A support thread for people paying off debt #2

[moneyworries9]

Hi all... hope you manage to find the thread?

The last one seemed to be such a success 😃 I will be honest and say that I haven't cleared as much as I would have liked but I know if I hadn't been on here, the debts would most likely have increased rather than decreased. I currently owe

£3,355 - loan
£1,600 - credit card

We do have some cash in our bank accounts. I'm in the process of paying for driving lessons so have about £1,000 in our current account, most of which is to cover that.

On the plus side, when I started the other thread, I had around £2,500 on my credit card and £3900 loan so I'm taking baby steps in the right direction.

The other thread was a huge source of support and motivation for me and I hope that this one will be for many others.

Feel free to give a quick summary to introduce yourself

Hi Tiddled and welcome, there is definitely room for you. You have a plan so that is good.

Well done Greying that's fab plus savings - such a good idea to have a fund to dip into rather than getting deeper in the red. That is one of my resolutions.

Mine has gone up unfortunately, again! Plus it is by dipping into the overdraft which is the most expensive way of doing things but should come down now.

balance 24,900

Thank you everything is so expensive.
My husband works in an industry that completely shut down at the start of covid and was (thankfully) furloughed for a long time . It’s been a massive wake up call and we need to get ourselves sorted . Previously we have taken out loans to clear the cards and then just ran them up again . I’m hoping this way I’ll break the cycle

End of Jan check in.

Additional money in this month in the form of a refund from a cancelled panto; so decided to be wise and use this to pay off the balance on store 2.
1st debt down.

Current totals:
CC1 - £1050
CC2 - £690
Store 1 - £570.29
Store 2 - cleared

Savings still remain at £0 and I've an expensive 2 months coming up with dental work, but hoping I can keep chipping away at the debts.

Well done to everyone chipping away at clearing their debt. I've been in a DMP for about three years and hope to be debt free in 18 months time, including my student loan. Can't imagine a life where I don't owe any money! Currently my debt stands at about £8k, down from £24k. It's been a hard slog but there is light at the end of the tunnel now

Well done Tiddled, from 4 areas of debt to 3. That must feel so good!

Lolo Your achievement is fantastic 24 to 8 - you have come such a long way - it is so encouraging. I know what you mean about not imaging life without debt. What a feeling that will be.

Mine has come down to 23,500 (onwards and - downwards, hopefully)

It’s been a while since I checked in - but debt started at 28,000, now at 18,300.

Have around 2 more years to go but they will be tough as no emergency find and some expensive items coming up (kids birthdays, school trips etc).

Determined to keep it coming down though. Well done to everyone on this thread.

Long time lurker here. Down to £16.5k, from £24k. I think I have 2 years left until I can clear it. Well done everyone on your progress.

Keep going MakingProgress and well done. A few of us are hoping to have it all paid off in around 2 years.

DuchessMinnie welcome - that's fantastic progress.

Do people recommend the snowball or avalanche method for clearing debt?

Does anyone on here have experience with tax credits overpayments please? Wondering if they can be added to a DMP...Thanks

Well done to everyone , some great progress.
Update this month down to 2609 . ( don’t know why but it’s feeling like hard work lately I need to keep up motivation)
I’m aiming for it to be gone in 2 years as well
Thinking different I had to Google the avalanche method , only ever heard of snowballing ! For me I’d need the small wins from snowballing but theres more financial sense in the avalanche ( sorry not much help I know )
Oranges and lemons we had a small overpayment this year but it will just come out of next years award so I’m not really looking at it as money owed .

Thinking - It's a difficult one. As I understand, it the avalanche method is quicker in reducing the length in months of debt as it tackles the high interest areas of debt first so I believe less interest is accrued thus paying off quicker. However, psychologically, apparently the snowball method (lots of info with Dave Ramsey online) works because it reduces the number of debts more quickly so motivation is maintained - being able to draw a line through debts one by one.

Many (?most) on here I believe have used the snowball method really successfully.

Personally though, If I received a small windfall, I'd throw it at my larger interest areas - (overdraft I'm looking at you) as the interest rates are eye-watering and hate seeing that being added each month.

Greying - well done - another chunk off ! that's brilliant.

I’ve made a small payment just to see it in the 500s 😀, so is now 2599

I would like to join if I may. We were doing ok financially, but a few big overspends on jobs improving the house, a reduction in incoming money and bills going up means I am in debt. The amounts below:
PayPal Credit balance: £3412.14
Credit card (0% for 12 months): £2500
Overdraft: £550

A month ago the PayPal balance owed was £6600 or so, I have sold a lot of things online and thrown an entire pay check at it, plus taken out the interest free card to shift some of the high interest debt so I am not fighting so much of a losing battle.
I can’t pay any more this month, but my plan is to hit the PayPal balance with £500 each month until it is gone, before hitting the credit card before the interest free period runs out. I recently got a job after being a SAHM, so it is feeling manageable but has kept me awake for a few months prior to gaining employment.

Welcome sewing. Unfortunately, I know how easy it is to get into debt and it inch up. Well done on selling online though, really helping towards the incredible drop of over 3k on the PayPal. You also have some breathing space with the credit card 0% while you tackle the others.

Update today 2499
I don’t know if it would appeal to anyone else but I just wanted to share something I’ve been doing .
When I first started paying it off I made a grid of 100 squares ( 10 by 10 ) I worked out 1% of my debt (in my case £55 ) every time I pay that amount i colour a square in . I can now easily see I’ve paid 54%

Afternoon!

Can I join you?

I've NC'd for this as I'm quite recognisable / well known under my usual name, so don't want to use it.

I've had an epiphany, I suppose, this year and want to get rid of debt I built up for many reasons. Some stupid, some circumstantial after having babies / low earnings etc.

Anyway, enough excuses.

As of yesterday, I've paid off £2,064.00 from my MBNA card since the January statement and it's now at £0, so that's my achievement in the last 2 months.

My debt is now:

Lloyds credit card (0%) £1,708.18.
Tesco credit card (0%) £3,564.00.
Lendable loan £7,590.68.
Lloyds loan £10,223.58.

I'm (kind of) snowballing (MBNA's 0% ran out first, so I paid that first), not avalanching, as I want to pay the credit cards off before I start paying interest (as much as possible; only a Tesco balance will need transferring to a new card next Feb to avoid interest).

My aim next pay day (I'm doing loads of overtime to make extra to pay debt down) is to get Lloyds down to £1,000.00, then pay £200 per month to finish paying in Sept. Then throw money at the Tesco card / reschedule the loans to more favourable rates.

If I keep the loans as they are, I've 3 years left til I'm debt free. Hopefully I can lessen that.

Little update from me. My husband (with the better credit rating of the pair of us) took out an interest free card to shift the PayPal credit balance before they started charging compound interest. Current picture is:
PayPal debt: Cleared
Credit Card 1 (12 months interest free): £1975
Credit Card 2 (12 months interest free): £3625

Total £5600 owed. Feeling positive, but a bit worried about spiralling energy costs scuppering the plans.

Hi becomingdebtfree and welcome.
Well done sewing . I’m worried too about spiralling costs of everything. It just seems never ending doesn’t it ?
Anyway my update today is £2445 . Made a smaller payment this month as I’m expecting money to be a bit tighter . Will hopefully make another payment later in the month ( is still more than the minimum though which is a bonus I suppose)

I'm snowballing, but small word of warning. If you only pay minimum payment on some of your cards, they ask for boost payments on them. So occasionally go and pay off a bit extra on others.

I am using what's the cost for snowballing and my target date is Jan 2024, however as my car finishes getting paid in March 2023, I will use the extra to snowball my cards. Really trying to stick to a strict budget with wiggle room for emergencies.
Not replacing the car, it's passed every MOT so far, and I checked the selling price of similar cars, and is exactly what I paid for it 4 years ago.

Welcome Becoming - you have a solid plan, that's good. It feels good to cross of a CC debt.

Well done to all for bringing the balance down.

Mine has plateaued it seems but feeling hopeful for the rest of the year to get back on track and still have things paid off by Dec 24.

Well done everyone. We are doing great.

it’s hard to keep the motivation up in the middle stages I find - feels like slogging through mud.

I?m down to total of £16,700, from £27, 800 last year. On track to have it paid off by Feb 24, but have yet to see how rising living costs and utilities will affect that.

just trying to keep on keeping on.

It's definitely a slog, isn't it? I'm motivated to do it, and keep jiggling finances round so I can try to pay things faster, but I definitely have more regret than I've ever had right now! And I'm nowhere near the middle yet.

You're doing really well, MakingProgress.

Pay day today, so I'm now at:

Lloyds credit card (0%) £1,041.63 (min payment mid-May will take this down to my £1k target.)
Tesco credit card (0%) £3,504.31
Lendable loan £7,404.29
Lloyds loan £10,023.59

I'm hoping to get Lloyds down to £300 next month, then paid off the month after. Tesco will then be in my sight!

Makingprogress that's an incredible achievement in a year. Really, well done.

Becoming - not long for you to go from 4 avenues of debt to 3. You're doing really well.

I am trying to focus on how far things have come rather than how far things still need to go - to keep me motivated. Will be able to post figures when DDs come out for May.