My Debt Diary

The impact quitting my job had on my debt.

The transparency of the debt free community is incredible and really helps me to relate to each individual who is currently making their way through a mountain of loans and credit cards at the same time as myself. As such I want to be completely open about this whole journey. A big part of that is my income. In particular, I want to discuss the impact quitting my job had on my debt and where I am now.

My intention isn’t to send you a word of warning or anything, I just love hearing about what other people do for a living and their career progression. If you do take something away from it, even better. It’s a long one so grab a cuppa!

The Whole Story

It does make me nervous to talk about the impact quitting my job had on my debt because not only was it a very personal decision, but it was one that no-one else supported.

Back in 2015 I graduated from university with a masters degree in Advanced Architectural Studies having studied for six years and spent some of that time working on placement. The week I was due to hand in my masters dissertation I had my first job interview and I was successful. Work started the following Wednesday, the day after hand in. I had done it, I had achieved the dream of securing a great job!

Then the distractions started to happen. I’d be half way through a morning of work and find myself looking at interior design courses and “how to start your own business”. I didn’t dislike my job, my but I wasn’t as passionate about it as I had hoped. Just two months into my first job my boss called me into his office. I was doing a great job, but he needed someone with more experience he told me. The first thing that hit me was panic; I had just bought a new (to me) car with my first credit card for this job and now after two months I had been let go. I packed up my stuff, left and sat in my car crying on the phone to my mum. It wasn’t the best start.

The next couple of days were spent frantically searching job sites. I came across one that had already expired, but the listing looked interesting and the office would be really handy for me to get to. I sent off a quick email and crossed my fingers. A couple of hours later I received a reply. “Hi Emma, thanks for your email. I’ve actually already hired someone for the role but I love your portfolio. Would you be able to come in for a quick chat?”. YES, yes I would. I booked my meeting for the next day.

They loved my work so much they offered me the job anyway!  Again, very quickly after, I started working and things were going really well. I preferred this office as it happened, so it turned out to be a positive changes. My boss was great and the work was more interesting. Oddly, I was still distracted by other things. Courses like how to start a blog and how to build an Etsy business would be hidden on a tab behind my work. None the less, the work was good.

As the weeks progressed I continued to enjoy the work, however I would find my mind wandering constantly. Sitting in the same seat every day doing the same work was starting to get to me. Many of you will be thinking, yes Emma that tends to be how jobs work. I didn’t have an immature attitude to working, but I had started to recognise that I wasn’t keen on this set up.

At the three month mark I get called into the meeting room…here we go again. As it happened, it was really good news. My boss was offering me my contract. He wanted to make me a permanent employee! Incredible…so why don’t I want to sign it?! I thanked my boss and took the contract and then didn’t touch it for a week. When he chased me for it I made my excuses and did nothing. Then I asked to speak to him. I had taken the time to think about things, I said, and I was very grateful for the opportunity, but I wasn’t going to sign the contract. In fact I was going to be leaving. I didn’t want to be an architect.

My boss was stunned, my family and fiance were stunned when I spoke to them about it. Honestly I was a bit caught off guard myself that I had said it out loud. I had worked so hard for so long for, but it just wasn’t clicking.

For the next couple of weeks as I worked my notice I made an attempt at putting a plan together. Earning money was of course the main focus. In my head I had decided that I was going to sell wedding stationery. It would all be designed on Photoshop by myself and then sent to the printers before being posted to the customer. Wedding stationery was expensive so I could make good money quickly from this.

In reality, I was starting from scratch with no business experience and no understanding of marketing. The day I began my wedding stationery “business” I was so full of enthusiasm and motivation, but as the days went on and the money wasn’t coming in I started to crumble. My face always said everything is great, because I had convinced everyone that this was a good idea, but inside I knew it wasn’t working. I hadn’t prepared and that was plain to see.

Now this is a debt blog and I imagine that you can see where this is going. I mentioned before that I had just bought a car. That had to be paid for. I also had a phone and other expenses. They require money too. For a couple of months I was able to live off of the wages that I had earned in the architect’s office, but they began to dwindle.

The very worst day I can remember was waking up one morning with the intention of getting on the bus to travel twenty minutes away and having to ring my dad for a lift because I couldn’t pull enough change together. All I could find were a few 10p coins in my purse and some coppers from the sofa.

Still trying to fool myself that money would come in eventually I used my credit card here and there for little things. Then I got close to the limit…then I reached the limit…then I had to get a second card…and so you see where my debt reared it’s ugly head. From here the nasty snowball of payments and panic took hold and I knew something needed to change.

I feel like I have gone on for long enough now, and I have definitely shortened the story, but this gives you a good idea of the steps that I took to get me to where I am currently with my debt total. The positive I can take from it all is that I have learnt a lot. The naive and ignorant me from three years ago is now a very different person.

What do I actually do now?

In one of my first posts, Debt Payment Progress – The Starting Point, I briefly shared some insights into my work.

I now spend my days freelancing. In what you might ask? Architectural drawing of course. After taking several months to explore different avenues, some OK and some dreadful, it was pointed out to me that I do have a strong skill set as a result of my degree and the time I have spent in professional practice.

I stripped away all of the expectations of a big architecture firm and qualifying as an architect with a fancy title and looked at the straightforward options that I had. Freelancing was one of them. It would be possible for me to be my own boss, work from home and set my own hours. I could breathe again. Just like that, I felt like I had control back.

The journey from that point has been a tough one, I can’t lie, but it was the right one for me. I could definitely share more on the last 18 months in a future post if that would be of interest for anyone looking into freelancing as an option. Just let me know in the comments.

If you have reached the end, thank you so much for taking the time to read. It is a lengthy story but it is such a key part of my debt journey.

the impact quitting my job had on my debt - pinterest

Can survey sites and Ebay sales really pay off my debt?

If, like me, you have a pile of debt that you are looking to get rid of you have no doubt started the hunt for new ways to make money that will allow you to pay off your debt as soon as possible. You want it gone and you need ideas.

So many money making blogs will provide you with an abundance of tips and tricks, from ensuring that you cancel all of your unwanted subscriptions to taking on six more jobs to earn those extra pennies. OK six might be an exaggeration, but you get the idea. Two suggestions that come up every time without fail are try survey sites and sell your unwanted things on Ebay. But can these really make you enough money to pay off your debt?

Can survey sites and Ebay sales really pay off my debt?

The short answer is, yes.

Don’t get me wrong. I understand why people question it. You’ve found a t-shirt you don’t wear much anymore and popped it online for a fiver. After fees and postage you’re left with enough to buy you a sausage roll if you’re lucky. Then you try a new surevy site and after getting chucked out ten times and earning 15p in the process you figure it’s not for you.

Here’s the thing. It’s about more than the odd t-shirt sale. You need to look past the initial frustration and see the bigger picture. Figure out which sites work for you with some trial and error. Once you click with one or two you’ll be off. Have a bit more patience with it and you will begin to see progress, I promise.

OK, what are my options?

When it comes to selling, there are loads! We all know of the old classic Ebay. It’s straighforward to use and has a huge customer base, so you know your listings have a good chance of selling! Girl on a Pension has written a great post filled with tips for new Ebay sellers.

Have you thought about using Facebook or newer apps like Shpock? Each one is definitely worth a bit of research, but from experience a good piece of furniture can be sold within the hour on Facebook marketplace as it is so accessible to so many people, whilst Shpock seems to really suit smaller items like clothing and shoes.

This post by Wotawoman Diary provides a great indepth look at online selling to get you started and the tips are transferable to all selling methods!

Spend some time researching your options and weigh up the fees and ease of use of each. Maybe put an item or two on each and see which you prefer. Once you have one you enjoy using you’ll be far more motivated to make the effort!

The same goes for survey sites. There are so many available now it’s mad and they are a great way to make money.  From experience however, some are far better than others. My personal preference is Prolific Academic. I spoke about it before in this post. It’s easy to use, and once you’ve gone through all of the prescreening questions you’ll only be sent surveys that are relevant. That means you’ll never get kicked out, hallelujah! In the last month I have made just short of £50 with this site alone.

Commitment to the cause.

I apologise if this causes offence, I don’t mean to question the importance you give to your finances…however, having been through the stages of “debt’s normal” and “oh it’ll be fine” I do understand the feeling of not wanting to put in the extra effort for the sake of a couple of pounds. It feels like a lot of work when the payout maybe isn’t the highest.

It’s definitely important to consider just how important being debt free is to you. The harsh reality is that the more priority you give something, the more likely it is to happen. This is particularly true for debt as it is such a challenge to face and an unpleasant one at that. When you really want something, you’ll work for it. You’ll stop seeing frustrations and hurdles and start seeing opportunities.

The compound effect

This is the one simple detail that convinced me that survey sites and ebay can really pay off my debt. Lots of small things can add up to something incredible. This is called the compound effect.

The other day I made £3.27 from selling a top. I consider that a small amount of money. It could just about cover a coffee.

But then we take the more open minded perspective. If I were to make a sale like that every day of the year, that tiny amount becomes £1193.55. Now that’s a significant amount of money! What if I was to add to that £1 worth of survey earnings for each day of the year? Well that’s another £365, so the total is now £1558.55. Would that help you to pay off your debt? It would help me!

With this sort of progress comes motivation, and it is incredible what you can achieve when you’re motivated! Dave Ramsey (author of the Total Money Makeover) has a famous saying, “Sell so much stuff the kids think their next”. Your mindset shifts when you start to see results and you begin to see opportunities to make money everywhere.

Yes, survey sites and Ebay sales really can pay off my debt!

Keep it simple. Find what suits you, work at it, build momentum and then really watch the numbers grow!

 

Can survey sites and ebay really pay off my debt - pinterest

 

Debt Payment Progress Report 1 – 06/07/18

Every two weeks I will be sharing my debt payment progress report with you. I’ll share my new debt total and all of the things I have done to make this happen. I think this is important for two reasons. It will help me record my journey and share with you what works and what doesn’t. It will also help me to stay motivated!

My new total!

As of July 6th 2018 my new debt total is £16,662.42

That means I have made less than 1% progress so far. It is a tiny amount. A total of £151.87 in two weeks. But it is a step in the right direction! (I should note that I have paid in more than this, however some money has gone straight to interest, which is why the numbers below are larger than the net amount that I have paid off)

How have I made this progress?

As I am in the early stages of paying off debt I only use a handful of money making and money saving methods at the moment. Here are the ones I have used this past fortnight:

  • freelance work – £150
  • prolific academic – £38.95
  • ebay sales – £48

Of course my main income method has been freelancing. (I’ll talk about this more in a future post) I have to say though, this month has been incredibly quiet and my income has been far lower than normal. It makes me happy that I’ve been able to pay off so much, given the low income!

Prolific Academic is another income method that I have been using for a short while now and I love it. For those of you who aren’t familiar with it, Prolific Academic is a survey site that offers a good variety of well paid, interesting surveys.

The best bit in my opinion, is that they never chuck you out mid survey, which often happens on other sites and can be so frustrating. You have to go through so so many prescreening questions at first, but push through. This makes sure they send can you relevant surveys. The more questions you answer, the more surveys you’ll receive.

Some days ten surveys pop up, other days I’ll be lucky to have one. The key I’ve found is to keep the page open in a tab when I’m working and check on it every hour. I made £25 in one day last week alone!

I have a referral code if you fancy trying it out: click here. I receive a small kick amount of commission from your first withdrawal with no extra cost to you if you decide to use the link, thank you!

Reflections for the next two weeks

As you can see, my income making methods are few and far between at the moment. My goal for the next fortnight is to expand on these using new apps and websites so I’ll let you know how I get on. I’m also looking into new methods of saving money where I can. If you have any recommendations, do comment them below!

This post may contain affiliate links

What is an Emergency Fund?

At the beginning of the month I set my goals for July 2018. One of the major targets I included was to set up my emergency fund. Those of you who have been a part of the #debtfreecommunity for a while will know exactly what I’m talking about. But for those who are new to the concept, what is an emergency fund?

What is an Emergency Fund?

Quite simply put, an emergency fund is a cash buffer. A pot of money that you set aside for a rainy day.

Whilst on your debt free mission, it’s natural to want to throw every single penny you have at your debt payments. You want the total to go down as quickly as possible! One hurdle we all face at some point however, is the appearance of unexpected payments. Unfortunately life waits for no one and no matter how careful we all are things pop up that we don’t plan for.

Before you get on your way with debt payment it is important to take some time to set aside some money for this very occasion. Dave Ramsay, author of The Total Money Makeover recommends that you save £1000, or £500 if you are on an incredibly tight budget or low income. (His book is an incredible financial guide and one that I will talk about in more depth at a later date.)

Whilst in the process of saving your emergency fund it is important that you still make all of your minimum payments to credit cards, loans and other forms of debt that you have. The sooner your fund is in place, the sooner you can give your debt your full focus. Once you’ve completed your emergency fund you can progress with debt payments knowing your safety net is in place.

What should I use it for?

That horrible morning when the boiler breaks down on the coldest day of winter. The dread of hearing your car give up on the way to work. An unexpected loss of income when have urgent payments to make. All of these fill me with panic when I look at an empty bank account and know anything could happen that I haven’t prepared for.

This is what an emergency fund is for. You will feel a huge sense of relief knowing that you have a pot of cash which is easy to access and can dig you out of that horrible situation immediately.

What should I NOT use it for?

Your emergency fund is NOT there for days when you’re a bit tight for cash. It should not be the go to when you have the January blues and fancy an “emergency” holiday and it is absolutely not to be dipped into for that quick coffee because “it’s fine, you’ll just pop the money back in when you get paid”.

This can be really hard to deal with in moments of weakness when your mates are off out for dinner and you hate missing out but it is so important to stick to your budget and keep your emergency fund for emergencies only. It will be tough but you will be so unbelievably grateful for the pot of money that saves you on a day when you really do need it.

Where should I keep it?

Your emergency fund should be liquid. In other words, it should be in a savings account or current account that is separate from your day to day spending money but still easy for you to access. There should be no penalties for withdrawals. It should be accessible immediately in case of, you’ve guessed it, an emergency.

What do I do if I have to use it?

Top it back up again. It is as simple as that. Once the emergency is dealt with, your emergency fund might be a few pounds down or it might be completely empty. Pause your debt payment and go back to minimum amounts temporarily. Then top your emergency fund back up to the £500 or £1000 that you originally had. Knowing how much it has saved you in an emergency will make it all the easier to fill up second time round!

Charlotte Musha has written a great in depth post about the emergency fund, baby step one, from Dave Ramsey’s perspective in this post. 

what is an emergency fund - pinterest

This post may contain affiliate links.

My Goals for July 2018

My first goal setting post!!

This is the bit I get excited about. I LOVE setting goals and making plans and writing lists. It always gets me motivated to get a move on and take action. What I would say though, is that I do often find myself losing motivation and chopping and changing my goals quite often too and so this is something I need to bare in mind and try and try and tackle. Here are my goals for July 2018.

My goals for July 2018:

  • Save £500 for my emergency fund. Anyone who has been in the #debtfreecommunity for more than five minutes will understand the importance of having an emergency fund. Add to this the unpredictability of being self-employed and this is a vital first stepping stone for me!
  • Put £1000 into debt payments. I want to make a good start on my debt payment this month. Once the emergency fund is in place, the first £1000 is going straight to debt!
  • Find one new income method. As you will have seen if you read my Starting Point post here you will know that I currently only make money from my freelance work and through Prolific Academic. I want to diversify my income so this is an important one this month!
  • Take time to nurture my mental health. The main focus of this whole journey for me is of course money and debt payment. What I have recognised however is that I need to pay attention to my mental health if I want to remain motivated and productive. I’m not sure what I will be doing yet and how I will be looking after myself, but it’s something I want to spend some time on. This is definitely a topic I want to explore in more detail in a future post.

So there they are, my goals for July 2018. I’ve kept it simple with just four. I think the fewer I set, the more focus I can give to each and the greater chance I have of achieving them all!

My Goals for July 2018

You can find my lifestyle blog Sunshine and Rain here, where I chat about my more day to day, non-financial goals.

This post may contain affiliate links.

You Need a Budget

You need a budget!

It seems to be the start of so many plans, guides and books when it comes to getting rid of debt or living frugally. You need a budget. It makes sense to me, but I have one major hurdle. I’m self employed and don’t have a regular income.

As I shared in my welcome post here, my work is all freelance and my income varies dramatically from £500 some months to £2000 in others. This means that there are days when I’m going to be able to throw entire invoices at my debt and some where I’ll be scraping together the pennies just to make sure I have a tenner in my pocket.

How does a budget work?

From what I understand so far, the classic and most common way to use a budget is to begin by noting down your total household income for one month. You then note down all of the outgoings you expect to have. Mortgage or rent, bills, utilities, food shopping, travel expenses should all be included here. If you’re being very good you will note down every single possible spend down to the odd coffee you might pick up at the weekend.

The aim of writing everything down is to show you exactly where your money is going. This then allows you to adjust spending and of course reduce spending if necessary.

If you’re on a debt payment journey like I am you might adopt an even stricter approach. Dave Ramsey speaks about telling every single dollar (or pound) where to go. Your finishing balance should be £0 once you have completed your budget. This means that all outgoings are accounted for. The remainder of your money is then going straight into repayments on your debts.

It sounds so straight forward!

It really does sound straightforward. It’s a very simple and sensible method to begin to get your finances in order. I definitely know it in principle. It’s the application of it to my own form of income that I’m currently having difficulty with. My focus this week is to get all of my numbers into order and find a system that works for me. My income may be variable but my bills are always the same. That’s my starting point.You Need a Budget

Take a deep breath. You need a budget, and it doesn’t have to be impossible to tackle.

For a fantastic, in-depth look at what to do next jump over to Managing Your Monthly Budget by Sue Foster