Leave the Debt in the Dust – My Plan of Action

Leave the Debt in the Dust – My Plan of Action

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June 2013 – The house move, The job search, The holiday and The car crash…

You don’t need to be an accountant to guess that this was a real expensive month. Upon finishing university we decided June was the best chance we’d get of booking a holiday before being tied to the routine of work. In hindsight, we could have been wiser with our money but even the most accurate of forecasts wouldn’t have saved me from a roundabout collision!

So How Much Did June 2013 Actually Cost?

By then end of June I had piled up £3400 worth of debt. £1800 borrowed from family to cover my losses plus I’d maxed out my overdraft at £1600. On the bright side I don’t consider myself to be ‘in the red‘, just a dark shade of orange. I’m in a very lucky position in that all of my debt is interest free! This gives me a great deal of flexibility in how I wish to pay it all off.

The Strategy and an October Update

I am looking to pay my family debt back in full before tackling the overdraft. It’s not great to look at a negative balance in my account, but I’m certain my family will need the money more than the bank does! Seeing such a negative bank balance is also a great driving force in trying to pay my debt off as quickly as possible. At current I am paying one third of my paycheck to debt (I can’t wait to be putting that much into savings instead!).

Just over three months have passed since expensive June so here are my debt repayments and current progress towards owning my own money! One of these repayments was thanks to an insurance payout for the crash but the majority has been earned from standard work and small side hustles:

Debt to Family Repayment Month
£1,800.00 £400.00 July
£1,400.00 £300.00 July
£1,100.00 £300.00 July
£800.00 £200.00 Aug
£600.00 £400.00 Sept
£200.00

Current Debt to Family: £200

Current Overdraft depth: £850

Total Debt as of today: £1050
If all goes well my family debt will be cleared by my next paycheck and the overdraft should be left in the dust by November. I am setting my expected date to be debt free as November 30th!

After paying off the debt I’d like to start some small scale investments in the stock market. I know I could have split my money investing some and paying back the debt with but I’d like to start my financial experiments only when I have a clean slate.

What do you think? Would you invest if you had a small amount of interest free debt to pay off?

Update: July 2015

Hi all! I’m checking back into thus post as it’s been almost two years since I cleared this debt for good! I now have multiple streams of income and Miss Breakaway and I are buying our first house! To find out more about how I got out of the rut, here’s my guide to getting out of debt.

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