Debt Free Journey

Your Debt Diary – Jodie – One Small Home

December 12, 2018

When I first began following the Debt Free Community on Instagram I was drawn in by the stories everyone would share about their debt free journeys. I find it fascinating to read about the progress others are making and also reassuring to know that I am not the only one in my position.

Your Debt Diary is a guest blog series by money bloggers and members of the debt free community for My Debt Diary. Each week someone new will share their debt story. This week Jodie from One Small Home shares her story of becoming debt free and the action she took to make it happen.

What stage are you at in your debt free journey right now?

I finally paid off my credit card debt last month!

What is your debt total?

It was just under £2,000.

What is your “why”?

I just decided one day it was time to get my finances in order. I’d been carrying around this credit card debt for too long, just paying the minimum payment every month. It got to the point that I couldn’t even remember what I’d bought on credit and if I thought about how much interest I’d accrued and paid – well it made me feel sick. It really was time to take my head out of the sand.

Are you following a specific plan or method?

This kind of happened around the time when I decided to have a good sort out and declutter at home. I live in a tiny flat with hardly any storage and I just had too many things that I wasn’t using. I thought I’d try to sell what I could to pay off my debt.

So, I sold a lot of things from makeup, to clothes and even some furniture and jewellery on eBay. I did try other selling sites such as Mercari and Shpock but I had far more success with eBay. I even did a couple of car boot sales with a friend – neither of us made a lot of money but we more than covered our costs, got rid of some stuff and had a laugh along the way. I did have some books, CDs and DVDs that I no longer wanted – so I sold what I could via sites such as Zeffirelli’s, Music Magpie etc.

I started following money bloggers on Instagram and learnt about side hustles such as survey sites, scanning receipts etc so I gave those a go. I’d already been using a cash back site – I just became even more vigilant about using it.

It was all quite piecemeal but every little bit seemed to help and it was so satisfying to see my debt decrease month by month.

What challenges have you faced along the way?

Quite a few things such as finding the time to declutter and list things on eBay, when sales seemed to stall. And actually the last £300 or so was paid off by cash back, I was amazed how quickly that had built up so I decided to use it to just clear the debt off once and for all.

I still have stuff to declutter so I’ve decided to try to boost my savings by continuing with the selling and the side hustles that pay ok and aren’t too onerous to do. I’ll be honest, that I do feel my finances should have been in better order by this stage in my life, but I do feel better that I’ve started to take control.

I’d like to thank Joide for sharing her story in today’s post. Please make sure to visit her Instagram at One Small Home.

You can read last week’s post here. If you would like to share your story with Your Debt Diary please leave a comment below with your email address or Instagram and I will get in touch. You can find me on Instagram here.

Debt Payment Progress Report 11 – 07/12/18

December 7, 2018

Every two weeks I will be sharing my debt payment progress report with you. I’ll share my new debt total and some of the things I have done to make this happen. It will help me record my journey and it will also help me to stay motivated!

Debt payment progress report – my new total!

As of December 7th 2018 my new debt total is £14,620.03 (My starting debt total was £16,814.29)

That means that in the last couple of weeks I have paid off £250.53. My new total debt payment to date is now £2194.26, which I have calculated to equate to 13% of my debt total. (I should note that I have paid in more than this, however some money has gone straight to interest). The following debts now remain:

Loan One £6561.46
Loan Two £5805.21
Credit Card One £0
Credit Card Two £2253.36

Whilst work has continued to be slow, working hard on my side hustles has really helped me to get through the past couple of weeks and ensure I can cover all of my minimum payments plus a little bit extra. I’m not bounding forward with my debt free journey at the moment but my total is still going down and that’s what matters.

Ebay and Prolific Academic were my biggest earners throughout November and are continuing to help me this month. I managed to hit my goal of making an extra £200 by the 28th, plus a little more. I’m definitely going to be continuing my efforts to make sure Christmas is comfortable. Yes I love this festive season, but I refuse to move backwards for the sake of one or two good nights out and a pile of gifts.

I’m also starting to prepare for the new year, getting my tax return out of the way and readying myself for the busy return to work after some time off over Christmas. January is often one of my busiest months and so being prepared ahead of time with things like my blog will free up as much time as possible for me to earn a bigger income and dig further into my debt total.

You can find my previous reports here.

My Goals for December 2018

December 3, 2018

December is here, the final month of the year and my favourite thanks to Christmas, far too much chocolate and lots of time spent with friends and family. It scares me to realise how quickly time is passing and so I continue to set myself targets, both financial and personal, to help me maintain focus as the days flash by. Here are my goals for December 2018.

You can read my goals for November 2018 here.

My goals for December 2018:

Earn another £100 of side income.

Last month I set myself the goal to make an additional £200 of side income. I was on an absolute mission and after getting stuck into surveys on Prolific Academic and selling some personal items on Ebay I smashed that goal. December is set up to be a busy month with lots of plans for Christmas and so I’ve set myself a lower goal of £100 to suit the free time I will have.

For some, £100 will not be a lot of money. For me, it will mean covering the cost of two dinners. I am very lucky to have two close groups of friends who I make a point of seeing every year. This does mean however, that I have two expensive nights of dinner and drinks to pay for. This extra £100 will cover these and allow me to focus my lower income on my bills. If you’ve been a reader for a while you will know how important this is to me in order to have a debt free Christmas.

Keep spending to a minimum.

This goal might seem like a bit of a cheat as I don’t have to do anything as such, however December is always such an expensive month for me and as such I’m making it my goal to only spend on necessities. I don’t need any more decorations or clothes for nights out. Our kitchen cupboards are always well stocked without all of the extra Christmas themed treats. The gifts I have chosen for everyone are enough and I don’t need to keep adding to them just for the sake of it.

I don’t mean to be a Scrooge of course. Christmas is my favourite time of year and I will enjoy every ounce of it. My celebrations will just be more budget friendly than usual.

Make an additional £100 payment to my credit card.

If you read the results of my goals last month you will know that debt payments were very low. My work load has dropped quite a bit, which it always does over the winter months, and so I don’t have as much income left over to pay towards my debt total. Never the less I want to continue to make some progress on my credit card debt.

To keep things manageable I’m setting myself a goal of £100. It’s small but pushes my debt total down which is what matters. The smaller my total is the less interest I have to pay too!

Make my tax payment.

Over the last couple of months I have been working hard to save up my tax payment which is due in January. Lesson learnt, starting January I will put the money away with each invoice that comes in instead of leaving it to the last minute! Now that I have saved what I am due it’s time to make the payment.

Tax returns are stereotypically tedious so I am setting this as a goal to ensure that I don’t put it off. Ideally I’ll set aside some time this week to get it sorted out, but worst case I know I need it completed by the end of December. As much as I hate the process it will be a big weight off of my shoulders going into the new year.

Have you set yourself some goals for the month? Let me know in the comments!

Your Debt Diary – Jane Has Debt

November 28, 2018

Your Debt Diary is a guest blog series by money bloggers and members of the debt free community for My Debt Diary. Each week someone new will share their debt story. This week Jane from @janehasdebt shares their journey so far and the extraordinary challenges they have faced.

What stage are you at in your debt free journey right now?

I am stuck in a time warp. Look more like it. I have been trying to get out of debt for the past 10 years. Part of the problem is that I have ADHD – also known as not being able to rationalise anything because of getting into a space of being hyper-focused and also being impulsive. I have fortunately learned to curb everyday expenses both using personal finance tools like budgeting and using the cash envelope system. Critically stopping big purchases due to my ADHD is still a work in progress (like financing cars or buying concert tickets).

For the most part I was doing well but a few years ago life literally flipped me upside down and shook everything out of me within a year’s time. Divorce, passing of mein Kind, my own health issues, and my car was totaled at the other person’s fault. I had to draw my focus somewhere, so I went back to school by taking out student loans, I had to rent/deposit a new place, and I bought a new car to replace my just-paid-off previous now totaled car. Plunged myself into another $23,000 on top of my already 38,000 (total – $61,000).

Then I found Mr. Money Moustache blog and the forums. It was a godsend to me at the time I found it. The diversity of people available and their brilliant knowledge in personal finance saved me. I am still not in a good place with debt. But overall I am in a much better place with my finances – awesome credit score due to bills being paid on time, budget brilliantly, put 10% away in my retirement account, increased my income, increased my net worth and now craft my own cash envelopes.

What is your debt total?

Between health, education needs for my other Kind, and financing another used car (major mistake) – at my highest I have owed $81,120 (April 2018). I am now at $69,324.

What is your “why”?

The worst thing ever was not being able to take extended time off when mein Kind got sick. I didn’t have the family to help, I did not qualify for FMLA (Family Medical Leave Act) and I couldn’t quit my job without sinking into homelessness. Twenty four hours a day I was working full-time, taking care of two in separate locations, attending health appointments and commuting hours at a time. I was exhausted and I was in a flurry of frustrating emotions at the lack of support every corner I turned.

I will never be in that space again.

Are you following a specific plan or method?

I try follow the Dave Ramsey baby steps 1 and 2. I keep a strong budget. Discretionary expenses are cash only (with pretty envelopes). But I don’t always have a full emergency fund. Actually it’s one of my pet peeves because I can never keep it filled up.

What challenges have you faced along the way?

Being in debt for so long…actually I have been in debt my whole adult life. But at the time of being mindful of my debt I have not been able to get my debt down! It’s so frustrating. I’m on a roller coaster without the ability to get off of it. Frankly it is tiring! The last stint was my car breaking down and deciding it was better to finance another than spend the $4,000 to fix it. That was such a bad decision.

I am kind of freaking out about my debt load because die hard planning for retirement is now coming into focus, Um, no bad nursing homes wanted nor do I want to be broke. With a problematic and expensive U.S. healthcare system, it’s a scary thought not having enough money available. Especially when I think of everything else I am concurrently financially managing and/or trying to save up for.

What are you doing to speed up the progress of your debt free journey?

The past few months I haven’t been able to snowball. The 4th quarter is when all my annual expenses come due and I didn’t have sinking funds available to cover them. So the snowball portion and payment plans covered these expenses. Fortunately, starting in 2019 my snowball will resume.

As for side hustles, it is not working out for me. I don’t much to sell off and side hustle opportunities are not coming to fruition. I plan on trying a couple of other side hustles in the new year. I’ve started saving my $5 bills to help me fund my emergency fund.

All extra money received (i.e. tax return, bonuses etc) will be thrown at paying down debt.

When do you plan to become debt free?

As long as I stay cash only with discretionary expenses and keep the credit cards out of the picture (because ADHD and CCs don’t mix), I will be debt free 4th quarter 2022. God help me.

I’d like to thank Jane for today’s post. Please make sure to visit their Instagram at @janehasdebt.

Did I Achieve My Goals for November 2018?

November 26, 2018

We have reach the end of another month and it is time for me to look back at the goals I set and reflect on how I have done. So did I achieve my goals in November 2018? I feel like I could write the a very short answer here. No. No I didn’t achieve all of my goals. I have made some progress none the less.

My goals for November 2018 were as follows:

Boost my side income
Begin a sinking fund for next year
Clear another £500 of my second credit card
Finish saving my tax payment

Boost my side income.

My intention, my hope, was to make an extra £200 this month from side hustles in order to combat the lower amount of freelance work that I always get during the winter months. Well I am pleased to say that on the 24th I smashed this goal and I am still adding to it. Considering this has been quite an unsuccessful month goals wise I am so pleased that this one has gone well.

If you have debt yourself, or you have had debt in the past, you will know the stress of limited funds at Christmas. This £200, although it is not a huge amount of money, will cover my Christmas shopping and ensure that I can still pay my bills without even having to think about using my credit card. That is priceless. Both Ebay and Prolific Academic have played big roles in my success with this goal. I highly recommend both if you’re trying to boost your income!

Begin a sinking fund for next year.

With the help of my extra income total, I have also been able to add a small amount of money to my savings in preparation for next year. With our wedding, honeymoon, my hen do, a friend’s wedding and hen do, two big birthdays and many other things along the way I’m sure, there will be a lot to pay for.

Saving a small amount of money each month now is going to make such a difference to my debt progress and my bank balance. It also ensures that I won’t be panicking and scraping together money at the last minute. So far I have put away £50 which is a good start.

Clear another £500 of my second credit card.

Unfortunately I was nowhere near reaching this goal in November. In fact, I was only able to pay £100 towards my credit card this month. I’m definitely disappointed as I was hoping to clear the majority of my card before the new year. With £2277 still left on it, this won’t be happening.

On the plus side, I paid in more than the minimum amount and I was able to make the payments towards both of my loans comfortably too. This is a world away from the way I handled my finances when I began my debt free journey. At that time I was scraping together the pennies and pounds and in a constant state of panic. That difference alone is something to celebrate!

Finish saving my tax payment.

It hasn’t been possible for me to complete my tax payment goal either. My earnings just weren’t high enough. Thankfully I have been able to add a small amount to savings and don’t have too much further to go now. Another £250 in the pot and I’ll be ready to process my tax return, so this will be the focus of December. Once that’s completed I’m sure I’ll feel a big weight lifted as of course there is a deadline. Then I can return my attention fully to my debt free journey.

I’ll be setting my goals for December on the first of the month so keep an eye out for that post!

Your Debt Diary – Light at the End of the Debt Tunnel

November 21, 2018

Your Debt Diary is a guest blog series by money bloggers and members of the debt free community for My Debt Diary. Each week someone new will share their debt story. This week Amy from Light at the End of the Debt Tunnel shares her mission to become debt free by Christmas 2020.

What stage are you at in your debt free journey right now?

We have budgeted and tried to pay off debt for years – at least since 2014. Somehow, though, our debt continued to increase. We started with new focus in January this year but found the debt free community in August and are now going “gazelle intense” as the Dave Ramsey community says. We’ve finally stopped adding to our debt and are aiming to start sinking funds in January.

What is your debt total?

£12,431. All on credit cards, all (thank god) interest free at the moment.

What is your “why”?

We want to buy a house. We’d just love to own our own home. We also have a daughter and we want to stop the cycle. My parents were always in debt (still are) and constantly spent more than they had on credit cards. I don’t want my daughter to ever experience this stress.

Are you following a specific plan or method?

I take inspiration from Dave Ramsey but I haven’t followed his baby steps. We are paying our cards off in the order the 0% interest ends. We will also use the sinking funds method because a big part of our debt was car repairs and other unexpected expenses.

What challenges have you faced along the way?

Not having sinking funds has made it difficult to pay down debt. Our debt has actually gone up as well as down since August but I’m working hard on paying it down. I always used to say we didn’t have enough money to put aside for unexpected expenses but something has to change so I’m going to give it a try. Even £50 in a sinking fund will help when I need new tyres or something else!

What are you doing to speed up the progress of your debt free journey?

We plan a budget together every month to stop us having to out anything on credit. Our sinking funds will also stop our debt increasing again hopefully. I am listing lots of items for sale that we don’t need anymore, doing surveys and I’ve also recently started matched betting.

When do you plan to become debt free?

Based on our current payments, we are about 21 paydays away! Hopefully Christmas 2020 will be a debt free one! My goal is 18 months though as I’m factoring in our childcare reducing when our daughter starts school as well as my annual wage increase. I’d love to reduce that even further because the long term goal is to save for a house deposit and the thought of it being nearly two years before we can even start to save is so depressing. Here’s hoping we can be in our own home in 3-4 years time!

I’d like to thank Amy for sharing her story in today’s post. Please make sure to visit her Instagram at Light at the End of the Debt Tunnel

Debt Payment Progress Report 10 – 16/11/18

November 16, 2018

Debt payment progress report – my new total!

As of November 16th 2018 my new debt total is £14,707.43 (My starting debt total was £16,814.29)

That means that in the last two weeks I have paid off £163.13. My new total debt payment to date is now £2106.86, which I have calculated to equate to 12.5% of my debt total. (I should note that I have paid in more than this, however some money has gone straight to interest). The following debts now remain:

Loan One £6723.67
Loan Two £5706.35
Credit Card One £0
Credit Card Two £2277.41

Although I have had another slow fortnight with regards to my debt payments, I am in no way disappointed. If you read my goals update post on Monday you will know that I had to revise my focus a bit. Whilst I would love to pay off my debt as quickly as possible, work tends to slow down for me in the winter months and I have to adjust my budget to suit.

Instead of ploughing every spare penny I have into my credit card I am choosing to be a bit more conservative with my money, keeping some aside just in case my freelancing work drops dramatically. The most important thing is that I am able to afford all of my minimum payments and bills. Then of course there’s the added cost of the Christmas period to consider!

As I have said countless times before, the amount I pay each week, month or year isn’t the focus. The important thing is that I continue to pay off my debt piece by piece. Even when progress is slow, the small payments I am making add up so quickly and make such a big difference over time. If you’re finding that your debt free journey is moving slowly at the moment, stick with it. As long as your total is going down, even by pennies, that is what matters!

You can find my previous reports here.

Your Debt Diary – The Penny Pinching Js

November 14, 2018

Your Debt Diary is a guest blog series by money bloggers and members of the debt free community for My Debt Diary. Each week someone new will share their debt story. This week The Penny Pinching Js shares their journey so far and the extraordinary challenges they have faced.

What stage are you at in your debt free journey right now?

We are in baby step 1 – snowballing our way out of debt.

What is your debt total?

Our debt total is $89k+. Mine alone is $52k and my husband’s is $37k.

What is your “why”?

To improve our credit score and save for a house without worrying about other debt.

Are you following a specific plan or method?

We follow Dave Ramsey’s steps and have taken the Financial Peace University.

What challenges have you faced along the way?

Challenges to date? Oh my, where do I begin! We are actually on attempt number two. During our first attempt I lost my husband’s car keys and used part of the emergency fund to replace them. Recently, our kiddo went into surgery so I had to exhaust my leave since I do not qualify for FMLA until December 2018 and ended up taking leave without pay for a total of 24 working hours. Our home island was hit by a super typhoon and we made the mutual choice of donating half of our emergency fund to relief efforts and using the other half to buy items for our family members still on the island. My car was in the shop for a week and with our emergency fund exhausted, I had to use a credit card that was paid off during our first attempt. That caused us to start all over again from baby step one.

What are you doing to speed up the progress of your debt free journey?

To speed up the progress I’ve been working overtime when I can. Thankfully my career pays for my commute hours so I work the usual work day and get paid for my travel to and from the work site which pushes me into 5+ overtime hours a week. My husband doesn’t have that luxury because his salary is fixed since he’s military. I have a small side hustle of teaching dance and I’ve been looking into driving for Uber and Lyft.

When do you plan to become debt free?

We have honestly not established a “debt free date” for the purpose of getting a hold on anxiety and causing meaningless tension in our marriage. We just take it month by month and apply the method we’ve learned. We’ve got a total of twelve debts since I broke the group of my student loans out to individual loans and we’ve paid off debts 1 & 2. Now onto debt 3!

I’d like to thank the Penny Pinching Js for today’s post! Please make sure to visit their Instagram at The Penny Pinching Js

My goals update for November 2018

November 12, 2018

The days are disappearing and so it’s as important as ever for me to keep my monthly targets top of mind. Sharing a goals update with you last month really helped me to keep on track with them so I’ve decided to make it a regular, mid-month post. Here is my goals update for November 2018.

Boost my side income:

This is going really well! So far this month I have sold two things on Ebay and made over £40 on Prolific Academic doing surveys. I’m now almost halfway to my target of making £200 extra in November which makes me really happy and reassures me that I won’t struggle to afford bills and debt payments. Work has also picked up again, thank goodness, so hopefully I can make more of an income from freelancing before the month finishes.

Begin a sinking fund for next year:

With two weddings, two hen dos, my honeymoon, a 30th birthday, a 60th birthday and several other big celebrations next I wanted to make sure I was making a start on saving for them all. Yes our own wedding is paid for and the honeymoon is pretty much there, spending money included, but everything else needs to be covered.

I’ve made a small start, with £40 put away into my savings pot. This sounds like very little, but I’ve worked out that if I put roughly £55 into savings each month everything should be covered so I’m not doing too badly!

Clear another £500 of my second credit card:

As work has been slowing down for winter, I’ve made a bit of a revision on my debt payment goal. I would absolutely love to clear as much of my final credit card as I can before Christmas, however my tax payment has a pressing deadline and I do need to make sure I will be able to make minimum payments across December and into the New Year.

Small amounts will continue to be paid towards my card here and there, but my focus will be on my final goal until it is complete and I know that I am prepared for my quietest working months.

Finish saving my tax payment:

With roughly ten weeks to go until the tax return deadline (if you haven’t sorted your own yet, get started now. It will save you a lot of hassle and stress in January!) I am getting very close to hitting my goal. I needed to save roughly £1200 in order to cover all of my payments this year. I will know the exact amount when I complete the forms but I like to be prepared for the worst case scenario. Thanks to my first goal, making more money on the side, I’m really pushing towards my total now and will hopefully be completing my tax return in early December.

My goals have already needed some adjustment this month, but I’m being flexible and ensuring that the important things are covered. It is great to try and storm ahead with debt payments, but bills need paid and my tax return is non-negotiable. Once those are covered I can get back to my debt snowball!

How are you getting on with your goals? Let me know in the comments and be sure to join in with the linky myself and Charlotte host!

Your Debt Diary – The Personal Finance Coach

November 7, 2018

Your Debt Diary is a guest blog series by money bloggers and members of the debt free community for My Debt Diary. Each week someone new will share their debt story. This week Ray from www.thepersonalfinancecoach.org shares his debt free journey so far and his mission to help others become debt free too.

What stage are you at in your debt free journey right now?

Currently I have one debt remaining, my house.

What is your debt total?

As of October 31st, 2018 the balance on my house is $309,136.28. Keep up with my Instagram account to see my progress!

What is your “why”?

My why is my family. Growing up as a child, my father worked around the clock to provide for our family and subsequently he missed out on so much. My wife and I recently had our first child and our goal is to change our family tree forever. We want to be able to live free of financial strain, make memories as a family, and give generously to those who need it the most.

Are you following a specific plan or method?

Yes, I follow and coach individuals through Dave Ramsey’s baby steps.

What challenges have you faced along the way?

Back in 2014 when we started our journey, we paid off $33k in 18 months. It was a challenge to go against the social norm of buying a house, new car, eating out, or going on vacation. We had to say no a lot to friends and family. We were made fun of, but now ironically, those same people are asking for my help. Shortly after finishing up our consumer debt, we were building our emergency fund of 3-6 months and then life happened. My wife was in and out of the hospital, and in America that is very costly. Fortunately, due to our diligence and previous behaviour, we were able to cash flow that horrendous year and really focus on her health. Now our challenge is to stay disciplined and motivated on this journey.

What are you doing to speed up the progress of your debt free journey?

After running some numbers, my wife and I decided to pay an additional monthly payment on the principal of our house which will shorten the loan by 7 years. Alongside that, any money that is leftover from our budget each month will go into a “discretionary” checking account. This discretionary fund will be reviewed together twice a year and we will decide together how to allocate the funds. Likely a majority of the fund will go towards the house, but if other things come up, we will have the option to use that fund.

When do you plan to become debt free?

Our goal is to be completely debt free by 2030. That will be paying off a $320k loan within 12 years as opposed to 30 years! It is a lofty goal, but if you aim at nothing, you will hit it every time.

I’d like to thank Ray for today’s post. Please make sure to visit his blog at www.thepersonalfinancecoach.org
and on Instagram, Facebook and Twitter at @thepersonalfinancecoach