I recently had a very nasty wake-up call when I realised that despite having a very healthy credit rating, I’d need to buy my new car on my credit card because I’d be risking rejection applying for any more credit. I have a crazy number of thousands of pounds of debt of which I am paying back more than the minimum each month and then creating approximately double that in extra debt…month on month. I’m not entirely sure at what point I decided this was ok but right now is the point that it must stop. It wouldn’t be so bad if I had loads to show for it but all I have is memories of cars that broke and cost me loads of money, a random collection of clothes and shoes and a few extra pounds on my hips where I’ve eaten too much junk.
I have precisely 5 months interest free to try and pay off as much of £3500 as I can before I am charged 27.9% APR for my cash withdrawal. Clearly I will do a balance transfer at the end of those 5 months if I haven’t paid it off, I’m actually pretty smart when it comes to money management. However, I’m not comfortable with how much debt I have and that’s the point when action must be taken. I could look at this as a major pain and get depressed about it because I will have to make sacrifices for the next few months but actually I’m quite excited about this challenge.
Never before have I set myself a proper challenge to live not just within my means but extremely frugally to pay off lots of debt. Now I don’t intend to stay in like a hermit every evening and never buy any clothes, I am a single lady with a life to lead but I will be taking opportunities to make changes which save me money. I’ve also added extra vigour to my working day to try and earn more commission in as short a space of time as possible. I’m going to be using my time and my money wisely.
Here are some of the immediate changes I have made:
- Budget – I have set up a spreadsheet which weighs up my income versus my essential outgoings. Now I can see what I really have to play with. It’s not pretty but I need to know it
- Magazine subscription – I am about 3 months behind on reading my magazines so I don’t need this. I have loads of books piled up for reading and the web provides me with a wealth of fashion based fun for free. It only saves me circa £18 per. quarter but you know what they say about watching the pennies!
- Food – Why do I think it’s ok to eat what I want, when I want? The fact is I eat far too much junk and it’s not helping my body or my bank balance. I will eat the food I buy and not deviate from that so much that I end up throwing food in the bin
- Shopping – I have loads of clothes and shoes, it is not essential to buy a whole new wardrobe every month. I will allow myself the odd treat but really I just need to stop being so greedy
Now I know those things sound obvious but I genuinely haven’t ever thought this way before and it’s going to be a challenge to stay focussed. I am still allowing myself some luxuries such as my Lovefilm subscription because actually that makes my nights in much more enjoyable. Having questioned myself spending £3,500 on a car, I realised that that was exactly what had led to my downfall before; skimping on the important things and spending on rubbish I don’t need. No more!
So this, the 1st Feb 2013 is the first day of me being a responsible adult (when it comes to money). You’ll be noticing a pattern in some of my upcoming posts about easy ways to make the best of what you have and save the pennies for the really special things worth spending money on. How are your bank balances looking, anyone got any amazing tips? x
As it so happened, my favourite blogger posted in a similar vein this week, check out her post too:
2 thoughts on “Where Did My Self Control Go?”
I think you’re lucky to be learning this very important lesson early on! So many people get stuck in a spending cycle and don’t realize until it’s years and years later and the only option out is bankruptcy. With the goals you’ve outline, I’m sure you’ll bounce back quickly! Thanks for giving my blog a shout out as well–I’m happy our writing was synched this week 🙂
A few years ago I worked for a couple of months in Muscat, Oman. It had been about 6 months since I finished Uni, and before I went I had paid off my student loan…so I was in super saver mode.
Everyday I would do, as you, a budget, never spend over it, save every penny I could…bargain for everything – and it worked!! I came back with over £2.4k in my pocket, and that was after paying for my flight home!
I once read an article, I couldn’t tell you the name or where, but it was on the habits of rich people. One of those habits was they nearly never spend more than their means. If they can’t afford it outright, they don’t buy.
I think its an excellent of managing your finances, I do it, my dad does it (neither of us are rich btw)…but it means that by not wasting money, when you want to spurge on something big, you can do and it doesn’t give you too much of a heart attack.
I believe you live down south somewhere, near London? Saving is more difficult here. Since moving to Chelsea I have spent waaaay too much 😦