debt-busting and it shows as satisfied). He also has a series of late payments from Orange and it shows an outstanding amount, even though he settled it a few weeks ago. Does anyone know how long Creditexpert takes to update?
This default really worries me as we will remortgage in Jan 2010 and although we'll have cleared our debt we won't have saved enough to bring the mortgage down to a level where it could be calculated just on my wages. His credit card will be paid off by Christmas - I assume it will be good for his credit rating to use this card regularly and pay it off in full every month? Is there anything else he can do make himself look more reliable to a mortgage lender?
Anyway, exciting news - we've booked our honeymoon! We're flying to San Francisco, going to a wedding where my fiance will be best man, hiring a car, then driving to Denver via the sierra nevada, grand canyon, and then basically following the Colorado river, although obviously there's no road along it. Hopefully we'll have some time in the Rockies too. We're going for just over three weeks which I'm sure won't be nearly enough time. Has anyone been there? Any suggestions on what to do and see?
The honeymoon should be pretty much debt-free, as my lovely lovely aunt gave us £1000, and the flights are an airmiles present from his sister-in-law. We'll take another £1000 and an empty credit card for emergencies. We hope to limit ourselves to $100/day, but don't want to pass by activities we couldn't do here. I'd love to hire some horses for a long trek, and he wants to do a motorcycle tour, but the idea petrifies me so I'm secretly hoping our driving licenses won't be valid for motorbikes or something!
Anyway, long post, clearly I don't have much motivation left for the last few weeks in my old job!

count_rostov

Oh dear oh dear. I've fallen off the wagon and am trying to climb back on.
An update on our situation: we got married last September, and I started a slightly better paid job at the same time. However, there is no internet access at the new job and we gave up on dial-up as it was slow and expensive, so had no access to online banking, or, more dangerously MSE! I know that this is a rubbish reason but it really made me take my eye off our spending and debt-repayments. In short, we're in the same financial position we were a year ago, but I'm now also pregnant!
We're both excited about the baby, but really worried about money. My new job is in retail management, with entire days on my feet, shift work etc. I plan to work for as long as I can but am budgeting that I will be able to work up to 33 weeks (I'm now 15 weeks). This doesn't give me much earning time left and we still have so much debt!
After my maternity leave, I really don't want to go back to work more than 2 1/2 days a week as my mother and husband could cover this amount of childcare. But it will be such a drop in income. I don't think we will ever shift our debt.
Looking back over this thread, I see how organised I was a year ago and really need to get back to that place. We've agreed to a spending diary over next month to see where it all goes and to make a proper budget. We both earn around about £1400 a month after tax so I don't understand why we're so broke. I just feel that everything is out of control at the moment.
One good thing is that we did lots more work on our house over the winter and it is now full of mod-cons like heating. Actually, it's becoming very comfortable and is less like a building site every week. So we won't be battling the north wind to keep the baby warm and alive all the time.
So, I will have a budget and SOA in a few weeks but in the meantime I'd really appreciate any words of encouragement and tips on how to rear a young-un on pennies!

TotallyBroke

Hi not much to say but one piece of advice. Don't think about going on maternity at 33 weeks. Try and go as long into the pregnancy as you can. The longer you work the more time off after you can have. Also an active Mum is an active baby. Your labour will be a lot easier hopefully if you are active. Myself worked on the Wednesday gave birth on the Thursday and had only a short labour for a first child.

count_rostov

Wow TotallyBroke, I don't think I will be able to manage that! I am just sooooo tired at the moment. I haven't had any sickness though which has been good.
I think you're right though, that I need to work for as long as I can and earn as much as I can. Reading other expectant mothers' posts on this board I realise that I should be saving rather than repaying. I had been saving a small slush fund but it will only be enough to pay for an unexpectedly high car service, say, rather than service debts whilst I'm on SMP.
So, I've been looking at lots of options over the past few days. I even thought about adding the debt to our mortgage as we remortgage this year! Luckily my husband put his foot down on that one, don't know what I was thinking...have I learnt nothing?
Anyway, now I've opened a third joint current account so now we have 1) for mortgage, bills, c/c repayments, insurance and 'known' household expenses that I can put a fixed amount into each month 2) for eating, fuel, coal/oil and 'unknown' household expenses 3) money for doing up our house. My husband will keep 50% of his income in his business, and put 25% in accounts 2 and 3.
I was also accepted for a low-interest Barclaycard which I will transfer the smaller c/cs on and as much overdraft as the credit limit allows. Then I will cancel the paid-off credit cards and overdrafts as this is where our problems started! Our finances will look neater then, even though they're the same size: Halifax c/c 0% £3396 Tesco c/c 0% £2736 Barclaycard 6.3% about £4000 hopefully. We will still owe a horrific amount of money but I will feel more in control. The minimum payments will be about £120 a month so my goal is to save about £2500 between now and maternity leave. I really wish I'd got my act together when I first found out I was pregnant - ah well.
This looks so organised on paper, I hope we can stick to it. The other problem is that I haven't factored in any baby expenses here except loss of income. I've been promised a moses basket and a cot and my mother has been doing loads of knitting. I plan on breastfeeding. There are no roads with pavements here so I won't need a pram/buggy. So I'm thinking the things we really need to buy for the baby are: a carseat, a cot mattress, one of those cloth carrier/wrap things, some nappies, babygrows, muslin squares, and a baby sleeping bag. Is this really niave? Are there any other essentials people would recommend?
Anyway, off to plant tatties now so that when I'm on SMP at least we can still eat potatoes done 100 different ways.

TotallyBroke

count_rostov wrote: »

Wow TotallyBroke, I don't think I will be able to manage that! I am just sooooo tired at the moment. I haven't had any sickness though which has been good.

I was tired at the beginning of pregnancy, fine during the middle then got a burst of energy 2weeks before lo was born then 2 nights before he arrived I was tired. Go as long as you can, I had a friend that had it in her head she would stop work 3 months before, she turned lazy she did nothing but sit and watch tv when it came to labour she had the laziest baby going. Took hours for her to arrive. Why not save up your holiday and ask your boss if you could split your holiday up so that you can leave early each day in the last month or two, maybe the closer to your due date the earlier you go home.

count_rostov wrote: »

I think you're right though, that I need to work for as long as I can and earn as much as I can. Reading other expectant mothers' posts on this board I realise that I should be saving rather than repaying. I had been saving a small slush fund but it will only be enough to pay for an unexpectedly high car service, say, rather than service debts whilst I'm on SMP.
So, I've been looking at lots of options over the past few days. I even thought about adding the debt to our mortgage as we remortgage this year! Luckily my husband put his foot down on that one, don't know what I was thinking...have I learnt nothing?

Well done to Husband, but don't let him get to used to putting his foot down lol

count_rostov wrote: »

I was also accepted for a low-interest Barclaycard which I will transfer the smaller c/cs on and as much overdraft as the credit limit allows. Then I will cancel the paid-off credit cards and overdrafts as this is where our problems started! Our finances will look neater then, even though they're the same size: Halifax c/c 0% £3396 Tesco c/c 0% £2736 Barclaycard 6.3% about £4000 hopefully. We will still owe a horrific amount of money but I will feel more in control. The minimum payments will be about £120 a month so my goal is to save about £2500 between now and maternity leave. I really wish I'd got my act together when I first found out I was pregnant - ah well.

Great news on the transfer, it might be the same amount of debt but it is costing you less in interest.
I had not saved a penny when my lo came along, I had no plans to have him. In fact I was in trouble Woolwich wanted to repossess my home. I got everything secondhand for lo, the only new he got were presents from other people. In fact I think the first item of clothing that I bought him new was his first shoes at 14months. So it is doable (if that is a word).

count_rostov wrote: »

The other problem is that I haven't factored in any baby expenses here except loss of income. I've been promised a moses basket and a cot and my mother has been doing loads of knitting. I plan on breastfeeding. There are no roads with pavements here so I won't need a pram/buggy. So I'm thinking the things we really need to buy for the baby are: a carseat, a cot mattress, one of those cloth carrier/wrap things, some nappies, babygrows, muslin squares, and a baby sleeping bag. Is this really niave? Are there any other essentials people would recommend?
Anyway, off to plant tatties now so that when I'm on SMP at least we can still eat potatoes done 100 different ways.

You will need a car seat yes, a moses basket will last betwen 3 and 6 months depending on size so don't worry about the cot just yet. (I bought a cot albeit secondhand £25 and my lo would not sleep in it, his head touched the £80 new mattress twice!!) But it would be advisable to get a new moses mattress. You don't need a sleeping bag, if your child likes the comfort of being confined (like in the womb) then swaddle them in the blanket. There is a certain way to wrap the blanket around them.
Look on the NCT website, they have nearly new sales, you can pick up some great stuff really cheaply.

redstararnie76

Hi,
Couple of things occur to me - check your work's maternity policy - also talk to your boss about regular breaks during your shifts so you can put your feet up. It's in their interests to keep you working as long as possible into your pregnancy so see what they'll agree to.
Also as the previous poster mentioned, see how you can use your holiday. When I was pregnant, I arranged to use mine to give me regular half days off in the run-up to my leave. I was also able to do something similar to ease me back into work after my leave.
You won't need much stuff for the baby initially - some clothes (not too many, you'll be amazed how quickly they'll grow out of them!), moses basket, nappies and car-seat should cover most of your immediate needs. I found ebay invaluable and freecycle should be really helpful too - I got a car seat/carrier/pram set thing, cot, moses basket, clothes, highchair and pretty everything else off ebay and it saved me an enormous amount of money (though should point out - be careful with the car seat - you are officially advised not to buy this second-hand in case there's been an accident or anything like that)