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  • FIRST POST
    • Moguline
    • By Moguline 1st Jun 18, 2:04 PM
    • 325Posts
    • 970Thanks
    Moguline
    From debt mess to mortgage success in 5 years (hopefully!)
    • #1
    • 1st Jun 18, 2:04 PM
    From debt mess to mortgage success in 5 years (hopefully!) 1st Jun 18 at 2:04 PM
    Hi everyone,

    I've been lurking for a while and thought I'd start my own DFD to keep myself accountable.

    I'm 34, my husband is 35. We have a nearly 4-yr old son. We live in a rented house and have zero savings, and quite a lot of debt. It was years of me overspending obliviously (I blame my upbringing, my parents have always spent every single penny they've earned and I just sort of thought it was normal to always be skint). I started by getting a credit card, then shifting that to a 0% balance transfer card, then kept spending on the old card. Rinse and repeat for years and years. It just plodded along with me making minimum payments. Then, at the end of last year, all my 0% balance transfer windows ran out at the same time, and I wasn't eligible for any more 0% transfer cards. That's when I woke up and started looking into what I can do about it. I had resigned myself to the fact that I'll never have a mortgage and will be poor in retirement. I started looking around the internet for advice on how to handle debt, thinking I may be able to slowly reduce it a bit, and found an article called "News Flash: Your Debt is an Emergency!!" by Mr Money Mustache.

    It was a real reality check for me, but also gave me hope that even on a modest income, I could make massive changes to my lifestyle and thus become "well off".

    I owned up to my husband, who was unaware of the extent of my debt, and started properly reviewing our finances and budgeting.

    I started in January with a grand total of 23786 in unsecured debt. We have already been able to pay off quite a bit. I have consolidated my overdraft and most of my credit card debt into two loans. The interest rate on those is still quite high, as my credit rating is not amazing, but it's less than half the interest to what it was before, so it's a start. I also like the predictability of loan payments.

    Anyway, our goals are now:
    - Debt-free by end of 2019
    - Save a deposit and buy house by 2022
    - Mortgage-free by 2030
    - Retire before 60 (2044)

    Once the debt is cleared, we are planning on using our new-found frugality to learn how to live within 50% of our income, giving us leverage to save up a decent deposit quickly, then subsequently overpaying on our mortgage, then aggressively saving and investing with a view to early retirement. (we also have private pensions through our jobs which are both pretty decent and can be paid out from age 55).

    SOA and all other info in first comment below.

    Any criticism/advice gratefully received!
    Last edited by Moguline; 04-06-2018 at 9:22 PM. Reason: Moved SOA etc into first comment in thread so that the initial post isn't quite so long!
Page 15
    • Moguline
    • By Moguline 21st Aug 18, 10:57 AM
    • 325 Posts
    • 970 Thanks
    Moguline
    Right, it's been a while since I updated this properly - been a hectic week!

    We had a lovely time for mine and Spud's birthdays - went for a lovely meal, went swimming, had a great picnic in the park party. My mum paid for a lot of it, so came out fairly unscathed financially.

    However, Spud got chickenpox literally half an hour before his birthday party which majorly sucked. We told our friends but pretty much all their kids have already had it, so they all came anyway. Spud was fine on the day, but really took a turn for the worse that night and is now completely covered in them, poor lamb. The GP said it's the most "impressive" case he's seen in well over a decade.
    So neither of us have really slept since Saturday and OH and I are taking turns staying at home to avoid cabin fever! I've also spent a fortune on a wagon load of antihistamines, lotions, painkillers etc. Hoping that he'll turn a corner soon, hate seeing him this upset and not being able to help him!

    To top things off, I got stuck in the lift at work yesterday for about 20 minutes and then had to climb out ungracefully while all my concerned co-workers looked on. The ridiculousness that is my life continues haha!

    Financially, things are ok. I'm waiting on some birthday money from my dad to come through into my account, should be in today or tomorrow. Half of it will go towards replacing funds in my depleted savings account, the other half will go into a Junior Cash ISA for Spud which I set up for him yesterday. He got so many presents, he doesn't need anything else right now. It feels good finally starting to set up something for his financial future. This ISA is one that we can't touch until he's 18, and I'm planning on sticking any birthday/Christmas money he gets into it for him.

    I'll also set up a regular saver for him soon as the interest rate there is so much better! I'll start with a token tenner a month for now - will still add up to around 3,000 by the time he's 18, so not to be sniffed at! I'll increase contributions once we're a bit more financially stable.

    My 75 amazon voucher from my life insurance policy has come through now which is great. Together with vouchers from survey sites, I now have 79 sitting in there. I'm planning to use this towards birthday presents over the next couple of months, as well as for Christmas. It's nice to know there's a little wedge in there.

    I get paid on Friday and I still have 30 in my account and 45 in my pocket, with nothing else to come out other than a little top up shop (and Slimming World tonight), so I'm pleased with that. I've also put a couple of quid in my sealed pot for Christmas last week.

    I've amended my childcare vouchers too so from September onwards, I'll only take out 100 a month instead of the full 243. OH has decreased to 50/ This will increase our net salaries a little bit which is welcome. It'll also more than cover Spud's after school club - with some money spare to go towards holiday childcare when needed.

    I'm feeling like we're taking more and more steps towards being more financially responsible - progress might be slow, but it's constant, and that's great.
    LBM: Christmas 2017 Current debt, as of 01/11/2018: 22,079.76 Total reduction so far: -4,854.54 DFD of my dreams: 31/12/2020
    • Gemsy81
    • By Gemsy81 21st Aug 18, 4:47 PM
    • 182 Posts
    • 590 Thanks
    Gemsy81
    Hi Gemsy, thanks for checking in and congratulations on your pregnancy!! That's so exciting!
    Yeah, I definitely need a couple of fillings, but I'm not in pain or anything so it's not super urgent right now.
    Originally posted by Moguline
    Thank you so much moguline! I have a filling that I'm booked in for later this year now, so looking forward (if that's the right way to describe the dentist) to that freebie!

    Hope your LO is feeling better!
    • mark88man
    • By mark88man 21st Aug 18, 11:27 PM
    • 3,296 Posts
    • 6,890 Thanks
    mark88man
    My OH swore by porridge oats for chicken pox. something like you soak them in a stocking or pop up sock, and then use the juice to soothe the pox


    seemed to work a treat and v.cheap. medical opinion may vary!!
    Things happen for a reason. Often the reason is we are stupid & make bad decisions.
    Weight - Fluctuating - less than I was more than I should be
    1/18: CC:11.5K@0% - Car Loan:17K@2.8% - Mort:145K@2.9%
    Decrease in Total Debt 2016:13.4K 2017:8.3K 2018-1H:11K
    • Moguline
    • By Moguline 22nd Aug 18, 10:36 AM
    • 325 Posts
    • 970 Thanks
    Moguline
    Thanks mark88man, we've tried bathing him in it, but seeing his body covered in spots just made him freak out so baths were all but 2 minutes long haha. Dabbing of any kind was also traumatic. Thankfully, he seems to have turned a corner now - all his blisters have scabbed over so it looks worse, but feels a bit better.
    LBM: Christmas 2017 Current debt, as of 01/11/2018: 22,079.76 Total reduction so far: -4,854.54 DFD of my dreams: 31/12/2020
    • Moguline
    • By Moguline 22nd Aug 18, 5:10 PM
    • 325 Posts
    • 970 Thanks
    Moguline
    Had a sit down with the husband today and worked out our new budget with lower childcare costs etc. We've decided we'll do a budget every month now and then decide how much he gives me on a monthly basis based on that.

    Priority for now is paying for my citizenship, then his loan, then mine. Feels good being organised adults!

    We also looked at the Christmas budget so we can start planning for that. We think 550 should cover everything from work secret Santa to presents to parties and extra groceries. Although OH thinks 100 in presents isn't enough for Spud - I think it's a lot! But that's the difference of me being from a communist country and him having had 250 worth of presents every year in his childhood haha.
    I've now got 81 worth of Amazon vouchers to help with this, and hopefully the sealed pot will help with the extra Christmas groceries. I've put around 5 in change in there again today.

    I now have 5 in change left, as well as 25 in my account, and get paid on Friday. Going to Aldi later to do a little food shop as have run out of all fruit and veg it seems!
    Last edited by Moguline; 22-08-2018 at 5:19 PM.
    LBM: Christmas 2017 Current debt, as of 01/11/2018: 22,079.76 Total reduction so far: -4,854.54 DFD of my dreams: 31/12/2020
    • DancingUnicorn
    • By DancingUnicorn 22nd Aug 18, 6:11 PM
    • 174 Posts
    • 646 Thanks
    DancingUnicorn
    Hi, if your LO is still into running have you looked if there is a junior parkrun near you? I do the adult one but I hear the kids one is great. It's free, a good chance to socialise and burn some energy.
    Sounds like you're doing great on your debt-busting - keep going!
    LBM: October 2016: 20,130 / Current: October 2018: 15,037 25.03%
    DFD: February 2024 April 2022
    SPC#577 (2017: 60.58)
    • Moguline
    • By Moguline 25th Aug 18, 8:44 AM
    • 325 Posts
    • 970 Thanks
    Moguline
    Thanks Dancing unicorn. Our nearest kids park run is half an hour away by car sadly (and we don't have a car, so more like an hour on public transport), but something to consider in the future if he keeps bring interested in running.
    LBM: Christmas 2017 Current debt, as of 01/11/2018: 22,079.76 Total reduction so far: -4,854.54 DFD of my dreams: 31/12/2020
    • Gemsy81
    • By Gemsy81 30th Aug 18, 8:17 PM
    • 182 Posts
    • 590 Thanks
    Gemsy81
    I'm with you on the presents Moguline! My OH would spend loads, but I actually think its far more important they learn the value of money and 'things' rather than get showered with presents. I don't know about you, but I find at this age they get so many presents from everyone else, they already have loads!
    • Moguline
    • By Moguline 9th Nov 18, 11:55 AM
    • 325 Posts
    • 970 Thanks
    Moguline
    Hello MSEers. It’s been a long time! Time to come clean and move on haha.

    I’m still here, just plodding along. We’ve had a bit of time off with the hardcore debt repayments and only repaid the minimum loan payments these last couple of months.

    We’ve been really bad for having takeaways and lunches out, buying “treats”, etc. I think the problem is that we tied our belts a bit too tightly and ended up splurging.

    We have decided to up our grocery budget quite a bit. We can cope on 200 a month that we had before, but we want to focus more on fresh and organic food for health reasons. So now we get an organic veg box from a local farm (which is really good value) for 20 a week, plus have an additional 250 in our grocery budget for other groceries. This allows me to get fancy things we want like avocados, nut butters, medjool dates, etc. I’ve stocked the store cupboard with heaps of organic grains, pulses, nuts, etc. so hoping to get back into meal planning and trying to work the budget backwards from there where possible.

    Our debt total is now 22,079.76. It seems high, but that’s because all the interest in my Tesco loan is included from the start. That’s why I’ve removed the original total from my signature as it’s a bit meaningless now. We have, however, paid off a total of 4854.54 this year so far which is not to be sniffed at!

    In other good news, my Experian credit rating is now up to 975/Excellent! I never thought I’d see the day haha. I started with 620/Poor in February, so this a huge improvement, and is promising for when we eventually apply for a mortgage. I’m enjoying the peace of mind of just having loans and not having to keep up with credit card payments, etc.

    Saying that, I have actually paid something with the credit card today. I needed root canal treatment and a crown (ugh) and had to pay out around 380 (as I didn’t want a cheaper metal crown). I do have dental insurance through work though and will get 80% of it back, which I’ll pay straight off it as soon as I get the cheque. Then I’ll pay the remaining balance off at payday.

    I haven’t made much progress on the citizenship front as we’ve been oohing and ahing about whether to do it or not. We have decided to go for it now though. We’re getting 1,000 off my husband’s grandparents next month from an investment of theirs, and we’re going to use it for a couple of things we need (like winter boots), and then split the rest between overpayment on the husband’s loan and the citizenship fund.

    I also got around 1250 in Christmas bonus last year, so hoping for a repeat this year – that would pretty much cover all of the citizenship costs!

    Spud started school in September and it’s going really well. It’s a lovely school and they do lots of extra bits like yoga, healthy cookery, bike lessons etc. He really is enjoying it. We also save quite a bit of money now that we only have to pay 6 a day for after school club – goodbye nursery fees!

    What else is new? We just switched broadband to Vodafone as our original cheap Plusnet deal had finished. We now pay less and get double the speed – yay! I should also get a 75 amazon voucher for signing up – hopefully that’ll come through before Christmas, that would be useful.

    Spud wants a learning laptop for Christmas which is only 25 new, so that’s a cheap “main present” sorted.  We’ll get him some books and other bits and bobs as well, but it shouldn’t be more than the budgeted 100 hopefully.

    I’ve stopped going to Slimming World as the low fat thing wasn’t working for me on a vegan diet (no free foods like eggs, etc. meant I was getting no fat at all) – I started getting hair loss and some hormonal problems. I’ve been having lots of healthy fats these last couple of months and everything is improving greatly, although I have gained a couple of pounds. We do want to start trying for a baby this month though, so weight loss is not a priority to me right now – I’d rather focus on overall nutrition.

    Hopefully we can shave some more off our debt before this next baby, but we should be ok financially. We wouldn’t need to buy much in preparation as we still have all of Spud’s old stuff, and I qualify for the 75% maternity pay now.

    I’ll do a full revised SOA soon, but I’ve already done my budgets up to February and things are looking ok. If I can get back into making overpayments that would be great!

    Sorry for the huge essay, just wanted to get it all down so I can move on with normal updates again – hoping to post regularly again to hold myself accountable and be less spendy!

    We do have some scheduled spendiness tonight though – going for a meal for our 5th wedding anniversary – but I think that’s allowed.

    So, all in all, things are ticking over, could be better, but could be a lot worse and although we have been more spendy, we've not gone back to our proper old "bad" ways at all. Everything is within our means, just want to concentrate on utilising our money better again.

    Have a lovely weekend all!
    Last edited by Moguline; 09-11-2018 at 11:58 AM.
    LBM: Christmas 2017 Current debt, as of 01/11/2018: 22,079.76 Total reduction so far: -4,854.54 DFD of my dreams: 31/12/2020
    • Moguline
    • By Moguline 9th Nov 18, 12:03 PM
    • 325 Posts
    • 970 Thanks
    Moguline
    Oh, we've also shifted our DFD to end of 2020 - it's not realistic to reduce it by over 20k in a year haha. Have updated signature to reflect that.
    LBM: Christmas 2017 Current debt, as of 01/11/2018: 22,079.76 Total reduction so far: -4,854.54 DFD of my dreams: 31/12/2020
    • beanielou
    • By beanielou 9th Nov 18, 8:40 PM
    • 58,067 Posts
    • 239,144 Thanks
    beanielou
    Good to hear from you
    Lou~ Debt free Wanabe No 55 DF 03/03/14.
    **Credit card debt free 30/06/10~** **Weight loss 2 stone 12 lbs **

    "A large income is the best recipe for happiness I ever heard of" Jane Austen in Mansfield Park.
    ***Fall down seven times,stand up eight*** ~~Japanese proverb.
    It starts with you, it starts from now. *** It is ok to be me.***
    ***Keep plodding***
    Out of debt, out of danger. MFW 2018. No 144
    • mark88man
    • By mark88man 9th Nov 18, 9:28 PM
    • 3,296 Posts
    • 6,890 Thanks
    mark88man
    indeed - I've upped fresh fruit and fibre in my diet - very nice - but not cheap
    Things happen for a reason. Often the reason is we are stupid & make bad decisions.
    Weight - Fluctuating - less than I was more than I should be
    1/18: CC:11.5K@0% - Car Loan:17K@2.8% - Mort:145K@2.9%
    Decrease in Total Debt 2016:13.4K 2017:8.3K 2018-1H:11K
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