money

Finance Book of the Month – Money and Mindfulness: Living in Abundance

August 13, 2018

As I make progress towards becoming debt free, I am making it a priority to educate myself more about money. I want to have a better understanding of handling finances, financial mindsets and many other useful topics. My favourite way of doing this is reading. This is a part of my journey that I’m particularly keen to share with you as I believe you could get a lot of value from it. Here is my finance book of the month.

Finance book of the month – Money and Mindfulness: Living in Abundance

This week I would like to share a book that I first read around three years ago. I don’t believe that it is well known in the debt free community, however I think that it is incredibly relevant.

Lisa Messenger, the author, is the founder of the global brand the Collective and launched a magazine that has been sold in 37 countries. It is deemed an incredible success and has made an outstanding profit…and she funded it entirely from her own pocket. I should add that Lisa did not come from money, she just found her own way of doing things.

Lisa demonstrates that normal is not always best. After all debt is “normal”, and we all know how we feel about debt!

At the very beginning of her book Lisa challenges the taboo of talking about money, and this is what first drew me in. For those of us in debt, the thought of having an open discussion about it can make your knees shake. Following our debt free journey what then happens when we find that our financial health continues to grow? Perhaps we begin to do rather well with money and become what is considered “well-off”. Would we be OK talking about money then? Well of course not, that would be boasting.

Lisa explores this ridiculous attitude that the world has towards money and encourages us to think positively about it. It is OK to have it, it is OK to enjoy it and it is OK to want more! In one of the opening pages of the book she states “I love money, not because I dream of having a driveway full of fast cars and a closet full of designer outfits…but because the moment I stopped seeing money as the root of all evil and saw it as a fuel of fulfilment, everything changed for me.”

As a result of such a negative experience with money, many of us may struggle to come out of the debt cloud with a positive outlook towards the wealth that we may be about to build. Money and Mindfulness opened my eyes to having money as a positive thing. It also suggested that the goals we set for ourselves and our finances in the future are entirely achievable, whether that means having a comfortable amount in your bank account or earning millions. You don’t need loans from the bank or years of experience in business. What you need is a level head and a healthy attitude about success.

Currently, I see very little of my income go towards enjoyable spending and the concept seems so foreign. As we move towards becoming debt free, it is so important to become familiar with having money that does not disappear straight into a credit card payment or loan. The transition might be a tricky one for a lot of us, but this sort of preparation will be a big help!

You can find Money and Mindfulness: Living in Abundance here on Amazon. (This is an affiliate link. I receive a small commission at no extra cost to you if you choose to use it. Thank you!)

I absolutely encourage you to begin reading (or listening to audiobooks) as part of your debt free journey. Not only do you learn something as a result, but it also allows you some time to switch off from your debt and all the other goings on in life and just focus on the book in hand.

You can read my previous Finance Book of the Month post here.

Debt Payment Progress Report 3

August 3, 2018

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 August 3rd 2018 my new debt total is £16,243.60 (My starting debt total was £16,814.29)

In the last two weeks I have paid off £248.72. This is £70 more than I paid off in my last progress report so I’m really really happy. After a slow start to my debt free journey I feel like I’m starting to get some traction.

(I should note that I have paid in more than this, however some money has gone straight to interest. This is why the numbers below are larger than the net amount that I have paid off. I have also been putting money into an emergency fund.)

My new total debt payment to date is now £571.32, which I have calculated to equate to 3.3% of my debt total.

How have I made this progress?

Quite simply, work has been far busier over the last two weeks. I have made a very small amount on ebay and Prolific Academic, I can’t complain, but 99% has come from work. I’m so grateful to be able to say this. After a very quiet June and July it is so nice to have a regular work flow again.

Reflections for the next two weeks

Now that I’m getting into the swing of things I just want to keep going. I’m building momentum between the increase in work, small side hustles and writing the blog. My speed is picking up and I’m really getting to grip with paying off my debts. The trick now is maintaining this momentum. If you have any tips for me do leave them in the comments below!

You can find my previous reports here:

Debt Payment Progress Report 2 – 20/07/18

July 20, 2018

My new total!

As of July 20th 2018 my new debt total is £16,492.32 (My starting debt total was £16,814.29)

In the last two weeks I have paid off a total of £170.71. At first when I worked this number out I was disappointed. It’s only slightly higher than my efforts last week and it’s such a small amount in comparison to my total. It’s still an amount though and that is what’s important! I’m still reducing my debt.

(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. I have also been putting money into an emergency fund.)

My new total debt payment to date is now £321.97, which I have calculated to equate to 1.9% of my debt total.

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. It is a goal of mine to expand on these in the coming weeks. Here are the ones I have used this past fortnight:

freelance work – £225
prolific academic – £16
ebay sales – £22

Of course my main income method has been freelancing (I’ll talk about this more in a future post) and I have some good news; I’m getting busier again! I mentioned last week how quiet I had been and it was getting to the point of becoming a serious concern, however the work load is now returning to normal.

Projects are still being completed and invoices are still being processed so it will be another week or so before I start to see a little boost in my income but I know it’s coming and that’s what matters. I’m hoping I can may off a larger amount in time for my next debt payment progress report as a result!

Prolific Academic is an income that I have spoke about before so I won’t go into detail again. If you’d like to read more you can find my thoughts in this post here. 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

I definitely need to stop putting myself down if my total payment for the fortnight seems small. The important thing is that I am making progress. The process of updating you with each progress report is definitely helping my motivation and reminding me that my debt total is getting smaller and that is what matters!

You can find my previous reports here:

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

July 9, 2018

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!

What is an Emergency Fund?

July 4, 2018

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.

This post may contain affiliate links.

You Need a Budget

June 27, 2018

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.

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