It has been a long time since I posted, and I apologise for that but life is rubbish and gets in the way.
Since August 2015 when the ex moved out I have struggled financially. I was used to splitting the bills and having money to spend every month so I started spending money. When he moved out I wasn’t used to not buying what I wanted when I wanted in and over the past 14 monthsy debt has spiralled.
I am quitting smoking so that I can save money (currently on day 8 of no cigarettes) and I am not having a social life so I can get the debt paid off ASAP.
The thing that has killed me is a high interest rate credit card, and when the card is maxed out they increase the credit limit. In 2.5 years I’ve gone from having a £250 credit limit to a £3,000 credit limit.
My debt currently stands at £6,536.96 Technically it is higher as I have a store card with £125 on it and an overdraft but the 6k is the main debt. It is broken down as follows:
- Loan- £1,536.96
- Credit card 1- £2,000
- Credit card 2- £3,000
The loan is a fixed monthly payment of £98.13 per month and I will have my final payment for that in April 2018 so that debt I’m not too worried about.
Credit card 1 is a low interest card, it is maxed out but payment is £50 per month which is slightly more than minimum.
Credit card 2 is the killer at a huge 39.9% APR variable interest rate. Bear in mind I pay £50 a month on a debt of £2,000, well with card 2 my minimum payment this month, on a debt twice the size, is a staggering £188.
I need to get this debt down, I can’t afford it. I pay it but then have very little money left for me after the bills have gone out, and what I do have goes on food.
So here is the plan….
- Cut up credit card 2
- Keep paying £188 per month until February
- Make monthly payments of £150 until paid off
I have direct debit set up to pay £150 per month unless that is less than the minimum, then the minimum payment is taken. I am hoping by February to have the minimum payment down to £150, then after that the £150 will be more than minimum.
I need to be frugel with money. Any excess money left over at the end of the month will go to pay off credit card 2.
If my calculations are correct I will have paid off my loan in April 2018, credit card 2 by October 2019 and theoretically credit card 1 buy October 2020.
Once the loan is paid off I will have it a bit easier on finances so I will easily be able to afford the credit card payments and not struggle so much with money. Once credit card 2 is paid off I’ll be having a party.
Wish me luck. I shall keep the blog updated as to progress