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  • FIRST POST
    • Storm89
    • By Storm89 3rd Jan 18, 2:45 PM
    • 491Posts
    • 864Thanks
    Storm89
    2 years to smash the debt !
    • #1
    • 3rd Jan 18, 2:45 PM
    2 years to smash the debt ! 3rd Jan 18 at 2:45 PM
    I'm starting a new diary because I didn't keep my last one up and I'm feeling rubbish about not paying off as much as I had wanted. My last target was to be debt free by the summer of 2020 but I'm determined to set a new target of December 2019. Taking it a year at a time though, so aiming for debt to be £10k by December and savings to be £3k (currently have no savings at all). I need to do this for my kids, I wish I could give them experiences and not have to cut back so much because of the silly mess we're in.

    As it stands the debt is
    Credit Card 1 - £6,330.83 0% ends in March
    Credit Card 2- £7,660.01 0% ends in November
    Credit Card 3- £1,873.59 0% ends in June
    Total - £16,027.43
    I need to figure out how to start shifting some of that debt onto other 0% cards soon I just don't know how to go about it. A card we have with zero balance has offered us 0% for 12 months and the amount we could transfer is around £5100 so not enough to cover the card that's up in March. So I'm not sure what to do really about this. I'm considering getting another 0% card but worry we won't get accepted.
    We're a family of 4 with a 7 year old and 4 year old and income from all sources is
    £2816

    Outgoings are
    £1516.62

    It gives us a surplus of £1299.38. I don't want to put it all on the debt but we're setting aside £500 a month for that. I've also created some savings accounts on my mobile banking that I've named and decided to set aside each month:
    General Savings - £250
    Very- £100
    Clothes- £40
    Center Parcs- £100
    Christmas and Birthdays- £100
    Anything we manage to save on top of this will pay off debt
    Having no savings in 2017 meant I had to use Very to buy things we needed. A hoover, pushchair, washing machine etc. We now have a balance of £1000 on there that's interest free as long as I pay within 12 months of when we purchased the items. I should count this in my total debt but it's too depressing to do so and I'll be paying it off anyway

    I've booked us a little holiday at Center Parcs for October half term. We've not been away at all last year and won't be going anywhere else until then , I just felt that I wanted to get the balance between paying off debt and having a little treat. I'll be using this thread to write my ramblings even if nobody reads it !
    Last edited by Storm89; 03-01-2018 at 2:51 PM.
Page 1
    • fatrab
    • By fatrab 3rd Jan 18, 4:13 PM
    • 841 Posts
    • 1,961 Thanks
    fatrab
    • #2
    • 3rd Jan 18, 4:13 PM
    • #2
    • 3rd Jan 18, 4:13 PM
    Hi,

    I'd pay £400 per month to the card ending in March then transfer the remaining balance to the 0% card.

    Then, £500 per month to the card ending in June.

    You might find that credit card 1 will offer you a 0% deal once the balance is cleared which you can transfer credit card 3 onto.

    You'll be down to 2 credit cards and can then pay £500 per month to very.

    Hope this helps
    You can have results or excuses, but not both.
    May's targets - Lose 1 stone - 6lbs off, 25/31 AFDs, 15/18 lunches.
    37 x £2 coins (#32) - Wannabe debt free by Dec 2022
    • Storm89
    • By Storm89 3rd Jan 18, 4:56 PM
    • 491 Posts
    • 864 Thanks
    Storm89
    • #3
    • 3rd Jan 18, 4:56 PM
    • #3
    • 3rd Jan 18, 4:56 PM
    hi thanks for replying . Would that work for my other savings accounts too ? the kids clothes and center parcs , christmas etc ? I need to have £600 for center parcs by August when the balance is due. & I'm determined not to have to use credit cards for birthdays or Christmas. I just did the eligibility checker and we got 100% for a 0% balance transfer card but I do wonder if they would turn us down with having so many cards currently open so maybe your idea is best. I'm just not sure how I would have enough left for the other cards plus my savings . I'm probably not reading it right though - I did fail maths GCSE and get into all this debt in the first place lol.
    • Storm89
    • By Storm89 3rd Jan 18, 4:59 PM
    • 491 Posts
    • 864 Thanks
    Storm89
    • #4
    • 3rd Jan 18, 4:59 PM
    • #4
    • 3rd Jan 18, 4:59 PM
    Oh also I forgot to add that the Very payments are spread across the year so I need £200 in May , £400 in August and £340 in October .
    • fatrab
    • By fatrab 3rd Jan 18, 5:15 PM
    • 841 Posts
    • 1,961 Thanks
    fatrab
    • #5
    • 3rd Jan 18, 5:15 PM
    • #5
    • 3rd Jan 18, 5:15 PM
    Absolutely definitely 100% do not spend on any of the cards that are being used for balance transfers.

    In the months where you have other big bills you'll simply need to reduce the amount you pay to the respective credit cards, it may take you slightly longer than you'd like to clear the balance of each card.

    You're more likely to be declined if you have made a lot of applications within the past 3-6 months but if you already have an offer available and you think you'll be able to clear that amount within that period then I'd be inclined to go down that route incase you need to apply for a new card later in the year.
    You can have results or excuses, but not both.
    May's targets - Lose 1 stone - 6lbs off, 25/31 AFDs, 15/18 lunches.
    37 x £2 coins (#32) - Wannabe debt free by Dec 2022
    • Choccygirl123
    • By Choccygirl123 3rd Jan 18, 5:18 PM
    • 110 Posts
    • 111 Thanks
    Choccygirl123
    • #6
    • 3rd Jan 18, 5:18 PM
    • #6
    • 3rd Jan 18, 5:18 PM
    Hi storm, popped by to say hi.

    Sounds like you have a plan in place and lovely youíve got your holiday to look forward to. Iím
    In the process of trying to save £1k and just avoid adding to our debt. Need to get beating abd selling again.
    Always counting down to pay day, but making baby steps getting life on track! Looking forward to cracking the debt once and for all.
    • Storm89
    • By Storm89 3rd Jan 18, 5:39 PM
    • 491 Posts
    • 864 Thanks
    Storm89
    • #7
    • 3rd Jan 18, 5:39 PM
    • #7
    • 3rd Jan 18, 5:39 PM
    fatrab I've not made an application in probably 18 months or more. I think I need to stick with my original plan purely so I have enough left over for my other savings. If I put £400 on the March card I wouldn't have enough leftover for the other things I don't think?
    Hi choccy good luck with the selling , I'll keep everything crossed you manage to save the £1k. I was much worse off financially last year and started the year in £18k of debt so I didn't make much progress. I like these forums as people can support each other
    • Choccygirl123
    • By Choccygirl123 3rd Jan 18, 6:04 PM
    • 110 Posts
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    Choccygirl123
    • #8
    • 3rd Jan 18, 6:04 PM
    • #8
    • 3rd Jan 18, 6:04 PM
    We!!!8217;ve been faffing around and seemto take one step forward, two back and three sidewise. Hubby!!!8217;s car died and we had to bite the bullet to buy a semi decent one, hence the second zoos loan. We!!!8217;ll get there, it just takes time. I do feel like our life on hold for 6months. Need to keep on straight and narrow though and then we!!!8217;ll be in better place.
    Always counting down to pay day, but making baby steps getting life on track! Looking forward to cracking the debt once and for all.
    • Mumoffourkids
    • By Mumoffourkids 3rd Jan 18, 6:31 PM
    • 618 Posts
    • 2,968 Thanks
    Mumoffourkids
    • #9
    • 3rd Jan 18, 6:31 PM
    • #9
    • 3rd Jan 18, 6:31 PM
    Hi, just read your diary and I think you should pay more off your debts just in case you can't get any more 0% deals. If you have a surplus of over £1200 why can't you pay half off your debt and put half into savings.

    What are your general savings going to be used for? Also I have six kids and save £150 per month for Christmas and birthdays. Unless you have a lot of other family to but for, £100 per month is probably slightly too high. I got told to reduce my Christmas and birthdays savings to £50 per month.

    I have more debts than you, but I have worked out that I can afford to pay £800 at least to my debts each month and that is with a healthy budget and still treating the kids.

    Good luck with your debt busting though.
    Total debt Dec 2017 £23090.83
    Ma7 2018 £4621.78 79.98% paid
    Emergency fund £100/£600
    Total Savings £1258.62
    • Storm89
    • By Storm89 3rd Jan 18, 6:34 PM
    • 491 Posts
    • 864 Thanks
    Storm89
    choccy I know how you feel. We now get disability allowance for my daughter but when we weren't getting it last year, all the things she needed or ruined we were using credit cards for. Like poo smearing on the carpet so we replaced the entire flooring in the house with vinyl. Then she got too big for her pushchair and we needed a special needs one but had no money to get it with. Then we also had car trouble like you but not as bad. Hubby had a bump in his car , a kid on a bike ran into him when he was stationary and we had to pay £400 excess to fix it. cos the lad was 15 we couldn't claim that back - so guess what? it went on the credit card same as everything else lol. I think putting your life on hold for 6 months is sensible to get the money you need together. Good luck!
    • Storm89
    • By Storm89 3rd Jan 18, 8:59 PM
    • 491 Posts
    • 864 Thanks
    Storm89
    sorry mumoffour I don't know why I didn't see your reply before. It's a Christmas and Birthdays fund so for birthday parties as well as presents and then christmas. I do have a big extended family and Christmas often catches up with me. The general savings are for emergencies and to have a cushion if anything happens like hubby loses his job etc - it's not likely to happen but would like an emergency savings fund. I did the eligibility calculator and got 100% pre-approved on quite a few cards so I think first step will be to see if we can get one of those. If we do get turned down then we'll reassess the plan. I think we should have an extra £200ish a month leftover after all those savings accounts and the £500 debt , unless anything else creeps up. So the plan is whatever is left over goes onto debt.
    Next year (although I don't want to be thinking too far ahead yet!) once we have a nice cushion savings fund of £3k and Very is paid off ; then I will increase debt repayments by £350 plus whatever is left at the end of the month. I do agree I shouldn't rely on getting 0% deals but if we manage to secure this one (that's 100% pre-approved) then we should be ok for the next 12 months.
    • fatrab
    • By fatrab 3rd Jan 18, 9:12 PM
    • 841 Posts
    • 1,961 Thanks
    fatrab
    Sorry, I thought you said in your original post that you were setting aside £500 per month for debt payment?


    If you have a surplus of almost £1300 per month surely it makes sense to pay off debts first? That's £15600 (almost all of your debt) in a year!


    Transfer as much of the debt as possible onto new 0% deals as soon as the current 0% periods end, either with existing or new cards. But with that amount of surplus and a bit of discipline you'll do this easily.


    Good luck
    Last edited by fatrab; 03-01-2018 at 9:15 PM.
    You can have results or excuses, but not both.
    May's targets - Lose 1 stone - 6lbs off, 25/31 AFDs, 15/18 lunches.
    37 x £2 coins (#32) - Wannabe debt free by Dec 2022
    • Storm89
    • By Storm89 3rd Jan 18, 9:32 PM
    • 491 Posts
    • 864 Thanks
    Storm89
    I'm going to transfer the smaller card with £1800 odd on , onto another existing card that is offering 0% for 12 months if we transfer before 31st January. Then I'll apply for another 0% card to shift the £6.5k off the card that ends in March.
    In terms of throwing all the money at the debt, that's something I would probably do if I didn't have 2 children to support. I'm just worried about not having any savings and the mess that got us into last year. We ended up using the credit card a lot and in the end are only £2k down on the overall debt. Started the year with over £18k debt and when things cropped up that we couldn't pay for we ended up paying on the card. Having a chunk of savings should avoid that. I think 2 years to pay it off plus still having money for christmas and birthdays, kids clothes and a little holiday in october should hopefully be ok. If I put £400 onto the card that ends in March, I just can't see how I could afford the other savings like Very, Center Parcs, Xmas etc. I needed to use Very because I had no savings, if I'd saved up I could have purchased the things myself. I know everyone does things differently though but I just don't want the kids to suffer for something which is ultimately my fault. I think I'll at least try this for 6 months and then if it isn't working will go a different way.
    • fatrab
    • By fatrab 4th Jan 18, 7:37 AM
    • 841 Posts
    • 1,961 Thanks
    fatrab
    So what happens if you get rejected for the new card in March? Or don't get a high enough credit limit to transfer the full amount? You can afford to pay off the £1800 card in full before the end of the 0% deal in June. That will be one less card and one less minimum monthly payment to make. You already have an existing card offering you £5100 which is most of the March card's balance. Personally I wouldn't be prepared to throw away 5 months of interest free time on the June card.

    Having an emergency fund is definitely a good idea. Build up somewhere between £1000 - £2000. I'm in the process of doing this too and have managed over £800 in 2 months (pretty much by cancelling Christmas! This wasn't an easy decision but more on that further down....).

    Having savings while you're in debt is generally not worth it in the long run unless you're earning super amounts of interest on the savings.

    I'm currently in a position where I have over £800 surplus. I have a few smaller debts to clear this year which will free up around another £300 per month. I'll add that to the £800 and focus on clearing a larger debt next year (another £400 per month). Then I'm putting it all into my mortgage.

    My wife and I have spoken to our immediate family and told them that for the next year or so Xmas, birthdays etc are on hold. When we explained why we were doing it they were both understanding and supportive. We have a newborn baby and I have an older child from a previous relationship. I want to be debt & mortgage free before my little one goes to school so that I can afford to find a job closer to home working less hours. I currently work away from home Monday to Friday.

    The way I see it, 1 year of sacrifice would pretty much solve your whole debt crisis.

    Then you have the rest of your lives debt free with plenty of spare cash because you'll never make the same mistakes you did in the past. I am filled with regret for my financial mistakes but now see a path that should clear things up within my timescale and means I can have a little bit of a life at the same time, just with not as much frivolous spending as I was used to.

    I will follow your diary and look forward to hearing about your successes soon!

    Best wishes,

    Robert
    Last edited by fatrab; 04-01-2018 at 7:40 AM.
    You can have results or excuses, but not both.
    May's targets - Lose 1 stone - 6lbs off, 25/31 AFDs, 15/18 lunches.
    37 x £2 coins (#32) - Wannabe debt free by Dec 2022
    • Storm89
    • By Storm89 4th Jan 18, 9:40 AM
    • 491 Posts
    • 864 Thanks
    Storm89
    That sounds very sensible and a good target for when little one starts school . None of our family know as we're so embarrassed to have gotten into this mess. The problem I'm having with creating the other savings accounts is that the things are already set in stone for example center parcs is already booked and I need to have the £600 by August. The first Very payment is due in May so I need to have I think £300 ? by then not sure I haven't checked today. The kids will probably need new clothes when it gets a bit warmer . Thankfully my eldest is slowing down a bit so I've managed to stretch out some of last years clothes and not needed to buy much for him . I got into such a mess last year with not keeping anything back each month and these are the things that sneaked up on us and in the end meant we got into more debt for it.
    I am aware we could wipe it off a lot sooner but I'm trying to play the long game so I've still got 'living' money & money for anything that might creep up. It's so disheartening paying chunks off debt and then needing to use the card again or get something from Very. I think I'll stick to my target of £500 a month plus the other savings and then anything leftover (around £250 if I'm careful) can also go on the debt. I actually think I can shift our balances amongst the cards we've already got so we're going to have a chat about that tonight. & then when the card runs out in November we will try and apply for another so we won't need as high a credit limit by then.
    I feel exactly the same regret and can't wait to be out of this mess. We made huge sacrifices last year and didn't go anywhere or eat out or basically do anything and still ended up in more debt because we had to do things like replace the carpet in the house and had no money to do so. Or when DH had a bump in the car we had to fork out the £400 excess on the card and won't get that back. Loads of things seemed to crop up and I think I'm just scarred by that so want to avoid it. If we can have paid it off by December 2019 then I'll be happy. We'll be 30 then and debt free which sounds good to me.
    • Storm89
    • By Storm89 4th Jan 18, 9:47 AM
    • 491 Posts
    • 864 Thanks
    Storm89
    Our aim for January is just to break even so I think we're on target to do that. Christmas was expensive and we had no savings for it . I suggested secret santa to family in desperation but it didn't get me anywhere so we had to fork out
    By February I am aiming to have
    • Got all money onto 0% for at least 12 months
    • Have £500 in savings to make up for the missed £250 in Jan
    • Have paid £500 off the debt
    • Met the targets for all the little savings accounts
    We discussed it last night and honestly feel like this is the way forward for us , it's going to mean balance transfer fees but then we can really start . If nothing major has crept up by Christmas , then we will probably use some of the savings to pay off more debt and reassess how we go into 2019.
    • Mumoffourkids
    • By Mumoffourkids 4th Jan 18, 10:40 AM
    • 618 Posts
    • 2,968 Thanks
    Mumoffourkids
    I would say having an emergency fund is a very good idea just in case something goes wrong as what happened to you last year.

    Maybe you could build up the emergency fund and then if you can't for whatever reason get a 0% deal you could when the others run out you could use some of the savings to clear the credit card. But not all of your emergency fund though.

    I totally get what you are saying about still having living money. In theory I could probably pay over £1000 off my debts each month if I didn't go on holiday (its only camping in Cornwall for a week though) or spent a lot less on the kids at Christmas and Birthdays and cut back on absolutely everything to a bare minimum. But I don't see why my kids should suffer for my mistakes. In addition even with paying off £800 a month, I will be debt free in two years. If it was a lot longer, then I probably would cut right back on everything.
    Total debt Dec 2017 £23090.83
    Ma7 2018 £4621.78 79.98% paid
    Emergency fund £100/£600
    Total Savings £1258.62
    • enthusiasticsaver
    • By enthusiasticsaver 4th Jan 18, 11:29 AM
    • 6,401 Posts
    • 13,163 Thanks
    enthusiasticsaver
    Surely if you can get a balance transfer for the card due up in March that would be £5100 of the £6330 transferred on to 0%? You could then use the bulk of the £500 allocated to debt to repay the remaining £1230 over the 3 months from January to March? Then target the one due in June. You will need to transfer the largest one as that will not be repaid by November.

    I think you are right to save alongside the debt repayments as this will hopefully avoid the spending on credit cards or catalogue spending in the future.
    Debt free and mortgage free and early retiree. Living the dream

    I'm a Board Guide on the Debt-Free Wannabe, Mortgages and Endowments, Banking and Budgeting boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Pease remember, board guides don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com
    • Storm89
    • By Storm89 4th Jan 18, 12:43 PM
    • 491 Posts
    • 864 Thanks
    Storm89
    Thanks for your comment enthusiastic, I'm thinking along those lines as you've suggested. It's an existing card that's offering me a 0% deal on £5100 so wouldn't even need to apply for another at the moment. Then like you say depending on minimum payments on the others I could try and throw most at the £1800 that's up in June. Then the one thats up in November, again like you say won't be paid by then. But I'm then thinking that if my existing cards aren't offering me any deals then I'll apply for another balance transfer card then. I think I'll have a better chance by November as debt will be much lower . Although I'm pretty sure once I pay off all the £6330 they'll offer me another deal to keep me so that's an option I can look at when the time comes. I'll need to work out what the minimum payments will be on the amounts transferred but it should work out well. I don't know for sure which way I'll do it because we will need to look at what we have left on available credit per card and what they'll offer us .

    I've definitely learned from not saving for things last year that's for certain. We had an awful year last year for lots of reasons . Not just financially but emotionally, I won't get too personal but it was just really really crap. Coupled with the fact we didn't go on holiday or pay off more than £2k debt over the whole year , I just have a different outlook on it now and think saving for holidays , clothes etc alongside debt repayments is the right way to go.

    I looked at snowballing and it said 42 months to be debt free but no way am I going to still be saddled for that long. I am so determined that Dec 2019 I'll be done with it all.
    • Storm89
    • By Storm89 4th Jan 18, 12:48 PM
    • 491 Posts
    • 864 Thanks
    Storm89
    mumoffour I am going to be debt free in 2 years as well, so we have similar targets I feel exactly the same, I don't feel my kids should suffer for our mistakes. When I think of everything they could have if we weren't in debt, bigger house , more holidays etc, it makes me determined to get it for them by paying off the debt. In the meantime, I want them to still be able to have some luxuries like their extra curriculars that they're used to. We'll take a little holiday in October and in the meantime we'll do lots of free activities , walks, play in the garden etc. & I'll still have money for their christmas and birthdays .
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