31st July is almost here!

It's tax time again and I don't have the full amount to pay my tax off in one foul swoop. My plan to set aside so much per month to pay for my taxes as they become due has not worked as well as I'd planned. (You know the problem?)

At the start of the year my balance was £12,607.01 and if you look at my current balance, it would seem I am in the little hamster wheel. Running flat out and not getting anywhere.

I am not the only one who is in this place - I know, this is the slog, the tedious part of clearing debt.

I have made a list of my monthly debt balances for the last 7 1/2 years and have been using it to help me get a handle on where I am financially and where I have come from. It's a pretty scary list, as it shows how long I have been trying to clear my debt and instead, I have been slowly increasing it year on year.

Last year my lowest balance was £12,611.43 - having added my current tax bill to my debit balance for July I am still under this amount. July isn't over yet so my debt balance will go down further before the 31st of July. My tax bill will be paid in full by the end of August and the end of my current job also.

My lowest balance for 2006 was £7,644.42 and I would like my balance for the end of this year to be at the same level as that. That is my goal for the end of this year, I would like to have a debit balance below this figure.

That is now the plan - time will tell huh!

Days Are Numbered

Well, I knew it was coming, didn't know when but I now have an official end of employment day which is the 1st of September 2008. I was expecting it to be a lot earlier, like the end of the month and so am thrilled to get an extra month. Like I said back in April, changing jobs totally stuffs up my debt repayment plans (for the time being anyway).

I am still needed but only for three days a week, at half my regular wage which will not work unless I can get work for the rest of the week to make up the difference. But I would also need to get other accommodation, which would again reduce the amount I can currently pay onto my debts anyway. So it looks like I will have to get a new job elsewhere.

My goal to clear my loans by October is so close and I so want to reach it - it will mean my debts would under the 9K mark and back to the national average. Unless that has now gone up!
Currently I am still working on getting my debt under the 10K mark - if I can get a new job quickly in September I could still get there!

Still I have a month to sort it all out - thank goodness for that!

What's In Your Wallet?

Inspired by Debtkid who was himself inspired by a post on the Lending Club blog on cleaning out your wallet, I thought why not have a go myself.

Wallet Before Clean Out
Yep my wallet has been around the world and then some, so is looking very tired but I still like it. I brought it at Next a couple of years ago at a sale for only £5.

Empty wallet with all it's continence

The wallet continence was:

• two books of 1st class stamps
• a collection of foreign stamps brought on my travels (for when I go back)
• NZD$25.05
• GBP£2.05 (this is it till next Tuesday)
• two restaurant business cards from Italy and Turkey
• two keys (for my friends flat)
• NHS donor card (everyone should have one of these)*
• Boots advantage card (my favorite points card)
• Nectar card (not really using this one at present)
• Tesco Club card (not using this one either as there is no local store to my work/home)
• Orange Top up card (not using as I have now taken up a contract with Orange)
• Costa card (have about .90p still on the card)
• HSBC debit card (which is also my cheque guarantee card)
• Surrey Council library card (borrow don't buy books)
• receipts and cash machine slips

The Orange top up card, two restaurant business and the receipts etc. have all got to go as they are just taking up space. But everything else can stay, no credit cards as you can see and no overdraft on my debit card either, so no available credit to waste.

*Do you have a donor card? Have you thought of becoming a donor but have just been putting it off? Why don't you sort it out now online and contact www.uktransplant.org.uk or contact an organ donor register where you live. Help someone else to live after your death - you can't take it with you.

July Review

I get paid weekly - so every week when my pay goes into my account I get busy transferring monies around my various bank accounts. It's the fun part of my finances as I get to see my debt go down and my credit go slowly up, even if only by little amounts.

At the end of this month I will be back to where I was at the start of May (or should I re word that to "before my trip to Turkey"). In April my final balance for the month was £10,979.40 and I am hoping to get my balance this month down to £10,980.00.

Next month the goal is to get my final balance below £10,000.00, which will be the first time since 2006 it has been that low. Back in March I was fretting about not being able to get below £12k now I just want to get under the £10k mark. Time will tell don't you think!

The Debt is still with me!

My tan is fading and it now seems like forever since my summer holiday trip to Turkey (and there abouts) last May.

But my debt from the trip is still with me and my debt total is back where it was at the beginning of April.

Still it was a great trip!

You can't spend what you don't have!

Since getting rid of my debit cards overdraft I have really had to think about what I am spending money on and if I can get it cheaper somewhere else. The habit of frivolously spending £5 here and £10 there has to go and so is the shouting my friends a coffee or a meal. I am having to go dutch now when I go out with my friends. It's kind of sad to have to do that but I need my weekly spending allowance to stretch as much as possible.
Last weekend I was in the local town (local to where I work that is) and I stepped into WH Smith with the idea of getting a paperback or two, as they were having a sale. Before I had really even looked to see what they had I remembered that my debit card was very low, so had to dash to the hole-in-wall to check my balance. Not enough funds to get a book or anything else, so had to go home empty handed. Not such a nice feeling!!
So much of my wage is going on what I have already brought i.e. my debt, I don't know why I even bother to go to the shops at all.
At least now when I use my debit card I know that I am not creating any more debt for myself and that is a good feeling. It's the restriction of living on a tight budget that is so hard to deal with but I do know that it is all for my own good and I need to learn good habits about spending.

Credit Cards - Chopped Or Iced?

Had to make a call regarding one of my credit cards today as two strange transactions had appeared on my pending statement. They were only for smallish amounts of £8 and £15 but as I haven't used the card since I got back from Turkey and I have never been to Luton, I decide to find out.
I have never had to do this before and am now waiting for some forms to come in the post to apply for a refund on the transactions. As an extra precaution I have also stopped the account and will be sent a new card in the post which I shall cut up on it's arrival. Can't they just let us have the option of having a new card sent or not, as we choose. I guess they'd rather we had the card and fall into temptation. I was bad I know, as the only reason I had the card was because the old one had expired so they sent me a new one and I didn't get rid of it when it arrived. I favour the "chop it up" approach but some like the "freeze it in a block of ice" approach.
What do you do? What's your approach to the little piece of plastic?

To Consolidate Or Not To Consolidate

Maybe it's the time of year or may be it is something in the water but I have been tempted to consolidate my debts and have only "one easy monthly payment". It does sound good doesn't! You have a set monthly payment which makes your budgeting easy and month by month your balance goes down as you clear your debt.
Ahhh - sounds wonderful but there is a little problem, for me at least there is, maybe there is for you too and that is I have been a bit of a serial consolidator. I have consolidated my debt in October 2001, September 2003, March 2005 and September 2006. Can you see a patten emerging here?
You would think I would have learned by now but wave a low interest rate in my face and I'm filling out the forms like there is no tomorrow. And that is just what happened last week and you are probably thinking "well, if the rate is lower than what your currently paying that is a good thing". You'd think but when I entered all my information to the online forms, my reply was to say that I did qualify for a loan and should call the number on the screen to get more information.
The wording should have told me it all but no! I called the number and found that the great rate had increased by 4.2%, not so great a loan now but did I say no? Well after some umming and arring on the phone I agreed to the loan at the increased interest rate. I knew that I had a seven day grace period should I decide to cancel it - good thing too.
I spend a day going over the number and it just wasn't worth taking up the loan and so I have cancelled it.
Really a no brainer as I would once again break my third rule of "not increasing my debt" as the interest is all added up front. Also I would have been tired into a two year payment plan and be paying more interest in the long run. I, of cause rejected the PPI offered and wasn't impressed by the method that was used to try and get me to sign up i.e. If you lost your job how would you pay for the loan? (Get another job??)
In September I pay off the consolidation loan I took out in 2006 and I know that like my debit card overdraft, re consolidating my debts just gets me into more debt.

Rule Number Three

Okay here are the new figures for my end of month for May and they aren't good reading:

Flexiloan £1,844.00 up from £492.25 at the beginning for May

Bank Loan £1,535.32 down from £1919.15 at the start of month

Mastercard #1 £4,359.00 up from £3,300.00 at the start of month
Mastercard #2 £3,792.00 down from £3,842.03 at start of month
Creditcard #3 £1,094.00 down from £1,139.88 at start of month
Current Account in Credit (with one pending change of £12.00)

So the outcome is that I am now back to my January balance at £12,625.00 and I have increased my debit by £1,645.00. By doing this I also break my rule number 3 of "not increasing my debt".

It is all a matter of getting back on track and get the balance down again, with the knowledge that it is going to take an extra two months to clear my loans, so in turn my DFD will have to be adjusted accordingly. But am I really sorry about all this? Not really, as I had a great holiday and so did all my friends and I can account for most of the monies spent.

Was I right or wrong?

Wow One Year On!

I can't believe it has been almost a year since I started my pf blogging. Time really flies!
It was last June when, while reading the DWD board on the Motley Fools site, that I discovered pf blogging. My debt had just hit £20k, which was quite sickening and I was trying to get my finances sorted (for about the 10th time).
Well a year on and how well have I done?
This is a very scary question as I have just returned from a two week holiday in Turkey, a holiday in which I not only went over budget but blew it out of the water! I really don't even want to look at the figures for the time being but it was a great holiday!
Icmeler rocks!
The worst part of blowing my budget is the holiday was free (eg. flights, transfers, accommodation). Oh well got to get back to the grind, back to reality. I have got to get below the £10k mark! That is my next goal.
(I will do the figures - eventually)