Money Saving

My Money Goals for February 2019

February 5, 2019

After losing track of my goals in December and forgetting to set any altogether in January I am so happy to be back and bringing some focus and intention to the coming month. With tax payments and the expense of Christmas long gone it is time to focus on my second credit card and clear it as soon as possible. Here are my goals for February 2019.

You can read my goals for December 2018 here.

My goals for February 2019:

Increase income by £500 per month.

Over the winter months my work load always drops dramatically, so much so that you’re probably sick of hearing about it by now. Whilst it is an expected dip I’d rather fill my hours a little more if possible. Instead of relying on side hustles only for this I’m making the effort to increase the number of freelance clients that I work with on a regular basis.

It is always difficult to determine how much work a new client will bring and I am very familiar with the promise of lots of incoming projects only to be left disappointed. At the same time, I don’t want to take on too many new clients at the same time and then completely overwhelm myself. Ideally, all going well, I’ll be able to do enough to add around £500 to my monthly income. I’ll keep you posted on this!

Begin a sinking fund for the Spring.

There are birthdays and weddings galore this spring and I am going to be spending a lot of money. I will be able to keep my spending to a minimum in some areas, by gifting my help to a friend for her wedding instead of giving money, however for most of it I will just have to bite the bullet.

I’ve estimated that I will need around £600 to cover everything that is going on so I’m going to be putting about £50 aside each week. Now you can see why I want to increase my income so much! It will be a lot of work, but it will stop me panic spending in the moment and will avoid any credit card related disasters. Saving so much each week is worth it when the only other option is to go further into debt!

Make an additional £200 payment to my credit card.

As I mentioned before, my credit card is the next item in my debt snowball and I am determined to get rid of it as soon as possible. It’s been hanging over my head for so blooming long now I’d like it paid off and out of my life. Of course that’s how I feel about all of my debt, but you know what I mean.

As £200 isn’t a huge amount I’m going to do my best to side hustle this amount. Between taking surveys (if you’re new to surveys use prolific academic, they’re by far the best), decluttering more items for Ebay and a few other things it might just be possible if I get my head down.

Allow myself a treat.

If you’ve been following my journey for a while you will know that all of my goals always focus on paying off debt and saving money as quickly as possible. The ones above demonstrate that by themselves. Well my final goal is shaking that up a bit. I’d like to set aside some money for a treat for myself. Nothing big. Just something that brings me joy and helps keep me motivated when my spending is normally so tight.

My original intention was to get myself some flowers however I found an awesome deal and got some free. (I posted about it here on Instagram if you fancy a nosey). Instead I have considered taking myself to a really nice cafe or hotel for some lunch. Feet up, read a book and just enjoy a really tasty meal. That would be an awesome treat!

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

Cheap Wedding Rings | Five Frugal Things for January 2019

February 1, 2019

In an effort to pay off my debt as quickly as possible, I’m looking beyond simply making extra money. I have been assessing all of my spending habits, adopting a more frugal lifestyle wherever I can. Each month I will be sharing Five Frugal Things that I have done to help improve my finances and ensure I can reach my goal of becoming debt free as soon as possible.

One

Free flowers. A week or so ago a blogger that I follow posted an Instagram story about some beautiful flowers she had received in the post. At the beginning of the year I set myself some goals and always having fresh flowers in the house was one of them. Yes it’s a small goal, but they make me really happy and so it was an important one for me.

It turns out that the flowers had been free thanks to a coupon code which I could use too. I ordered my flowers straight away and we both received a free bunch of flowers. Now that they’ve arrived I’ve shared my own code with friends and family and it looks like I might be getting free flowers for another month or so. I’m so happy! (Of course this is a subscription service, so I’ll be cautious of the future payments).

Two

Using loo rolls in my living room decor. This one sounds classy doesn’t it? Are you picturing a sofa made of toilet roll or something? Don’t worry, it’s not that weird. I have curtains with eyelets at the top which hang straight down. When I open them in the morning, if I don’t spend time evening them out they always look a bit…meh.

Then Beckyhomesweethome (if you love interiors and chatty stories you’ll love her) shared a tip on Instagram. Pop a loo roll tube between the eyelets of your curtains as you loop them over the curtain pole. It spaces them out really nicely and means that they hang well without any effort. Of course the loo rolls are also free and recycled now too!

Three

Cheap wedding rings. I have mentioned previously that I will be getting married this year. All the big things are sorted now so we’ve been working through the “bits and bobs” list as the big day gets closer. One of the most important things left on our list was wedding rings. We had been warned by friends who have married recently that they would be really expensive so we braced ourselves.

We had a good idea of what we were looking for, something simple and classic with mine matching my engagement ring. Now we just had to find them. A quick browse online took us too Amazon (of course it did) and within about half an hour we had both chosen rings that we loved. The grand total? Around about £115. For both! I was a little sceptical about quality but they’re both high quality materials (14k rose gold for me) and just as promised.

Four

Using the resources I have. As someone who runs two businesses from home I am always looking to expand my knowledge. In the past I have been the worst for purchasing course after course, filled with motivation to learn more. Of course most of them were looked at for a moment and then quickly forgotten about. If I’d given them focus I’m sure they would have been brilliant but without actually using the courses they were just the biggest waste of money.

Predictably, as often happens when a new year rolls around, I found myself filled with new motivation once again at the beginning of January. This time however, I chose to look through the resources I already had stored away instead of looking for something new. I’ve tried to keep things as simple as possible and just focus on one course at a time. So far the one I am working through is helping me a lot and I am now actually gaining value from it and I have spent nothing!

Five

A romantic meal for two…at Ikea. So I know Ikea is a bit like Marmite; some people love it and others hate it. Well myself and my better half LOVE strolling round the shop, having a nosey at all the decor ideas and of course always enjoy the classic meatballs!

Normally we go during the day, most likely on a Saturday but when I found out that the shop stays open until 10pm we had to change things up. This time we arrived at dinner time, enjoyed our usual wander and then sat down for an awesome and very cheap meal. No, it’s not a swanky place and OK it’s not the most romantic, but that’s not the point of dinner with your significant other is it? We had a blast and dinner cost us a whopping £12.

There they are, my Five Frugal Things for the month of January. You can read last month’s post here.

I’ve seen a number of people talking about doing a “no spend month” in February and Nicola from Mum on a Budget has even written a great survival guide about it here so that may be frugal approach to the next 28 days. You’ll need to come back next month to see how I get on!

I’m linking up with Cass, Emma and Becky in this week’s Five Fabulously Frugal things I’ve done this week linky.

Decorate for Christmas without Breaking the Bank

December 5, 2018

As someone who absolutely adores Christmas and everything that comes with it I completely understand the urge to go over board with decorations come December. As a result this can of course mean spending a lot of money, but it doesn’t have to. From affordable trees to simple touches that give your home a festive feel, here are ways to decorate for Christmas without breaking the bank.

Find an affordable tree

The centre of most homes at Christmas is the Christmas tree. There are two options when finding one of course, real or fake. Buying a real tree can often be the cheaper option however it will only last the month before needing to be thrown away. Fake trees, whilst not quite as realistic, can be stored away and kept for years to come. This is where it’s best to do a bit of research and figure out which is the best for you.

After taking a quick look around I have noticed that Home Bargains are selling real trees this year for £9.99. They may not be the bushiest, however they are a fantastic option if you are on a tight budget. You can also find very affordable artificial options in many shops and online. I’ve found this one on Amazon for just £19.99 and it is 6ft tall!

Add finishing touches to budget items

Often I’ll spot cheap wreaths and garlands in the shops which are a great price, but look a bit bare. There is such an easy trick to solve this. Instead of leaving it as is, buy a few extra finishing touches to add to your decorations that will really bring them to life.

As an example, last year I bought a plain wreath from a budget shop. I then purchased some pine cones, berries and ribbon at £1 each along with some wire. It only took me around twenty minutes to add these to the wreath, fluff out the foliage and then finish it with a bow. I had only spent around £10 in total, which was still a lot less than the more expensive shops were charging and now I have a beautiful wreath for my front door that I can use year after year.

You can do this with essentially any decorations and it makes such a difference. If you’re not naturally creative, have a quick nosey on places like Pinterest and Youtube. You can find some great ideas and “how to” tutorials.

Stick to a colour scheme

There are two big benefits to choosing one colour scheme that you love. Firstly, having one or two colours throughout all of your decorations will pull them together and really make your room or home look more full and complete. I always stick to green foliage with red and gold accents in the form of baubles, berries and lights. Many of the shops even do large sets of baubles like this one here which should be enough to cover an entire tree.

Secondly, if you stick with the same colours year after year you won’t have to buy new decorations each December. Having spent around £150 in 2017 on our decorations I was worried about our potential spends this year. In fact, we have only spent £6 on a couple of baubles from trips we have taken. If you look after your decorations well and store them properly throughout the rest of the year they will last you a long time.

Never underestimate the impact of a few candles

The flicker of a candle flame can have such a huge impact on a room. So much so that the Danes have a name for it; Hygge. A candle brings so much cosiness and, paired with a few simple decorations, can bring a real feeling of Christmas into your home. If you choose to opt for a scented candle, you will add that extra layer of warmth. My favourite has to be apple and cinnamon. Of course, some people prefer not to have an open flame in their home. In this case faux candles like these ones, paired with a room diffuser would give the same cosy effect.

Hang up your Christmas cards

Before decorating my own home for the first time last year I worried how I was going to fill one particularly blank space of wall in our living room. As our Christmas cards began to arrive however, it occurred to me that they would be the perfect solution. I found some twine that I had been using to wrap presents with and a couple of pins and strung them up in two rows. The room felt more and more complete as they dropped through the letterbox each day. As a bonus, I wasn’t getting annoyed with them all falling off the shelves and sideboard as I normally would!

Make your own

Last but not least, home crafting is another fantastic way to decorate without spending a lot of money. You might in fact have many of the things you need to decorate in your own back garden. Take a moment to go outside and see what you can forage. Sprigs of holly and berries could be added to a flower arrangement, whilst pine and conifer might be the perfect foliage to create a fireplace garland. Inside the home you might even have some spare paper to make paper chains, a simple but classic touch to add to your living room.

As I have mentioned before in my other Christmas posts, this is a wonderful time of year but it is not worth causing yourself financial problems over. There are always budget friendly solutions and often the items that we have worked on ourselves are the ones we hold on to most fondly for years to come.

Preparing for Christmas | Five Frugal Things for November 2018

November 23, 2018

One

Low cost Christmas. If you have read any of my posts about preparing for Christmas you will know that I am cutting right back this year in order to help my debt total come down further, even over the festive period. We won’t be hosting Christmas Day this year and that will save us a lot of money alone. We have also suggested a pot luck style dinner and drinks at ours with friends on the 23rd, saving us the expense of a night in town.

Gifts do tend to take up most of the budget though. Secret Santa’s, lots of price comparisons, cashback and affordable hampers are all going towards my efforts for a frugal Christmas. Doing a secret Santa with siblings in both of our families has been particularly helpful in reducing the number of presents we will be buying this year. It will save us all a lot of money and it actually means that we will all receive something that is more thoughtful instead of something cheaper and silly.

Two

Ditching the coupons. HUH?! Aren’t coupons supposed to save you money? Well yes…if you are planning on spending money in the first place. For a while we ordered our weekly shop online from Tesco and it worked really well. We’d have it delivered on a Monday ready for the new week and the new meal plan. It would stop us from picking up things we didn’t need. We would even get regular coupons through the door saving us a lot of money.

The catch was that we had to spend £40 in order to get free delivery with many of the coupons having an even higher minimum purchase requirement. On the way home one day my better half decided to try Aldi, our old favourite. As he had no set total to reach he ended up spending a lot less than we would online.

Now that Christmas is on its way the high value coupons are coming through the door. The latest one was £10 off when you spend £70 or more. That’s great if you have a big shop planned but they won’t be enticing us. The fancy catalogue looks beautiful, don’t get me wrong. This year however, we’ll be sticking with Aldi and spending on just what we need and not a penny more.

Three

Drawing the curtains. As the nights drawn in and it gets colder and colder we’ve been closing the curtains in the evenings. I’ve just checked the temperature outside today and it is 1 degree. Brrrrrrr! Normally we would just close the blinds for some privacy but the living room feels so much cosier when the curtains are closed as well. Of course, this has the added benefit of keeping the room warmer too. I’ve written a post about saving money on your heating bills and I’m sure you know this already, but even pulling that small bit of fabric over your windows can make all the difference.

Four

Buying soft drinks. This month I’m making a lot of effort to be healthy, both to help my weight and in preparation for an indulgent Christmas. As part of this I’ve not been drinking alcohol at all in November. Honestly, I thought this would be a bigger deal in terms of the old FOMO and struggling with having a soft drink whilst friends were enjoying some wine. Honestly, the impact it has on my waist line AND my pocket has been a much bigger shock.

If, like me, you’re in the habit of having several drinks over an afternoon and evening spent with friends you will know how quickly that bar bill adds up. Often I’ll come home on a Saturday at least £50 lighter and that’s with both myself and my better half contributing. This month however, I’ve been opting for water mostly. This past Saturday alone I saved around £30 as a result. In ONE day. Whilst I will be drinking again in December the quantities will be a lot smaller than usual and I know my health and my bank account will thank me for that!

Five

Simple and affordable home decor. For a while now I’ve felt like we needed to do something with our living room. It was decorated last year a few months after we moved into the house, frugally of course, but it has always felt a bit unfinished. The cushions we had on the sofa were a bit of a mish-mash and the amazing 50s unit we have in the corner just looked a bit empty. We took a quick trip to Ikea, predictable but reliable, to look for some inspiration.

One hour, lots of walking and two portions of Swedish meatballs later and we had our answer. We came home with five cushions in a mix of dark grey and a really deep green colour which finish off our sofa and chair perfectly. We also picked up an ivy and a fern, both in simple pots which match the decor. They add a bit of life to the room and tie it together so nicely. The cherry on the cake? We spent no more than £25.

There they are, my Five Frugal Things for the month of November. You can read last month’s post here.

I’m linking up with Cass, Emma and Becky in this week’s Five Fabulously Frugal things I’ve done this week linky.

Shopping for Christmas with Just Six Weeks to Go

November 9, 2018

For some of you, six weeks until Christmas will mean you still have loads of time to prepare. The festive season hasn’t even started yet and you won’t think about it for a while. For others Christmas started back in the summer and six weeks will feel like no time at all. Anyone on a strict budget may have a different way of looking at things. Six weeks until Christmas will mean just one more pay cheque, two if you’re lucky, until the big day.

If you have read either of my previous posts about spreading the cost of Christmas you will know that I am determined to enjoy the holiday season fully prepared and without going further into debt. There is still plenty of time for you to get organised this year without having to look at your credit card or panic buy gifts.

Get organised

Santa has a list and you should too! The best way to get started with your Christmas shopping is to get organised. Make a list of all the gifts, food, drink and other expenses that will arise over the festive season so that you know exactly what you are going to have to pay for. Then add in the detail. What are you gifting each person? How much will you be budgeting for food? Do you need to have a pot ready for nights out?

Specifics really help here. Don’t just right down “computer game” for your nephew. Find out exactly which one you will be buying, where you’ll get it and how much it is. The same goes for food. Instead of writing “Christmas dinner”, list everything you’ll need. Turkey, bacon, potatoes, carrots…you get the gist. The more specific you are the more organised you will be. It will also stop you from throwing unnecessary things into your shopping basket, digital or real, and overspending.

Secret Santa with family

I have spoken about this tip previously but it is one I really believe can help the most. We are doing a secret Santa gift exchange with both sides of our family this year and I have worked out that it will save me roughly £300. That’s huge. For me, that means putting an extra chunk into my debt payments over the festive period instead of watching it disappear. Now that’s a happy holiday!

Shop around

This might sound like an obvious one, but when we are so busy trying to do everything at once it can be so easy to just opt for the gift we are looking for in the first place we see it. The more organised you are the more time you have to shop around and do some comparison of prices. A quick look on Amazon normally does the trick for me. Remember to check for voucher codes too to see if discounts are available!

Make sure to get cashback

Always remember to make purchases through a cashback site wherever possible. I normally pop onto TopCashBack to check what’s available. Most shops offer between 4% and 10% back, which can make all the difference if you are doing a lot of online shopping. If you click here you can use my referral code to sign up. It won’t cost you anything but I do receive a little bonus. If you choose to use it, thank you!

Keep the cost low

Even something as simple as putting together a hamper of a loved ones favourite things can make a big impact. I definitely recommend starting somewhere like the Poundshop or Homebargains for this kind of thing. For example, a hamper filled with scented candles, chocolates, cosy socks, stationery and a nice bottle of wine would be my dream and you could pull all of those together for £10-15 in an affordable local shop. Planning ahead of time with a list of things your recipient would love will help you to refrain from overspending too.

Make extra money

This is something I talk about a lot on my blog, but I’ll mention it again as it can make such a difference to your bank balance. Making small amounts of extra money in the run up to Christmas, and throughout the year, can add up so quickly and make a real contribution to your spending pot. You might choose to sell things on Ebay that you no longer use or need, clearing space for all of the new gifts that will soon fill your house. Maybe taking surveys would be perfect for you, or could you take some over time at work? Get creative!

Also, remember to check the points you have on supermarket loyalty cards as these could end up covering the cost of your food shop. If you have any store cards check those too, they all add up quickly. Do you have boots advantage points that could get you a lovely toiletry set for your mum for example? If you’re looking for more money making ideas, be sure to check out www.emmadrew.info.

Homemade is always a great option!

You might find that your budget is stretched to it’s limits and there is simply no room left for buying gifts without using a credit card. If you can put you hand to crafts or baking then homemade can be a great alternative. Whether you brew some flavoured drinks, bake someone’s favourite biscuits, make them some chocolate bark or even gift them something from your own garden, there are so many options. Of course, Pinterest is always a great place to look if you’re stuck for ideas!

Please remember that Christmas is not about the amount you spend and it is certainly not about going into debt in order to make others happy. Get started now and you can enjoy a wonderful Christmas without breaking the bank!

What are Cash Envelopes?

November 5, 2018

You have heard me speak about budgeting many times before on My Debt Diary. Today I want to talk about one specific method. Whilst many people choose to set up and manage their budget digitally, myself included, cash envelopes are also a popular choice. But what are cash envelopes?

What are cash envelopes?

Put very simply they are envelopes with cash in. They are a physical form of a budget with each envelope holding a designated category. Most importantly they each hold a set amount of money. You may choose to use them for items such as shopping/groceries, petrol and takeaways for example. Everyone has their own priorities and their own expenses of course.

Each month you decide how much money you will allocate to each category. You withdraw the total amount you need from the bank and place the right amount in each envelope. You might choose to hold on to enough money for just a week or the whole month. Just choose the one that feels comfortable for you. To help keep things in order it’s important to mark the category on each envelope, so they don’t get mixed up.

There are two great benefits to using cash envelopes as your budgeting method. Firstly, handing over physical money makes you think more about your spending. You watch a certain amount leave your envelope and your remaining budget diminish. It forces you to consider whether a purchase is required or if you would rather save that money for something else.

Secondly, once the money is gone it is gone. Unlike using your bank account where everything is held together there is no chipping into other areas of the budget without actually taking money from another envelope. This highlights how quickly you use up certain areas of your budget. It can also help you to budget more accurately in the coming weeks and months as you gain a better grasp on your spending habits.

What’s better, if you have money left in your envelope at the end of the month it will feel incredible. Now you can make a choice. Do you spend more on your shopping that month? Do you put it in savings? If you have debt that is the obvious choice! Even if it is only £1.50 that is left, put it somewhere. If you follow me on Instagram you’ll know how much I believe in throwing even the smallest amounts at your debt total. The point is, taking control of your money like this will give you more choices.

The cash envelope system is a great method to use if you are new to budgeting or really struggle with limiting your spending online or with a bank card. Sometimes, in order to come to terms with a completely new way of handling your finances, a new way of spending can be the perfect approach.

A Frugal Autumn | Five Frugal Things for October 2018

October 26, 2018

One

Pumpkin soup and pumpkin pie. Off the back of a very autumnal weekend we spent pumpkin picking with friends earlier in October we wanted to make the most of our orange friends. The tendency is of course to carve up your pumpkins and leave them on the front step of course, but after a very quiet Halloween last year we wanted to put them to better use.

We decided to try out some new recipes, one sweet and one savoury. Both were delicious and the ultimate comfort food for the season. Of course the added bonus is they cost us very little, having spent just a few pounds on the pumpkins themselves. Everything else we needed was already in the cupboards!

Two

Walks instead of taxi fares. As the nights get colder and darker drinks in the garden are no longer an option. Instead, we’ve been favouring the pub quiz down at our local with friends. The distance from our house to the pub is just long enough to warrant a taxi if you’re not feeling energetic. With the drinks themselves being quite affordable, or at least cheaper than your standard city prices, it’s always easy to try and justify throwing money at a black cab.

Of course it is healthier and cheaper to just walk. We give ourselves plenty of time to get ready so we’re not in a hurry and force ourselves to do the walk. It never takes too long in the end. That’s a tenner saved each night!

Three

Shopping my cupboards. At the beginning of the month I had a long shopping list of several toiletries and household things I thought I needed. Everything from cleaners to toothpaste. Minutes before going leaving to go to the shops I thought I should quickly check my laundry cupboard, just in case.

I soon realised that I had bought duplicates of most things last time I was at the shops and forgotten about them. Money saved and I got to avoid some of the busy shops I had planned to visit. In fact, I actually had multiples of some things and should be set until the new year. Make sure to always check your stash before giving money to the shops!

Four

Lunch leftovers. For years and years sandwiches were my go to lunch. Now that I live with my fiance however, we rarely buy lunch food. He is the cook in our house and when I first saw the amount of food he was cooking for just the two of us I panicked, what a waste!

In fact, it became quite a handy trick instead. Most of our dinners can be split into four portions, if not more. Two become dinner that evening, the rest becomes lunch for the next day. It means we always have something filling to eat and it saves the effort of having to make another meal which is great on a really busy day.

Five

A week in the countryside. Frugality isn’t just about pinching every penny. Sometimes it is about affordable treats. If you read my other blog, Sunshine and Rain, you will know that I have been enjoying the quiet of the countryside this week. To celebrate my Mother in Law’s birthday we have taken a trip to the Yorkshire Dales as a family.

Whilst I am on my my debt free journey holidays aren’t really an option. However, time away from work and life in general is important for all of us. We found the perfect compromise here, staying in a big house in a tiny village for just £480. For a five night stay and with ten of use here, we were really happy with that price. We have been making all of our own meals and spending a lot of time outside so costs have been kept low but the enjoyment hasn’t been compromised. It’s the perfect frugal week away!

There they are, my Five Frugal Things for the month of October. You can read last month’s post here.

I’m linking up with Cass, Emma and Becky in this week’s Five Fabulously Frugal things I’ve done this week linky.

Saving money in a piggy bank isn’t just for kids

October 22, 2018

In a previous post I spoke about a method of saving called skimming. This is the process of checking your bank balance each day and moving the small change from your current account over to your savings account. Each day only a small amount is saved but over time this can really add up. Of course, this method doesn’t work for everyone. For those who prefer to use cash, a more tactile method can be much more effective. Saving money in a piggy bank isn’t just for kids after all.

Saving money in a piggy bank isn’t just for kids

Many people who choose to take control of their finances like to use cash envelopes to pay for things. This is for a couple of reasons. Firstly it helps with sticking to a budget. The money attributed to each expense is physically placed in a named envelope making it difficult to go over budget.

Secondly it makes spending money more intentional as you are physically handing over the cash and therefore become more aware of how much is being spent at any one time. If you are left with an empty envelope before the end of the month you are required to physically withdraw more cash in order to over spend.

All going well however, you will have money left in your cash envelopes at the end of the week or month. We often end up with loose change in our pockets when paying with cash too. Whether it’s a little or a lot, having money to spare is always a good feeling! But where does it all go?!

If you are not strict with your spending, it disappears. Honestly, if I didn’t know better I would swear it was magic and I know many of you will relate to this. You have £10 in your purse or wallet. You spend £5.20 on a few things at the shops. That should leave you with £4.80. Of course, you pick up something small here and another thing there and suddenly it’s gone. All of it.

Now £4.80 is not a lot of money. It won’t cover any of your bills. It probably wouldn’t even get you a full lunch nowadays. So why worry about it? Well, if £4.80 of your spare change is disappearing once a month, that comes to £57.60. If that amount disappears each week? That means that a whopping £249.60 is vanishing from your pockets.

As the old adage goes that I’m sure all of your grandparents have repeated to you many times before, look after the pennies and the pounds will look after themselves. Keeping track of your money makes such a huge difference to your financial health. Even the tiny amounts.

Keeping something as simple as a piggy bank in your house could be the difference between watching your spare change disappear on unnecessary “things” or becoming a holiday for your family. It could mean having a worry free Christmas, or of course it could mean becoming debt free sooner!

Of course, you don’t need to use a novelty pig shaped bank. Use an old coffee jar, a vase or anything else that comes to hand. Place it next to the spot where you’d usually put your handbag or empty out your pockets. Then get into the habit of throwing any spare change in each day. You may choose to add small coins only or go as far as to adding everything other than notes. Figure out what works for you.

As with any habit, this can take a while to become the norm but be persistent and make it a normal daily practice. Importantly, try to avoid dipping into it throughout the week when you’re short for change. Remember, if you’re using cash everything should already be budgeted for. If you need to, put a lid on your jar which is hard to get off to discourage any spending.

When we were kids, being handed a pound coin was the most exciting thing. Heck, 10p was amazing. Yes as adults we need a little bit more to survive now, but I think that it’s so important that we revive our excitement in those small amounts of money. Throw all of those pennies in your piggy bank and watch how fast they grow!

My plan for retirement while I pay off my debt

October 12, 2018

My Debt Diary is a place for me to share my debt free journey. I update you every two weeks on my progress and share tips and advice as I build my own financial knowledge along the way. It is very much about what is happening now and in the short term. But what about the long term? I am very focused on my mission to pay off all of my debt, however I have to think about the future too. Here is my plan for retirement while I pay off my debt.

My savings amount will be progressive and will grow once I am debt free. Of course as I am currently focusing all of my money into my debt payments right now, it can be hard to find the funds to put away into savings at the same time. None the less, the sooner I have my plan for retirement in place the better.

My plan for retirement

The first thing that we tend to think of when it comes to saving for our later years is of course a pension. As I am self-employed my pension is not something that is set up for me automatically. Once I began making some money through my freelancing work I knew it was time to see what my options were.

For some people, looking for a pension will mean studying all of the numbers and percentages on offer in detail, looking through every provider available. For me, it meant asking for some recommendations and choosing the provider that scared me least. Some financial advisers might shake their head if they read this. You should go for the best rates I’m sure, but we all need to take our own approach.

What I really wanted was a platform that allowed me to pay in easily and keep track of my total. Knowing that I would want to increase my contribution amount as my debt total went down, the thought of having to make phone calls and apply for changes with forms and things was just not on. I need to be able to click a few buttons and know exactly what’s going on.

I currently pay £25 each month into a private pension with Nest. (I’m not affiliated with them, but so far so good). This is of course a very small amount, but it is adding up quickly. Since I started earlier this year, it has built up to £229. If I continue with this, it will grow to give me £1500 per year when I retire. That wouldn’t buy me very much of course, but that’s not the point.

The important thing is that I’ve started and now the compound effect can begin to work. I plan to increase my pension contribution to £150 per month once my debt is paid off. Whilst there are many ways to save and invest money for the future, setting up a pension was a priority for me. I will put other things in place once I am debt free, but I wanted to have a pension in place for my own peace of mind.

Do you have a plan for retirement? What have you got in place?

Victoria of lyliarose.com has written a great post about why you shouldn’t rely on a state pension and I definitely recommend you have a read!

How I paid off my first credit card

October 8, 2018

A couple of weeks ago I finished paying off my first credit card! It had been a goal of mine for over two months and I cannot describe to you how good it felt to phone my bank and close that account. As soon as I hung up the phone I did a happy dance around the kitchen. I’m not joking. Be thankful you didn’t witness those moves. For many people starting out on their debt free journey, getting rid of that first debt total might seem like an impossible mission. To help motivate and guide you, here is how I paid off my first credit card.

Figured out my debt total

Of course, this is the dreaded first step. Before I could begin paying anything off I had to face my debt total. It wasn’t fun, it wasn’t pretty and my anxiety rocketed as I checked each number and added it to the calculator. It had to be done though. In order to understand how you are going to become debt free you have to know what it is you are dealing with.

My total came to £16,814.49. You can read my Starting Point post here. My smallest debt, my first credit card, was at £586.02. If you follow Dave Ramsey’s baby steps and the debt snowball method you will know that this would be the first debt I would focus on paying off. But before I did that, I had a few other things to put in place first.

Created a budget

The next step was to figure out where all of my money was going. I did this by coming up with a budget. Once I knew where my money was going, I would be able to tell it where I wanted it to go. I feel like that is the major difference between getting into debt and getting out of debt for most people. Setting up a budget gave me control over my outgoings for the first time in a long time.

As my income is irregular I had to do things a little bit differently. My total monthly earnings change constantly, so I had to come up with a budgeting method that worked for me. You can read about it here.

Set aside an emergency fund

Next came the emergency fund. This is such an important step and one that should not be skipped. I understand that for most people, by the time you reach this stage you just want to get started on your debt payments. You have to be patient and wait a little bit longer while you save your emergency fund.

It took me around three months to save my emergency fund, which felt like forever at the time. Thankfully I haven’t had to use it yet, but it gives me such piece of mind knowing that I’m covered if anything goes wrong or my income drops drastically in the coming months.

If you have no idea what I’m talking about you can read my post on emergency funds here. In very simple terms it is a pot of money for emergencies, just as it sounds. It’s greatest benefit is that if somewhere along you debt free journey something unexpected happens, such as a car breakdown, you remove your risk of going backwards with your debt progress. No credit cards are needed to make the payments, you have an emergency fund instead.

Focused my over payments

Now we get to the fun stage! For those who follow the Dave Ramsey method, this is where the debt snowball kicks in. Whilst making minimum payments to all of my debts I threw every spare penny I had at my smallest debt, my credit card. This change in the way I handle my finances has made the biggest difference for me. Before I started to focus on becoming debt free I used to pay a little bit of a card off, then a little bit of a loan and so on. Now, I concentrate all of my over payments on my smallest debt.

Some of these over payments came from money “leftover” once I had completed my budget for the month. A lot of it came from things like selling unwanted clothes on ebay and completing surveys on Prolific Academic (my favourite side hustle) too. Everyone will find something different that works for them.

The beauty of using this focused method is that you see much quicker progress with each debt that you have and your momentum really begins to build!

What’s next?

If you have read my goals post for October you will know that I am now putting all of my focus into my second and final credit card. Using the same method as I did for my first I will put everything I have into clearing this total. Even better, I now have the money available that was going into my first credit card (a minimum payment of around £60) which means I will be able to pay this card off even faster.

Whichever method you find best suited to you during your debt free journey, having focus and understanding of your money are both key. You have to know where your money is going and you have to tell it what to do. Take control of your finances and you will make progress towards financial freedom!