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After a week of sharing my journey to becoming a debt free me, I’ve decided its time to step it up. Move faster if you will. Change up into 2nd gear.
In almost any situation it is actually possible to pull away in 2nd gear. 1st gear isn’t really designed to be a place you stay in for very long. It really should be seen as pulling away, helping you get started on your journey.
If I liken this to my journey out of debt, most people could probably trundle along quite nicely and never ever need to use 1st gear. But, it so obviously seems, I am not like most people. I have spent a long time in reverse. First gear has been a blessing in recent weeks however 2nd gear is calling!
I’ve started at the beginning this week and my first task was to get into my online banking.
Perhaps it wouldn’t have been such a challenge to get logged-in if I’d checked it more over the past few months and years. Eventually, I got in!
I’ve started with making a list of all of my outgoings and what I saw horrified me.
£1175 each and every month leave my account JUST PAYING BACK DEBT.
You did read that correctly.
£14000 per year JUST PAYING BACK DEBT.
And do you know what is worse? The fact that there is still approximately ten thousand pounds of ‘available credit’ that I could still use to plunge myself further and further into debt.
These are not ‘bad credit’ providers, there are no pay-day loans or loans from the daytime tv ads where Interest rates are in excess of 700% APR.
My debt is all from major high street lenders. Lenders, who up until now have lent me money, I’ve paid minimum payments and they’ve written to me to say congratulations, we’ve increased your credit limit.
For somebody who, in the past, has had a terrible credit score, this is some of the nicest affirmation you can possibly receive.
A letter from a major bank telling me that as my account is managed so well, they are going to trust me with more money. I must be doing well.
Luckily for me, I can now see the banks and credit card companies for what they really are.
Maybe on this journey I will discover fairer banks or lending companies that are out there – who knows!
Anyway, back to me getting into 2nd gear!
Yesterday, without distraction I made myself a very simple list on a scrap of paper.
In time I’ll probably put it into an excel document but right now all I have is 2 sheets of paper with lots of scribble on. At the top of the first sheet is my list and it looks a bit like this:
Next, I opened a new tab and cancelled what ever I could online.
I cancelled my gym membership. Can you believe, I visited 3 times in the last year! That means my that average visit has cost £83).
And that was it. That was all I could cancel online.
For all other items that I felt I could easily live without, I would need to pick up the phone to cancel them. This of course, was not a quick process. I’m sure if I’d called these companies enquiring about joining or signing up, my call would have been answered much faster! But hey, we’re sticking to positives!
So, a few hours later and I was feeling suitably chuffed.
I had a list of all of my outgoings
I had cancelled £95 per month of outgoings. This action alone will save me £1140 over the next 12 months)
I’d called back 4 companies who had been chasing me for relatively small ‘overdue payments’ and paid them and closed the accounts. 4 less phone calls to raise my blood pressure.
I’d spoken to one of my lenders and asked them to reduce my credit limit. Next, I asked them to set up a fixed monthly payment rather than have them take my minimum payment. (More on this later)
I’d signed up to Quidco. I knew that my broadband deal was coming to an end and the price was about to shoot up. Once I’d joined (the free account) I searched for broadband deals. I found that if I switched to a new one, my monthly payment would stay the same.
However, this is the good bit.
I earned £120 in cash back and earnt a gift card worth £120.
I also gained a free Alexa as a free gift and as I already have one of those it can go straight onto eBay. Earning me some extra cash too.
There were other providers that were cheaper still, but this overall worked out to be the best deal for me.
I also signed up to Top Cashback as well while I was at it.
Not a bad afternoons work and I will admit I felt pretty good.
My increased mood made me think about the day after.
One of the places I spend the most money is whilst I am at work on my lunch break.
I work right next to a retail park and this causes me big problems.
Every lunchtime I spend about £7-£8 on food. I then browse the shops and buy anything that takes my fancy.
On top of this, I visit Starbucks about 3 times a day adding another £15 or so to my daily spend.
Tomorrow is going to be different I said to myself. As a result, I made our evening meal and bulked it out with extra veg and added some kidney beans to my Bolognese.
I had loads left and so I took this for lunch and ate in the office canteen. Once I’d done this I didn’t have time to wander round the shops so went back to work early and was much more productive.
Why do I share all of this with you?
Maybe you’ve got this far and thought ‘yep, I do that’ and if you do THATS OK. The way we are bombarded with BUY ME messages and It’s only £xx per month.. messages means I can absolutely guarantee that
YOU ARE NOT ALONE.
But together, we can fix it. If you are prepared to really be honest and be prepared to make decisions that will feel totally out of your comfort zone to help you get out of it.
That’s what I’m doing. I know I am only a few days in to this, but already i’m starting to feel like I’ve got this. This time it’s going to work.
I really do feel like I’m now in 2nd gear. Don’t worry I won’t be speeding off any time soon. I have a feeling I’m going to be trundling around the back streets for quite a while happily in 2nd gear.
For the first time in a long while my engine (my head!) is not screeching whilst being revved so hard it’s impossible to think.
I do feel much calmer and feel that, for now, I am in the right gear for the speed I am travelling.
There’s so much more to do, so much more, and I hope you’ll join me as I share more detail on the steps I’m taking on the road to a debt free me.
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