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  • FIRST POST
    • Radsi
    • By Radsi 11th Jul 18, 2:19 AM
    • 3Posts
    • 2Thanks
    Radsi
    Paying it forward
    • #1
    • 11th Jul 18, 2:19 AM
    Paying it forward 11th Jul 18 at 2:19 AM
    In 2 years I want to be debt free and have a decent deposit to buy my own little home and get a cat called marmite. I am starting this diary to hold myself accountable.

    My past has been rocky and I accumulated debt through a variety of reasons but one included returning to higher education in order to better my situation. I have now finished and have a secure career although i would look to change this in the future as it is pretty stressful and the shift work isnt sustainable long term.

    I had a total of 4 loans with differing terms with a total balance left of 18,500 the longest of which would have taken 4 years to pay off. I have just consolidated these to one single loan of 25,000 with a 3 year term (until Aug 21) and a much lower APR of 3%. I have paid off all the existing loans and used 4000 to put into a Lifetime ISA I have just opened with the aim of hopefully putting another 4k in April 19 and 4K April 20 with the view to then having 15K (including the 3K government bonus) to use as a deposit and money saved to pay off the loan early In summer 2020 so I can apply for a mortgage.

    Current earnings: 1950 minimum net can go up to 2300 depending on shifts

    Outgoings:
    300 rent
    200 bills
    735 new loan payment
    500 to Savings
    Total= 1735

    This leaves a minimum of 215 a month up to 565 to cover everything else and try to save some more.

    Savings:
    2500 left over from loan amount in Savings account
    4000 in Lifetime ISA account

    I love food and video games they are my biggest vice and the whole fear of missing out when a new release comes out means I will splurge sometimes but I need a house to play them in and a little cat to keep me company.
Page 1
    • Starmummy
    • By Starmummy 11th Jul 18, 10:04 AM
    • 276 Posts
    • 1,307 Thanks
    Starmummy
    • #2
    • 11th Jul 18, 10:04 AM
    • #2
    • 11th Jul 18, 10:04 AM
    happy new diary.

    My aunt has a dog called Marmite

    Bets of luck with everything

    Take care

    SM
    debt consolidated 16/8/18 11,917.34/12,618.12 (Total debt at LBM c..19.5k)
    EF savings 650.06 House Deposit (LISA) 480.00/12,000 4%
    • Radsi
    • By Radsi 13th Jul 18, 1:26 AM
    • 3 Posts
    • 2 Thanks
    Radsi
    • #3
    • 13th Jul 18, 1:26 AM
    • #3
    • 13th Jul 18, 1:26 AM
    Finally got around to contacting the final company to pay off the outstanding balance on the loan as I didnt like having the money sat around in my account and it is now paid in full and closed.

    Reassessed my finances and this has left me with 5000 in a instant access savings account (the remainder of the loan balance and including a mass of overtime I have been doing recently) along with 250 and 500 respectively in the two regular saver accounts I recently set these up on d/d 250 a month for the next 12 months.

    Still have around 250 to last until payday with only around 100 or so of bills to come out.

    Cancelled a preorder for a video game which had been prepaid for the other mo th for 36.85 as I really dont need it and it doesnt look that great. Can hopefully stick this money in another saving account I have set up for extras.

    On a side note owe a friend 20 for an event coming up and after being told by the bank today on the phone that you can edit the name of savings accounts jokingly called one the !!!8220;cat fund!!!8221; and transferred 20 into it without realising that it is a no access for 12 months one. Sent them the screenshot and they seem to find it pretty funny. I said they can have their 20 back in 12 months when it is 20.30.

    Had to spend some on food last few days to stock up and then potentially another spendy day tomorrow as having minor surgery typically in the middle of a work day when noone is around so will need to pay for transport there and a taxi back home. Will probably be a fairly quiet weekend/ week as will be stuck in the house for a little while. As long as I stay away from online shopping I will be fine I am also terrible for spending money on food and takeaway meals so having to actually buy food in for the next week or so has been good for me.
  • archived user
    • #4
    • 13th Jul 18, 7:12 AM
    • #4
    • 13th Jul 18, 7:12 AM
    Welcome and good luck. You sound very organised. Hope op goes ok.
    • Scott Chegg
    • By Scott Chegg 13th Jul 18, 7:48 AM
    • 33 Posts
    • 59 Thanks
    Scott Chegg
    • #5
    • 13th Jul 18, 7:48 AM
    • #5
    • 13th Jul 18, 7:48 AM
    Good luck with your plans . I too hope you op goes well.
    • beanielou
    • By beanielou 14th Jul 18, 9:48 PM
    • 58,054 Posts
    • 239,079 Thanks
    beanielou
    • #6
    • 14th Jul 18, 9:48 PM
    • #6
    • 14th Jul 18, 9:48 PM
    Hope that you have closed down all current lines of credit.
    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
    • enthusiasticsaver
    • By enthusiasticsaver 14th Jul 18, 10:07 PM
    • 7,284 Posts
    • 15,992 Thanks
    enthusiasticsaver
    • #7
    • 14th Jul 18, 10:07 PM
    • #7
    • 14th Jul 18, 10:07 PM
    I am not sure of the wisdom of increasing your borrowing from 18500 to 25000 to then put 4000 of it in a Lisa earning probably much less than 3% in interest. You do get the bonus but you would get that with your monthly savings anyway and your loan payment would be lower or the term shorter. Is it a cash lisa or a stocks and shares lisa?

    I appreciate you are trying to concentrate on buying a house as well as clearing debt but the general advice is clear debt first as in almost all cases you are paying more in interest on the debt than you get in saving even taking the government bonus into consideration.


    As Beanielou says you need to make sure you have closed all other lines of credit as the temptation with consolidating debt is to think you are debt free and run up credit cards again so you then have a loan plus a credit card. Given you had loans rather than credit cards though that may make it harder particularly as you now have that large unsecured loan. Not a bad rate though.
    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
    • Radsi
    • By Radsi 17th Jul 18, 4:13 AM
    • 3 Posts
    • 2 Thanks
    Radsi
    • #8
    • 17th Jul 18, 4:13 AM
    • #8
    • 17th Jul 18, 4:13 AM
    Been hibernating for a few days as had to wait around 72hrs ish to see how the medical thing would go. Doesnt look like it has fixed the issue completely but may have improved it slightly although am now kind of stuck for 3 weeks until a follow up appointment although further changes could happen in next two weeks just have to wait and see

    Thanks to all of you for stopping by and your comments and best wishes. Just to address a few of the posts above:

    beanielou yeah all the credit cards have gone now.

    Enthusiasticsaver thanks for the post. Yeah I appreciate that borrowing more seems counterintuitive however the rate I could get dropped significantly on borrowing the 25K as opposed to borrowing the 18,500 ish needed to consolidate the other loans and reduced the term on some of them and the interest rates some of which were around 6.9%. It made sense to put some of the extra into filling the LISA for the year (which is a cash one by the way) and then I know I have the buffer of having the 4K to max it out again in April 19 and save towards the April 20 one with the aim to buy a house around June/July 20.

    I am aiming to save 500 a month 250 each into 2 regular savers for 12 months at 2.5% interest each. If I do this and save any extra money I can along the way I should have the balance to repay the loan in full in 2 years as well as the deposit saved. Career wise by then I will be in a good position to move area and am aiming to look for a house for around 150,000. It just feels like doing the two things at the same time paying back the debt and saving for the deposit just makes it easier in my mind to justify doing the overtime or not having that takeaway/splurging on things whereas if it was just paying back the debt I wouldnt feel like I was getting to where I want to be 2 yrs from now.

    Said friend whose 20 is locked away in the account for 12 months has said I can keep it and when I get my house they will pay the adoption fee for the catty as a housewarming gift. I helped them out with a career move recently and they are very religious and so a promise is a promise. I definitely have to do this now i literally have cat envy of everyone who has one and cant have one where I live at the moment plus a gifted cat is even better.

    Thanks again to everyone who has stopped by and hope your week is going well
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