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  • FIRST POST
    • ambitiouspanda
    • By ambitiouspanda 10th Mar 18, 10:57 AM
    • 58Posts
    • 39Thanks
    ambitiouspanda
    How can I stop living pay to pay cheque?
    • #1
    • 10th Mar 18, 10:57 AM
    How can I stop living pay to pay cheque? 10th Mar 18 at 10:57 AM
    Hi, I am 24 and I want to stop living pay to pay cheque.

    I always pay my expenses which currently are as follows:

    Income: £2583.94

    Debt: £3699 - credit card bills. The 0% interest is coming off in April 2018.

    Expenses (I live in London):
    Rent: £757.33
    Bills: £88
    Oyster: £153.60
    Therapy: £50
    Phone bill: £13
    Nails: £66
    Hair: £70
    Food: £130
    Tithe: £258.79
    Credit card repayment: £921.87 (my chosen amount)

    Left over to cover me until next pay is £94-100 (4 weeks)

    I pay so much for my credit card bill to rid myself of the debt. Especially because the 0% interest is coming to an end in April. The debt was much higher before and Iíve managed to pay it down. I got it to help myself out in a difficult period and assist a family member. My goal is to clear my cc bills by May. I know it seems like a no brainier but even when I didnít have debt I found that I still lived pay to pay. It is so embarrassing! At the moment I have £20 in my account to carry me to my next pay day (which is in 5 days)...

    Any advice would be useful!
    Left over:
    **2018 G O A L S**
    1) Save £3000-4000!
Page 1
    • Alexland
    • By Alexland 10th Mar 18, 10:59 AM
    • 2,389 Posts
    • 1,791 Thanks
    Alexland
    • #2
    • 10th Mar 18, 10:59 AM
    • #2
    • 10th Mar 18, 10:59 AM
    Most obvious candidate to explore on that list is £66 for nails and £70 on hair? I won't comment on the therapy as I don't know your circumstances and the tithe is a personal choice.

    Are you making enough pension contributions to get maximum employer matching? Once you have paid back the CC and saved an emergency fund are you aware there is government help towards saving to buy a property with a HTB ISA or Lifetime ISA?
    Last edited by Alexland; 10-03-2018 at 11:05 AM.
    • chucknorris
    • By chucknorris 10th Mar 18, 11:08 AM
    • 9,567 Posts
    • 14,352 Thanks
    chucknorris
    • #3
    • 10th Mar 18, 11:08 AM
    • #3
    • 10th Mar 18, 11:08 AM
    Hi, I am 24 and I want to stop living pay to pay cheque.

    I always pay my expenses which currently are as follows:

    Income: £2583.94

    Debt: £3699 - credit card bills. The 0% interest is coming off in April 2018.

    Expenses (I live in London):
    Rent: £757.33
    Bills: £88
    Oyster: £153.60
    Therapy: £50
    Phone bill: £13
    Nails: £66
    Hair: £70
    Food: £130
    Tithe: £258.79
    Credit card repayment: £921.87 (my chosen amount)

    Left over to cover me until next pay is £94-100 (4 weeks)

    I pay so much for my credit card bill to rid myself of the debt. Especially because the 0% interest is coming to an end in April. The debt was much higher before and Iíve managed to pay it down. I got it to help myself out in a difficult period and assist a family member. My goal is to clear my cc bills by May. I know it seems like a no brainier but even when I didnít have debt I found that I still lived pay to pay. It is so embarrassing! At the moment I have £20 in my account to carry me to my next pay day (which is in 5 days)...

    Any advice would be useful!
    Left over:
    Originally posted by ambitiouspanda
    I had to google 'Tithe', I didn't know what it was. Wouldn't it be more sensible to stop contributing that until your debt falls to zero, then maybe switch to 10% of your remaining monthly income after paying all living expenses (rather than 10% of your income).
    Chuck Norris can kill two stones with one bird
    The only time Chuck Norris was wrong was when he thought he had made a mistake
    Chuck Norris puts the "laughter" in "manslaughter".
    After running injuries I now mostly hike, gym classes and weight training (also a bit of cycling and swimming), less impact on my joints.
    • ambitiouspanda
    • By ambitiouspanda 10th Mar 18, 11:28 AM
    • 58 Posts
    • 39 Thanks
    ambitiouspanda
    • #4
    • 10th Mar 18, 11:28 AM
    • #4
    • 10th Mar 18, 11:28 AM
    Most obvious candidate to explore on that list is £66 for nails and £70 on hair? I won't comment on the therapy as I don't know your circumstances and the tithe is a personal choice.

    Are you making enough pension contributions to get maximum employer matching? Once you have paid back the CC and saved an emergency fund are you aware there is government help towards saving to buy a property with a HTB ISA or Lifetime ISA?
    Originally posted by Alexland
    Yes, I know the hair and nails seems excessive but it actually isnít. I have long thick curly hair that requires professional assistance. In regards to my nails it is my guilty pleasure and helps for work.

    My employer doesnít match any contributions made but offers 7.5%. I wonít make any contributions until my cc bills are paid... then I am going to really do it! That aside, do you have any other comments on how I can save more etc?
    **2018 G O A L S**
    1) Save £3000-4000!
    • eskbanker
    • By eskbanker 10th Mar 18, 11:29 AM
    • 7,167 Posts
    • 7,617 Thanks
    eskbanker
    • #5
    • 10th Mar 18, 11:29 AM
    • #5
    • 10th Mar 18, 11:29 AM
    My goal is to clear my cc bills by May.
    Originally posted by ambitiouspanda
    If you owe £3699 and are repaying £921.87 monthly then that would take four more months at that rate, and if the 0% expires next month then there will obviously be interest to be added from then too, unless you're able to balance transfer to another 0% card.

    It's generally a good idea to pay down debt but obviously to do so at an accelerated rate leaves you little room for manoeuvre while doing so - the flip side is that once the debt is paid off then you'll suddenly have £921.87 of disposable income that should transform your finances and allow you to achieve the goal in your signature.
    • ambitiouspanda
    • By ambitiouspanda 10th Mar 18, 11:31 AM
    • 58 Posts
    • 39 Thanks
    ambitiouspanda
    • #6
    • 10th Mar 18, 11:31 AM
    • #6
    • 10th Mar 18, 11:31 AM
    I had to google 'Tithe', I didn't know what it was. Wouldn't it be more sensible to stop contributing that until your debt falls to zero, then maybe switch to 10% of your remaining monthly income after paying all living expenses (rather than 10% of your income).
    Originally posted by chucknorris
    Yes, I agree with that!!! Completely! I can even tithe 10% on my left over!

    Do you have any other comments on my expenses etc? I really want to save more money and pay my cc bills quickly.
    **2018 G O A L S**
    1) Save £3000-4000!
    • YorkshireBoy
    • By YorkshireBoy 10th Mar 18, 11:39 AM
    • 30,152 Posts
    • 18,004 Thanks
    YorkshireBoy
    • #7
    • 10th Mar 18, 11:39 AM
    • #7
    • 10th Mar 18, 11:39 AM
    My employer doesnít match any contributions made but offers 7.5%. I wonít make any contributions until my cc bills are paid... then I am going to really do it!
    Originally posted by ambitiouspanda
    I'd BT the credit card debt personally, to a long term 0% deal fee-free. I'd then pay the minimum on that, whilst using the significant freed up cash to bolster my emergency savings fund and make pension contributions.


    I'd also be looking to increase my income, because otherwise you'll be paying nearly a third of your income in rent forever!
    That aside, do you have any other comments on how I can save more etc?
    No, at least not with what you've posted. You're looking at a quid here and a quid there. So concentrate on increasing your income.
    • chucknorris
    • By chucknorris 10th Mar 18, 11:42 AM
    • 9,567 Posts
    • 14,352 Thanks
    chucknorris
    • #8
    • 10th Mar 18, 11:42 AM
    • #8
    • 10th Mar 18, 11:42 AM
    Yes, I agree with that!!! Completely! I can even tithe 10% on my left over!

    Do you have any other comments on my expenses etc? I really want to save more money and pay my cc bills quickly.
    Originally posted by ambitiouspanda
    I'm a bloke, so not the right person to talk about hair and nails costs, have you considered trying to increase your income, in addition to reducing expenses.
    Chuck Norris can kill two stones with one bird
    The only time Chuck Norris was wrong was when he thought he had made a mistake
    Chuck Norris puts the "laughter" in "manslaughter".
    After running injuries I now mostly hike, gym classes and weight training (also a bit of cycling and swimming), less impact on my joints.
    • pearl123
    • By pearl123 10th Mar 18, 11:46 AM
    • 1,379 Posts
    • 2,065 Thanks
    pearl123
    • #9
    • 10th Mar 18, 11:46 AM
    • #9
    • 10th Mar 18, 11:46 AM
    Can you explain what is Tithe? I suggest you do your own nails and use a training school to get your hair cut.
    Re therapy if itís something that is professional and crucial for your mental health then of course continue. If it is some new age Mumbo jumbo knock it on a head too.
    Adittionally, your food costs are rather high for one person.
    • ambitiouspanda
    • By ambitiouspanda 10th Mar 18, 11:57 AM
    • 58 Posts
    • 39 Thanks
    ambitiouspanda
    If you owe £3699 and are repaying £921.87 monthly then that would take four more months at that rate, and if the 0% expires next month then there will obviously be interest to be added from then too, unless you're able to balance transfer to another 0% card.

    It's generally a good idea to pay down debt but obviously to do so at an accelerated rate leaves you little room for manoeuvre while doing so - the flip side is that once the debt is paid off then you'll suddenly have £921.87 of disposable income that should transform your finances and allow you to achieve the goal in your signature.
    Originally posted by eskbanker
    I have £1000 from a bonus so I would be on schedule to pay it all off by May... fingers crossed!
    **2018 G O A L S**
    1) Save £3000-4000!
    • ambitiouspanda
    • By ambitiouspanda 10th Mar 18, 12:01 PM
    • 58 Posts
    • 39 Thanks
    ambitiouspanda
    Can you explain what is Tithe? I suggest you do your own nails and use a training school to get your hair cut.
    Re therapy if itís something that is professional and crucial for your mental health then of course continue. If it is some new age Mumbo jumbo knock it on a head too.
    Adittionally, your food costs are rather high for one person.
    Originally posted by pearl123
    Tithe is 10% in my net income I pay to church. Iím a Christian. Following the advice of another poster I will tithe 10% on my left over money until my cc bills are paid. Yes, I will probably start doing my own hair and nails etc. Thank you so much!
    **2018 G O A L S**
    1) Save £3000-4000!
    • Robster88
    • By Robster88 10th Mar 18, 12:07 PM
    • 75 Posts
    • 27 Thanks
    Robster88
    I'd immediately stop the tithe. If you wan't to give back once you are able to afford to then that's laudable, but I don't think it is sensible to give away 10% of your income when you're in debt.

    £66 a month on nails sounds excessive. You say it is a guilty pleasure, but I think you need to consider where your priorities lie. If you are really keen on cutting your debt more quickly, getting your nails done less frequently would be an achievable way to help with that.

    Do you not have to pay council tax, or is that included in rent?
    • Flobberchops
    • By Flobberchops 10th Mar 18, 12:31 PM
    • 726 Posts
    • 524 Thanks
    Flobberchops
    (For Pearl123 - I believe Tithing is a 10% donation some people choose to make on religious grounds) [edit - crossposted several times!]

    Ambitiouspanda - I think the first issue is that you don't seem to have any emergency savings. Clearing debt ASAP is a noble goal but what if between now and June (when your finances have recovered) you need emergency dental treatment, or you sit on your glasses, or the fridge breaks? Your £100 disposable income may not cut it, and even if it did that would leave you incredibly stretched.

    The £3700 CC debt that you're about to start paying interest on is important, but you may be able to kick that problem down the road a little. YorkshireBoy already mentioned a balance transfer to another card with a 0% period which would take the pressure off you for a few more months. Whether you can find a provider willing to take on that amount of debt is another question; if you're not able to transfer all your CC debt this way you might consider a personal loan to restructure the remaining debt. A loan isn't an ideal solution either but if you can repay your debt at a rate of 10% or less (fairly average for a bank loan) as opposed to the 20-30% you're probably paying on your cards, that's the lesser of two evils. It may also bring down your monthly repayment figure, leaving you with a bit more cash in your pocket. You can generally make early repayment to clear the debt when you're able, but be aware there may be an early settlement fee - read the Ts&Cs carefully, do the maths and see whether it would help you.

    I'm a Londoner too and that Oyster figure seems very high. Most people I know who buy a monthly pass, even in Zone 1, don't tend to spend more than £80 a month. Are you sure you couldn't reduce that expense?

    I perceive most of the other expenses as either essential (rent, bills) or non-negotiable lifestyle choices (hair, tithing) so there's maybe not too much fat to trim there. You could probably get your food bill down to £100 or less if you completely cut out buying sandwiches, coffees etc and make a commitment to bulk-cook on a budget at home. Plenty of online resources will tell you how to do this!

    In summary, what really rings alarm bells in my head is that amount of Credit Card debt and the rate you're paying it off, I think it's putting you in a position where you'll be very vulnerable to even quite minor emergencies (and come April when the interest kicks in the expense will be even greater). So, please do consider ways to extend the 0% period or restructure the debt in a way that is more affordable.

    In the longer term - once you've 1) built an emergency fund of at least £1000 and 2) cleared your debts - I think you should follow the principle of paying yourself first. Because you do tithing this is actually a habit you already follow! In addition to earmarking 10% of your income for charity, why not allocate 10% (or more) for your own savings. Unsuccessful savers tend to spend the money they earn, and then save what's left, which is often very little or nothing. A better way is to save first (set up a standing order the day you get paid so it's automatic and prioritised) and then spend what's left.

    Beyond that it really comes down to what your personal goals and circumstances are. If you can afford to invest in stocks (cheap funds, through an ISA) or contribute to a workplace pension those are normally good ideas. Planning on buying a house? Look into Help To Buy or Lifetime ISAs. Do you have large purchases planned, or a holiday coming up? Consider the "piggybanking" method where you set up a separate savings account for each goal and dripfeed in each month as part of your main savings. Keep your goals concrete and trackable rather than vague aspirations - so, not "I want to go on holiday in the next couple of years" but "By January 2020 I will have saved £2000 to go to Australia. I will achieve this by saving £100 a month". "A goal without a plan is just a wish", that's my motto!
    I work for a UK bank, but any comments made on this forum are solely my personal opinion. Caveat Emptor!
    • PeacefulWaters
    • By PeacefulWaters 10th Mar 18, 12:34 PM
    • 8,320 Posts
    • 10,638 Thanks
    PeacefulWaters
    or the fridge breaks?
    I read that as "fringe".
    • TheTracker
    • By TheTracker 10th Mar 18, 12:42 PM
    • 1,213 Posts
    • 1,197 Thanks
    TheTracker
    I remember learning about tithes in school. I had not realised the practise continued beyond the medieval age, so have spent an illuminating 20 minutes reading about it. My first thought was you could tithe time but apparently that insinuates the other 90% of time is ungodly. Whereas if you tithe no time, you can be safe that 100% is godly. Religious logic, awesome.

    Apparently, according to tithe-friendly websites, the 10% is due before income tax, but you seem to be paying 10% after income tax. Maybe you need to up your tithe to what appears to be expected? Are you paying enough tithe? In another thread you say you earn £45k, so I figure you need to be contributing £375 not £259 per month in tithe. If you don't believe in that doctrine of pre-tax tithe, perhaps you can forgo some of the cash based contribution and contribution time instead.

    This may sound like a harsh naive forum member, but it is a simple summary of what I just read about on the subject. I do have personal views on the subject but as this is a financial forum I will stick to those aspects.
    Last edited by TheTracker; 10-03-2018 at 4:47 PM.
    • John-K
    • By John-K 10th Mar 18, 1:10 PM
    • 654 Posts
    • 1,011 Thanks
    John-K
    Yes, I know the hair and nails seems excessive but it actually isnít. I have long thick curly hair that requires professional assistance. In regards to my nails it is my guilty pleasure and helps for work.

    My employer doesnít match any contributions made but offers 7.5%. I wonít make any contributions until my cc bills are paid... then I am going to really do it! That aside, do you have any other comments on how I can save more etc?
    Originally posted by ambitiouspanda
    So, in essence, you will not give up the expensive luxuries. What, exactly, are hoping to hear instead?

    To put it simply, you do not earn very much, and you are choosing to spend it on fripperies, so you do not have any money left over. No advice in the world will change this.

    That being the case, maybe up-skill to be able to earn more?
    • John-K
    • By John-K 10th Mar 18, 1:17 PM
    • 654 Posts
    • 1,011 Thanks
    John-K
    I remember learning about tithes in school. I had not realised the practise continued beyond the medieval age, so have spent an illuminating 20 minutes reading about it. My first thought was you could tithe time but apparently that insinuates the other 90% of time is ungodly.
    Originally posted by TheTracker
    It really is a racket. A very rich organisation tells people that they are immoral if they do not hand over all of their spare cash, and insinuates torture at a later date.

    And people still fall for it.

    Hereís a pr!cis of the deal...

    http://jhuger.com/kissing-hanks-!!!
    • rathernot
    • By rathernot 10th Mar 18, 1:18 PM
    • 256 Posts
    • 72 Thanks
    rathernot
    Hi, I am 24 and I want to stop living pay to pay cheque.

    I always pay my expenses which currently are as follows:

    Income: £2583.94

    Debt: £3699 - credit card bills. The 0% interest is coming off in April 2018.

    Expenses (I live in London):
    Rent: £757.33
    Bills: £88
    Oyster: £153.60
    Therapy: £50
    Phone bill: £13
    Nails: £66
    Hair: £70
    Food: £130
    Tithe: £258.79
    Credit card repayment: £921.87 (my chosen amount)

    Left over to cover me until next pay is £94-100 (4 weeks)

    I pay so much for my credit card bill to rid myself of the debt. Especially because the 0% interest is coming to an end in April. The debt was much higher before and Iíve managed to pay it down. I got it to help myself out in a difficult period and assist a family member. My goal is to clear my cc bills by May. I know it seems like a no brainier but even when I didnít have debt I found that I still lived pay to pay. It is so embarrassing! At the moment I have £20 in my account to carry me to my next pay day (which is in 5 days)...

    Any advice would be useful!
    Left over:
    Originally posted by ambitiouspanda
    This isn't going to sound helpful but frankly you don't need to be asking this on a savings forum you just need to use some common sense about things.
    • Walk
    • Don't get your nails done as often
    • Don't get your hair done as often
    • Eat less or buy cheaper food
    • Don't pay tithe
    • Pay more or less on the credit card so be out of debit quicker or in debt longer and have some money left each month sooner or later

    There's nothing revolutionary about any of that and if you're going to say "But I have really awkward hair and I have to pay tithe" it perhaps shows where you priorities really are.
    • Alexland
    • By Alexland 10th Mar 18, 1:20 PM
    • 2,389 Posts
    • 1,791 Thanks
    Alexland
    Apparently the 10% is due before income tax, but you seem to be paying 10% after income tax. Maybe you need to up your tithe to what appears to be expected? Are you paying enough tithe?
    Originally posted by TheTracker
    But there is a question of if 10% is still a relevant contribution level given some services the church used to provide have moved across to government so are covered from taxation and national insurance.
    • ambitiouspanda
    • By ambitiouspanda 10th Mar 18, 1:44 PM
    • 58 Posts
    • 39 Thanks
    ambitiouspanda
    (For Pearl123 - I believe Tithing is a 10% donation some people choose to make on religious grounds) [edit - crossposted several times!]

    Ambitiouspanda - I think the first issue is that you don't seem to have any emergency savings. Clearing debt ASAP is a noble goal but what if between now and June (when your finances have recovered) you need emergency dental treatment, or you sit on your glasses, or the fridge breaks? Your £100 disposable income may not cut it, and even if it did that would leave you incredibly stretched.

    The £3700 CC debt that you're about to start paying interest on is important, but you may be able to kick that problem down the road a little. YorkshireBoy already mentioned a balance transfer to another card with a 0% period which would take the pressure off you for a few more months. Whether you can find a provider willing to take on that amount of debt is another question; if you're not able to transfer all your CC debt this way you might consider a personal loan to restructure the remaining debt. A loan isn't an ideal solution either but if you can repay your debt at a rate of 10% or less (fairly average for a bank loan) as opposed to the 20-30% you're probably paying on your cards, that's the lesser of two evils. It may also bring down your monthly repayment figure, leaving you with a bit more cash in your pocket. You can generally make early repayment to clear the debt when you're able, but be aware there may be an early settlement fee - read the Ts&Cs carefully, do the maths and see whether it would help you.

    I'm a Londoner too and that Oyster figure seems very high. Most people I know who buy a monthly pass, even in Zone 1, don't tend to spend more than £80 a month. Are you sure you couldn't reduce that expense?

    I perceive most of the other expenses as either essential (rent, bills) or non-negotiable lifestyle choices (hair, tithing) so there's maybe not too much fat to trim there. You could probably get your food bill down to £100 or less if you completely cut out buying sandwiches, coffees etc and make a commitment to bulk-cook on a budget at home. Plenty of online resources will tell you how to do this!

    In summary, what really rings alarm bells in my head is that amount of Credit Card debt and the rate you're paying it off, I think it's putting you in a position where you'll be very vulnerable to even quite minor emergencies (and come April when the interest kicks in the expense will be even greater). So, please do consider ways to extend the 0% period or restructure the debt in a way that is more affordable.

    In the longer term - once you've 1) built an emergency fund of at least £1000 and 2) cleared your debts - I think you should follow the principle of paying yourself first. Because you do tithing this is actually a habit you already follow! In addition to earmarking 10% of your income for charity, why not allocate 10% (or more) for your own savings. Unsuccessful savers tend to spend the money they earn, and then save what's left, which is often very little or nothing. A better way is to save first (set up a standing order the day you get paid so it's automatic and prioritised) and then spend what's left.

    Beyond that it really comes down to what your personal goals and circumstances are. If you can afford to invest in stocks (cheap funds, through an ISA) or contribute to a workplace pension those are normally good ideas. Planning on buying a house? Look into Help To Buy or Lifetime ISAs. Do you have large purchases planned, or a holiday coming up? Consider the "piggybanking" method where you set up a separate savings account for each goal and dripfeed in each month as part of your main savings. Keep your goals concrete and trackable rather than vague aspirations - so, not "I want to go on holiday in the next couple of years" but "By January 2020 I will have saved £2000 to go to Australia. I will achieve this by saving £100 a month". "A goal without a plan is just a wish", that's my motto!
    Originally posted by Flobberchops
    Hello, thank you so much for such a detailed response. I will take much of this on board and apply it.

    My Oyster card is expensive because I live in zone 1, my work isnít in zone 2 and my family are in zone 3. So I buy a monthly pass for zones 1-3.

    If I save my tithe money. Iíll have £300+ left over. I can save £200 and by the time I pay off my cc bills Iíll have £600 saved. Then I can begin aggressive savings etc.

    I agree. My food can go down to £100. I just chucked an extra £5 to over can extra expenses etc...

    I am going to call Barclays (my cc card) and see if they can extend my cc promotional period by 1-2 months. That should swerve any unexpected costs when repaying the loan.

    Thank you for your input. Iíll be in touch again.
    **2018 G O A L S**
    1) Save £3000-4000!
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