Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • DrSpendLittle
    • By DrSpendLittle 22nd Aug 17, 4:30 PM
    • 343Posts
    • 1,159Thanks
    DrSpendLittle
    Reducing Debt - being accountable and taking responsibility
    • #1
    • 22nd Aug 17, 4:30 PM
    Reducing Debt - being accountable and taking responsibility 22nd Aug 17 at 4:30 PM
    Hi everyone!

    DFW newbie here! Been a lurker for a while but have been so inspired by reading others' DFW diaries - it's literally all I've done this weekend! - that I decided to take the plunge and join in the fun. Now's the time. Had my LBM a few weeks ago and can't wait to get started

    So, a little about me before I state my financial situation and my goals:
    - a happy, healthy and engaged homeowner
    - settled in my career with a fairly well paid job & annual increment
    - looking at starting a family soon as time is ticking!
    - enjoys sports and the outdoors and a healthy approach to life
    - has just started using YNAB
    - has a 'secret' unsecured debt of just over £10k (2 x cc's)

    About DF
    DF is debt free but doesn't actively save. He seems to spend what he earns which isn't great since we have a tiny mortgage and lowish bills. He had family money passed on to him a few years ago on the advice of his mother's accountants - she would NEVER give it away otherwise. This dosh acts as a financial cushion for him .....and, admittedly, me gosh, it really has meant I've been a wee bit lacking in the old saving malarkey Time to banish this false sense of security!

    About DF and I's financials
    DF and I don't have a joint account. All bills / mortgage come out of his current account except car insurance and broadband/phone which I'm responsible for paying. I give him £465 every month towards bills (includes a deduction for car insurance) and he gives me half of whatever the broadband phone bill is. This arrangement is, on reflection, part of my problem as I have too much 'distance' from the reality of bill payments and direct debits etc etc etc I'm sure you all know the score....

    DF knows I have some debts but isn't really aware of the current status of my 'net worth' He's one of life's worriers so I am taking this DFW journey alone for now. I'm completely settled and happy with this idea and I have been managing it all on my own thus far, so no need to change. I got myself into this situation so I'll be getting myself out of it.

    Why the DFW diary?
    Well, we're thinking of moving home since we could take a few leaps up the ladder. Its time for our dream home. This has caused my LBM. I want my dream home and the only thing stopping me is my poor money management skills! Its also time to move. We've been here a while and have never fully settled.

    My interim goal?
    To clear £4K of debt by January so when we put the house on the market, my debt levels are lower. I obviously also want to make sure we can maximise our borrowing, so I want to demonstrate good money management skills and a good pattern of spending and saving.

    My overall aim
    But, more than this interim goal, I just want to be in control of my money and no longer feel guilty for spending it. I want to save up for things and have that lovely 'I deserve this because I saved for it' feeling when I buy something. I want to be responsible. And, I am here to become accountable.

    My plan of action!
    So....this diary is my way of sharing my story, being accountable for my actions, taking responsibility and doing all this whilst my other half is oblivious!

    I hope you join me on my journey and I look forward to joining you on yours.

    My current financials
    I'll post my current financial situation later today - got some work things to get done before close of play. Its been one of those 'working at home' days which have largely comprised of obsessing over YNAB and lurking on DFW diaries, oh deary me A hint of my procrastinating / self sabotaging ways......

    DSL
    Last edited by DrSpendLittle; 30-09-2017 at 9:20 AM. Reason: I'm a formatting perfectionist :)
Page 17
    • DrSpendLittle
    • By DrSpendLittle 17th Jul 18, 9:00 AM
    • 343 Posts
    • 1,159 Thanks
    DrSpendLittle
    Good morning peeps,

    In the office bright and early this morning. Got a few busy days ahead of me and then its a WFH on Friday. Not sure on plans for the weekend just now. We're seeing friends at some point but haven't firmed up plans.

    I think I'm going to overspend on groceries this month. Not sure why. Maybe I've done most of the food shopping. Anyhoo, DF will be frogmarched to the supermarket to do the next shop

    Finances are feeling tight at the moment with a few unexpected expenses. But, I've got a fairly healthy holiday budget (we don't spend too much on holiday really, just fuel and groceries mainly) so I'm hoping that I can move money around my budgets once we're back. This will be my first MSE summer holiday (I had a short break with family in April) and I'm looking forward to observing my own spending behaviours and seeing how 'normal' my MSE ways have become.

    Right, back to the grind. A full day of fairly interesting meetings and its not too hot so all is good!

    DSL
    Since 1st September 2017
    CC1: £paid off/£1,253.73 | CC2: £4,124.16/£9,124.15 | CC3: £paid off/£312.34 | Car Finance: £paid off/£1,894.92| Total Debt Repayments: £7,585.15/£12,585.14 (60.27%) | LBM Debt Exposure: £13,915.17 | Outstanding Debt: £4,999.99
    • DrSpendLittle
    • By DrSpendLittle 17th Jul 18, 9:03 AM
    • 343 Posts
    • 1,159 Thanks
    DrSpendLittle
    I've just realised. This time last year I was £13,400 in debt, doing balance transfers and living in my £1,000 overdraft.

    Now I'm only £5,000 in debt, paying extra into my pension and have never felt richer!

    Can't wait until November 30th!
    Since 1st September 2017
    CC1: £paid off/£1,253.73 | CC2: £4,124.16/£9,124.15 | CC3: £paid off/£312.34 | Car Finance: £paid off/£1,894.92| Total Debt Repayments: £7,585.15/£12,585.14 (60.27%) | LBM Debt Exposure: £13,915.17 | Outstanding Debt: £4,999.99
    • Moguline
    • By Moguline 17th Jul 18, 10:30 AM
    • 267 Posts
    • 724 Thanks
    Moguline
    You are doing so well, DSL! What great progress in just a year!
    LBM: Christmas 2017 Highest debt (01/01/2018): £23,786 As of 01/07/2018: £19,887 Total reduction in 2018: -£3,899 DFD of my dreams: 31/12/2019
    • DrSpendLittle
    • By DrSpendLittle 17th Jul 18, 10:39 AM
    • 343 Posts
    • 1,159 Thanks
    DrSpendLittle
    During my 'tea break' in the office I opened and read a letter that CC1's company sent to me yesterday. It's an update of their terms and conditions relating to CC1.

    The credit limit on the card is £11k. I didn't want to close it when I cleared it last year because I was concerned about reducing available credit and thus increasing my overall utilisation rate. Plus, I just didn't want to affect the status quo on my credit file (we're considering a house move soon). I think my current overall utilisation rate is 20% (including a £1200 overdraft facility) and my card-specific (CC2) utilisation rate is 48%.

    Anyway, I read the terms and conditions in some detail and realised how nice it was that I am no longer a slave to the lender and I no longer have to be bound by the strict changes they are proposing (especially the one about increasing minimum payments if they think you've been in debt too long, eek!).

    Ripped up and in the bin!
    Since 1st September 2017
    CC1: £paid off/£1,253.73 | CC2: £4,124.16/£9,124.15 | CC3: £paid off/£312.34 | Car Finance: £paid off/£1,894.92| Total Debt Repayments: £7,585.15/£12,585.14 (60.27%) | LBM Debt Exposure: £13,915.17 | Outstanding Debt: £4,999.99
    • DrSpendLittle
    • By DrSpendLittle 17th Jul 18, 10:46 AM
    • 343 Posts
    • 1,159 Thanks
    DrSpendLittle
    You are doing so well, DSL! What great progress in just a year!
    Originally posted by Moguline
    Thanks for passing by Moguline! I've just subscribed to your diary and I look forward to reading it tonight over a glass of wine!

    Part of me thinks I could have been more gazelle intense and cleared the debt in 12 months. But I had a few months off in March / April. I just needed a break from the intensity of using 43% of my income per month for debt repayments. I'm averaging 30% right now, which is still fairly good, just not A*!!

    DSL
    Since 1st September 2017
    CC1: £paid off/£1,253.73 | CC2: £4,124.16/£9,124.15 | CC3: £paid off/£312.34 | Car Finance: £paid off/£1,894.92| Total Debt Repayments: £7,585.15/£12,585.14 (60.27%) | LBM Debt Exposure: £13,915.17 | Outstanding Debt: £4,999.99
    • Moguline
    • By Moguline 17th Jul 18, 2:08 PM
    • 267 Posts
    • 724 Thanks
    Moguline
    I think that's still a fairly high percentage though!

    I'd revisit the idea of closing that credit card. A large amount of available credit isn't usually looked on favourable by banks as it means you could increase your debt and thereby your monthly outgoings by a large amount in one extravagant shopping spree, which is a liability. I'd close it or at least reduce the credit limit on it. Generally speaking, I think everything under 40% utilisation is seen as good.
    LBM: Christmas 2017 Highest debt (01/01/2018): £23,786 As of 01/07/2018: £19,887 Total reduction in 2018: -£3,899 DFD of my dreams: 31/12/2019
    • DrSpendLittle
    • By DrSpendLittle 17th Jul 18, 3:36 PM
    • 343 Posts
    • 1,159 Thanks
    DrSpendLittle
    I think that's still a fairly high percentage though!

    I'd revisit the idea of closing that credit card. A large amount of available credit isn't usually looked on favourable by banks as it means you could increase your debt and thereby your monthly outgoings by a large amount in one extravagant shopping spree, which is a liability. I'd close it or at least reduce the credit limit on it. Generally speaking, I think everything under 40% utilisation is seen as good.
    Originally posted by Moguline
    My thoughts had always been to keep CC1 (for 'catostrophic' emergencies until I had my 3-6 month expenses set up) and close CC2 when it was paid off. This is mainly because CC2 is The Card That Got Me Into Debt and I associate it with all my old bad spending behaviours. It's very symbolic and so cutting it up would be equally symbolic. However, with that said, I bank with CC1 so, hypothetically catastrophizing, the bank could garnish from my current account if I were to get in lots of debt again. It probably makes more sense to keep CC2 temporarily and be done with CC1.

    I will mull over but I think you're right, I should probably just close CC1 and reduce the available credit I have (currently £22,450 across three cards) in order to maximise my lending attractiveness for a mortgage. I may consult the mortgage forums first.
    Since 1st September 2017
    CC1: £paid off/£1,253.73 | CC2: £4,124.16/£9,124.15 | CC3: £paid off/£312.34 | Car Finance: £paid off/£1,894.92| Total Debt Repayments: £7,585.15/£12,585.14 (60.27%) | LBM Debt Exposure: £13,915.17 | Outstanding Debt: £4,999.99
    • Moguline
    • By Moguline 17th Jul 18, 4:15 PM
    • 267 Posts
    • 724 Thanks
    Moguline
    Yes, definitely something worth considering! I know what you mean though, my emergency fund cc is one I've never spent anything on, it was purely a balance transfer one. I don't even know the PIN for it and intend to keep it that way!
    I did however reduce the credit limit on that one from £12k to £5k, and that did improve my credit score a little. - However, my utilisation wasn't affected at that point as I had moved my other remaining cc debt to a personal loan instead, so it might be different for you.
    LBM: Christmas 2017 Highest debt (01/01/2018): £23,786 As of 01/07/2018: £19,887 Total reduction in 2018: -£3,899 DFD of my dreams: 31/12/2019
    • Moguline
    • By Moguline 17th Jul 18, 4:16 PM
    • 267 Posts
    • 724 Thanks
    Moguline
    Also, I'm not a homeowner yet so any major house disasters wouldn't affect my EF as they would be covered by the landlord instead. But, if you have building and contents insurance, then £5k emergency available credit should tide you over until you have a proper EF saved up.
    LBM: Christmas 2017 Highest debt (01/01/2018): £23,786 As of 01/07/2018: £19,887 Total reduction in 2018: -£3,899 DFD of my dreams: 31/12/2019
    • DrSpendLittle
    • By DrSpendLittle 17th Jul 18, 4:36 PM
    • 343 Posts
    • 1,159 Thanks
    DrSpendLittle
    Thanks Mougline! I've consulted the mortgage forum so lets see what they say.

    Luckily DF has plenty of savings so he is in effect my catastrophic emergency fund for house stuff until I build my own

    But, I'd still like a CC for other catastrophic emergencies I could hypothetically face such as getting stuck in a foreign country due to ash cloud, terrorist attacks etc etc, at least until my EF is nice and healthy. It may mean keeping CC2 for longer than I wanted and closing CC1 for now.

    Just home, looking forward to reading your diary tonight!
    Since 1st September 2017
    CC1: £paid off/£1,253.73 | CC2: £4,124.16/£9,124.15 | CC3: £paid off/£312.34 | Car Finance: £paid off/£1,894.92| Total Debt Repayments: £7,585.15/£12,585.14 (60.27%) | LBM Debt Exposure: £13,915.17 | Outstanding Debt: £4,999.99
    • DrSpendLittle
    • By DrSpendLittle 17th Jul 18, 11:36 PM
    • 343 Posts
    • 1,159 Thanks
    DrSpendLittle
    A nice little NSD today and we used stuff in the freezer / fridge for dinner. No other significant MSE updates, though my budget is feeling a little tight and there is still a good bit of month left!

    I'm out for dinner tomorrow night and I will also need to put fuel in the car, so some spends planned. Thursday I'm unsure on my plans but a friend wants a drink after work so I'll probably have some spends too.

    Hoping for a quiet week next week and a meal plan of beans and rice, rice and beans.
    Since 1st September 2017
    CC1: £paid off/£1,253.73 | CC2: £4,124.16/£9,124.15 | CC3: £paid off/£312.34 | Car Finance: £paid off/£1,894.92| Total Debt Repayments: £7,585.15/£12,585.14 (60.27%) | LBM Debt Exposure: £13,915.17 | Outstanding Debt: £4,999.99
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

1,675Posts Today

6,408Users online

Martin's Twitter