13 months to debt free

It’s been a long time since my first and last post. I have managed to change quite a lot in that time! I handed in my notice at both of my jobs without having anything to go to, which was terrifying. After a very stressful month or so an absolutely fabulous job came up in Bristol, which I decided was close enough to Cardiff, the place we really wanted to move to, that I would apply for it. As it was so fantastic I didn’t think I’d get it, but I did! So now, eight months on from that first post, I can definitely say that I’ve succeeded in changing my life. There’s still a lot more to do though…

At the moment my main concern is to pay off my debt. Living in London and generally being absolutely terrible with money has led to me being in an alarming amount of debt. I’m the first to admit that I’m terrible with money. I don’t know how I’ve got into this much debt, but just living slightly above my means for five years has led to accumulating almost £9500 of credit card debt. That is deeply shocking to me. When I worked out how that was even possible I discovered that just spending 10% more than I earned over the five years would do it. Which just goes to show that it is REALLY important to live within your means.

This week I’ve been adding everything up and getting my head around the figures and, frankly, panicking slightly. I’ve also had to pay nearly £3000 for an annual season ticket to travel to work, so I have a lot to pay off. Luckily I get paid well, so I’ve made a resolution to become debt free in 13 months. I’m on a fixed term contract and can count on 13 pay days before it ends. I have no idea what I’ll be doing after that so it’s really important for me to achieve this goal!

Now I have to admit that I’ve done this before. I’m a classic binge-fast spender. I’ll draw up terribly strict budgets, stick to them for a few weeks, then go on a massive binge and forget all about managing my money for months. Which leaves me in a bigger mess than before. This is why I’m blogging about it this time. It feels terrible to be publicly discussing my financial woes, even if no-one is actually reading it, especially as I was brought up not to discuss money (how terribly British). I’m hoping that in a way blogging might make me stick to my budget better. We will see.

As well as paying off all this debt I’m hoping to save at least £2000, ideally £3000. This is because of the uncertainty over my next job. I also have dreams of buying a car and some land, and will need funds to do this. I’m hoping that my dreams will help me stick to The Plan.

I currently have three credit cards. One is on standard rate, so I have to prioritize this one. The others are interest free for varying lengths of time. I’ve worked out what I need to pay off each month on each one before the interest free period ends and set up a standing order to a savings account the day after I’m paid. Once they’re paid off I’ll be sticking to the same budget so that amount can stay in the savings account.

Cut up the credit cards. This is very drastic for me as I’ve never been able to do it before. Every other budget I’ve done I’ve kept the cards on the grounds that I get cashback, or commission free travel money, or some other excuse. I’ve come to the conclusion that for people like me credit cards are dangerous. I just can’t keep track of my spending on them, and purchases stack up for more quickly than I can imagine. If I go out shopping and buy three things, I’ll usually underestimate significantly what they add up to. So the cards have to go. I’m going to withdraw my weekly allowance in cash on Saturdays and that will be it for the week.

I’m also trying to save a pound a day in a jar, and will try and do another jar to save for birthday and Christmas presents.

My partner and I have a joint account for food and bills so I’ve already got a standing order set up for essentials. Everything else has to come out of what’s left, which is £50 a week. Should be easy, right?! Plenty of people live on far less than this so I should count myself lucky that I have so much and just get on with it!

Immediate goals

By 1 June – save at least £17 in my jar

By 1 July – pay off my John Lewis card and then cut it up *sob*