Debt - how to reverse

[MistySkiesAreGone]

How to make the switch from being an over spender to being a budgeter?

I could write a lot more about my situation but hoping there is someone wise who did it and can please just tell me their story of how they did it 🙏.

Thanks for jogging me on this.

I went swimming this morning with my swim membership, it has been so long I was so tired after and slept for 4.5 hours! I have folic acid deficiency at the moment which is unsurprisingly a result of poor diet, the symptoms of which do not make thinking clearly and the whole budgeting thing easy, but I have to start somewhere even if it feels overwhelming.

I've gone through and categorised last month spending, this was a typical month, and what is clear to me is that I am spending about £500 a month on crap.

That is a ridiculous amount over a year and leaves me no money to have a life or plan for the unexpected.

I live in a triad between a expensive supermarket, high street coffee shop, takeaway and a pub.

My spend is like:

Supermarket £200 - this should be £100. I need to meal plan and go to the budget supermarket.

Coffee shop £75 - Go once a week for tea, £12 a month.

Lunches at work £80. Take my own and buy nuts and seeds for snacks.

Pub meals £40. Cut this out.

Takeaways £30. Meal plan better.

Clothes £100. Limit to budget essentials and things that are falling apart.

Interest £30. Getting out of my overdraft will save me £360 a year.

The rest was holiday spend (could have budgeted better), travel for work, birthday present and parking.

The coffee shop is an easy switch so I can do that straight away. Also taking my lunches. And I need a system for meal planning.

I've just signed up to Hyper Jar which is a free prepaid card and has an app so I can budget in categories. I've tried envelope budgeting and it's good but I always found it a pain to withdraw cash and get the right change. I think the first step is just to get a handle on the spending.

I went straight in and looked at my bank account every day.
This focuses your mind on what is actually spending and I check what’s due out -
I also ‘go broke’ at pay day and don’t buy anything until the end of the month that is a splurge - new top for example.

If you are normally skint at the end of the month do the reversal.

Also - put savings away when you’re paid so you have less money to start with - you can transfer some back if you need to.

Love the nice round numbers @greenspaces4peace . I think a regular transfer would be good.

CHange this to yellow label/on offer food, and be creative with what you get.

Also look at batch cooking, I got given some partridges, cooked them with some veg, and served half & froze half. Found some sell by date reduced pears and froze with adding to this casserole in mind. Popped it all in a huge casserole, added herb garnish, served with loads of veg and it became a posh looking dinner for guests.

Id move my bank account a couple of times . NatWest will give you £200 for moving to them and you don’t need to stay. Then I’d move again to first direct which will net you around £175 atm and a £30 gift card. Then I’d set up a regular saver account . The maximum you can save a month is £300. It pays 7% interest. You will get great joy from seeing the total increase.
NatWest will give you £200.
Then I’d set up a topcashback account and refer all my friends and get the £30 referral fee.
Charity shops for a quick shopping fix. Car boot sales ?

*regular saver account is with first direct. NatWest offer 6% but only on a max of £150 a month

And ignore the random NatWest like in the middle . I moved it to the top and forgot to delete it !

I've had quite an expensive day, as I stocked up on things to make high protein flapjacks (and avoid spending £3 on those stupid carb killer bars), and nuts for snacks, and toiletries. My next food spend should be very low though £5-2p

£10

Planning is great! Will you prepare them ahead of time for the week?

Do you impulse buy? I heard something recently, more related to giving up smoking, said wait 5 minutes. So if you are in a shop put things down and walk away. Then if it actually necessary go back to buy it. If not necessary keep walking.

Online shopping, remove card details from websites. Put bank cards and credit cards away. If you are browsing online and have to go to another room to get your card you’re not likely to bother.

@greenspaces4peace I did indeed bake 24 of them. There are 23 now as they were very tasty.

@MistySkiesAreGone well done!

Sounds like you've got a good plan going. If you want more, read or listen to You Need a Budget (YNAB). The principles have hugely helped me get control of money, get rid of debt and generally made me feel less stressed. There is software you can buy and it's def worth it but you could see if the idea of it resonates from the book. You could then do a version of it with Monzo pots (or any other bank that does similar).
Basically it's about only allocating what you have - give every pound a job till you next get paid. And having priorities for your money! It's been game changing for us!

I've relooked at my long term plans as this always helps. I think I was just chucking lots at my pension and didn't bother with day to day budgeting. Plus I had some big expenses last year. I'm going to reduce the pension (still paying over and above though) and I have made some alternative savings plans. One is very long term so I could potentially buy a car outright in future and have some spare cash for any health issues in later life. The other is shorter term as I'd like to do a course in 3-5 years time. I've also looked at regular and one off expenditure and I am going to make pots for these.

I had some very fortuitous luck as I thought my mortgage expired in May but I checked the documents and it is October. So I am on a low rate until then, 1when it will go up about 30%, which gives me time to build up my pots, and pay off more of the credit card.

My spend has gone down. I did spend £6.95 on work lunch but I was working late. My train was less that day so it balanced.

I'm looking at highly nutritious but cheaper foods. Chicken thighs are brilliant, with skin on as I read collagen is good for skin - my excuse anyway! They will be a regular in my basket. I batchcooked up roasted sweet potatos to have with a piece of fish and veg - no effort weeknight dinners. Also tinned sardines once a week inside roasted peppers with Parmesan, that is super cheap, and full of goodness.

Just a quick one, not read the whole thread but I've recently taken control of my spending. I have a monzo account which has different pots, and when my wages are paid in, I've set it so it automatically puts the budgeted amounts into the separate pots. I've one for travel, food, spends, savings. You can set up virtual cards to pay directly from these pots in Google, Apple or Samsung pay. It's really keeping me on track as I know exactly what I've got for each thing. Visuals work best for me.

One of the pots is an ISA and has the money I would have spent on tobacco as I recently quit smoking. That's next year's holiday fund.

Setting up pots is a good idea. I use revolut. I have vaults for
Eg: car insurance, back to school, Christmas 2023.
I figure out how much each bill costs yearly. So, car insurance £600, back to school £240 (for example)
Then divide these by 12. So each month I put £50 in the car insurance, £20 in the back to school etc
Each month on the 3rd ( to allow a bit of wiggle room) I transfer over enough money to fund the pots. By the time the car insurance is due the money is there. Come August there's enough money to buy all the uniform, books and so on without having to scrabble.

I started with just one bill and as that freed up cash in my current account I added more. Now I can pay all my bills up front

Yes I never thought the need to do it but as I bought a car last year for the first time the thought of being hit with insurance or a hefty service makes it essential. I will check revolut out.

Well done on quitting @Mabelface . I did look at Monzo but I like the linked saver I get with my bank. Although it could be a way of managing spends if Hyper Jar isn't right. I had lots of little savers with Tesco which I like as you can give each one it's own name and set a goal.

This thread has helped so much and I haven't even finished reading all the advice, that is my fun for late Saturday night! I'm not normally good at asking for help and reaching out, I tend to feel ashamed and embarrassed and like everyone else has it sorted, but I'm glad I was able to truly accept I needed and wanted to change.