The race to zero pt.3

I’m a couple of days late with this entry; forgive me. Things have been, interesting.

When I decided to create this debt reducing thread, I had a few ideas as to how I’d proceed.

My original plan was to work more and generate income, in effect creating a surplus to my monthly income. That surplus would then go to reducing my outstanding debt.

But I hit a snag. The overtime that was offered was snapped up like bread in a duck pond by keen eyed colleagues. I missed out on some great opportunities in January.

(My daughter is sitting on my shoulder and reading everything I type out loud. It’s annoying, bless her)

I also had a bout of the flu, which lasted around 3 weeks. It incapacitated me, showing another flaw in my plan.

But I have more plans – income generation.

Jumping about

Let’s back up a bit. January wasn’t all bad. I did manage to secure some overtime, some extra work delivering training, and offered my availability to do some shadowing/monitoring for some other stuff on the periphery of my day job. That was promising and it will show its rewards at the end of this month.

It also all materialised around the same time that I was starting to worry that nothing would turn up.

January is a long month

Historically it felt that way anyway. The issue of Christmas spending and a payday that can leave you budgeting for 6 oncoming weeks can make you feel the pinch, but last year I planned properly and all was well. January was just another month.

I guess sleeping through a third of it helped.

On the downside, the credit cards have remained static, rather than showing signs of reduction.

This might take longer than I thought.

Changing shape

I had meant to look at shifting regular payments onto my card, then paying more of my salary into them per month.

I haven’t yet. I will.

It might work.

Income generation

This isn’t a new thing. In a much earlier post I spoke of how some of the greatest financial whizzes out there talk of wealth creation methodologies.

Three income streams is the key. The theory being, if you lose one stream you still have money coming in.

In these days of redundancies and corporate collapse, we need all the security we can get.

Passive income seems to be the ideal. But does real passive income exist?

I’ve been working on a couple of digital sidelines and I can tell you, they take work! I’ve no doubt that once they’re up and running the time taken to tend them will fall away but for now, it’s work work work work work.

Investing

So here’s the key; the realisation that opportunities to work more in my current role are susceptible to my health and the speed of my response to an email has led me to the realisation that I need to invest more in my sidelines. This will mean investing in myself by getting some training/mentoring.

Gurus here I come.

BSD

January 2017

Card 1= 97.9% utilisation

Card 2 = 99.4% utilisation

Time to reflect.

It’s that time of year again where I like to take stock of the last 12 months. It’s a thing I do that allows me to press on into the oncoming new year with vigour and determination.

I try to weigh up the good and the bad in an attempt to learn the lessons that I was supposed to.

Sometimes I’m a slow learner.

The cub’s mum

We had more downs than ups. It’s still new and the wounds are still open I guess. This morning we managed to have a row after I asked how she was; the accusation? I phrased the question incorrectly.

I backed off. Part of my philosophy; it takes two to have an argument and I’m not playing.

stress

The lesson

This was one of a few flash points that we collectively experienced over the last year. So how do I avoid them in future, and why should I?

The easy answer is the stress that arguing brings. I just realised that my teeth were clenched whilst typing!

Some disagreement is inevitable, but it’s the handling of such that is all important; the reasons to avoid it are pretty obvious:

  • Poor health
  • Poor relationships
  • Unhappy cubs

The last one is crucially important.

I’ve spoken before about the fact that I will never speak ill of her in front of the cubs. It’s not fair; they only have one mum and they deserve to hold her in high esteem. I will do nothing to change that image.

This is where the teachings of the ‘7 Habits’ come in; seek to understand, before being understood.

In future, I’ll choose my words more carefully; consider my tone and watch my timing. Communication, not confrontation.

Failing that I’ll ignore her until the end of time, plus 15 minutes.

My home

I’ve mentioned already that I’m not overly happy where I am at the moment; it’s too far out for where I need to be, most of the time.

home

The lesson

Stop moaning! It’s warm, it’s dry, there’s food in the fridge. Some folk have none of those.

I’m sure that I will move in the not too distant future but for now, this is one blessing that I am counting.

Relationships

I’m single. I have been for a while now; the longest while in over two decades. For once, it actually feels ok.

love

The lesson

Historically, I used to bounce from relationship to relationship, without a break, without ever reflecting on why the last one didn’t work. Sometimes, perhaps inevitably, I’d go on to make the same mistakes again, and again.

I had to stop and ask myself why this was.

  • What was I compensating for?
  • what was I afraid of?
  • what was lacking in myself that I sought from a companion and could that ever be the successful driver of any relationship?

I know that I need to be the complete article before I can share that place in my heart.

I believe in the Law of Attraction; thoughts become things etc.

I also believe that the Universe will keep giving us the same lesson, until we learn it. I’m just thankful that the Universe is very patient.

I’m getting nearer to those answers by spending time with myself, discovering who I am, after all this time.

In the meantime, the most important relationship is the one I’m proudest of; the one with my cubs. They give the most amazing cuddles.

I’m sure that when the time is right, she’ll find me, or we’ll find each other. Then I’ll have to change my pen name.

Finances

Tough! as they no doubt are for us all. Everything seems to be going up apart from our wages.

green shoots

The lesson

Take control and keep control.

If you’ve read my last post on clearing my debt, you’ll know that I plan to smash this one in 2018.

My ultimate goal is to have 3 income streams. Something recommended by the successful out there. I’ll give you more on that one in 2018.

Health

I know the benefits of exercise, especially in the world we live in today. You absolutely have to do it. I use it to defuse stress too. See my first point, above.

why train

The lesson

Schedule my workouts!

I schedule everything else important, so why should this be any different?

I’m fit; I’m healthy and I’m thankful; truly, truly thankful.

More of the same next year and maybe something to aim for..?

So that’s about it for now. The planning is the next phase and the important thing is to set my goals early and write them down.

Commitment is everything!

XperiaZ3 762

So that’s it for now. Looking back, I’m pretty sure I know what I need to what I need to stop, what I need to start and what I need to keep doing in 2018.

Bring it on!

BSD

The race to zero pt.1

About this time of year I undertake a review of my personal finances. 

The reason I do this is two-fold;

  • I want to make sure that I’m in some sort of decent shape for Christmas and
  • I use this time to set financial goals for next year.

I go through everything, checking that I am on the best deals or using things in the best way; from energy bills to how I do the food shop, nothing goes unchecked.

This December, I’ve decided to take decisive action on my credit card debt and eradicate it over the next year.

My debt isn’t particularly high, but I’m in that daft cycle of paying just above the minimum each month, so effectively only paying the interest on a month by month basis.

This is great for them, not so great for me.

My target is to be down to 1/3 of the available balance on both of my cards by the 2018 review, with the real kicker being that I actually want to zero both cards by the summer, then use them as they should be used.

Ace

At the moment, I’m taking calculated risks with my credit cards. My balances are quite high on both but I’m hedging this against my ability to earn more money next year.

I’m not a spend less person but I am a spend wisely person, and that makes all the difference.

I’m also an earn more person and that is the key to this working.

What I intend to do differently over the coming year, is to journal my thoughts, actions and balances (in percentages) in order to either help and inspire others, or to reflect on good and bad practice. I’ll do this once a month.

I have a 3 point strategy

As usual, discipline (and delayed gratification) is the key.

  • Pay off as much as possible month-by-month, by *snowballing;
  • Reduce utilisation, as an extension of solid budgeting;
  • Increase utilisation, through regular payments.


In order for this to be a success, I have to understand my credit cards. The following is what I already know:

  • Which has the highest interest rate;
  • Which is more punitive on spending;
  • Which has the most perks or greater incentive for correct use.

I’ve mentioned correct use a couple of times. With cards, the idea is to keep your balance low then pay it off monthly. Sometimes easier said than done.

My issue came in that transition from two incomes to one; things needed to be bought and paid for. Items that shouldn’t be purchased on a card (when your utilisation of credit is quite high) started to creep on there regularly, rather than once in a blue moon.

As a consequence, I know have a robust set of rules around the use of credit. I’ll place these in the December update.


November 2017

Card 1 = 99.95% utilisation.

Card 2 = 97.22% utilisation.

green shoots

Time to get to work.

*snowballing – weighting your outgoings to pay off the debt with the highest interest first.

BSD

Holidays are coming…

And I’m talking finances.

For some reason, one of the obvious factors of becoming a single income household, the halving of the number of earners putting in to the family coffers, had not registered on my radar of anything, until that dip in income started to bite.

There is no pressure like financial pressure as it can feel like an ever descending spiral. This can lead to worry and depression which can itself lead to mood swings or some other harmful coping mechanism.

So the lead picture is Santa squaring up for a fight – you get the analogy; Christmas is coming and that can present a real financial squeeze, if you’re not prepared.

Speaking from experience, I’ve done the splurge for the festive season thing. It’s short term gain for long term pain. Historically, I would do this weird thing where I would pay most of my bills, before spending what I wanted to spend. This eventually led to problems, as you can imagine. When bills aren’t paid, companies (rightly) grow concerned and want what is owed them.

Then the letters start

Dealing with them is easier said than done and they are extremely easy to ignore. However, problems rarely go away if ignored so if you find yourself in this uncomfortable situation, give your creditors a call and explain your situation. It’s in all of your best interests to come to a solution.

This post isn’t about that; it’s about this

I want to talk to you about projecting forwards, as prevention is better than cure. I enlisted the help of a dear friend of mine,  Zane Groves, an entrepreneur who happens to be a bit of a financial whizz. Good job really as he’s a financial advisor.

He owned his own mortgage consultancy at age 26 but more impressively, manage to grow his business when large institutions were folding as the world experienced the deepest recession in living memory.

He’s a planner and he’s come up with a short and sharp, 6 point plan for a financially fit future. Over to him.

green shoots



1) What are your goals.

This may seem very obvious but have a plan. This can be from saving for a holiday to a deposit for your first home. Once you know what your goal is, plan how you’re going to get there and the sooner the better!

2) Make saving a habit.

We often say “I can’t afford to save” or I’ve only got £50 to save, what difference will that make. We let me tell you, you’ve been saving for that rainy day for 2 years and the boiler breaks, guess what you’ve got the money so you can pay for it immediately and not get into debt with your flexible friend. If you’re lucky enough not to need it then great!

3) Work pensions.

Pay! your employer does (UK law) and the younger you start the better. The average pension pot at retirement currently stands at £50,000 which isn’t going to go far. If you want a comfortable retirement save as much as you can afford. The same if you’re self-employed.

4) Protect your income.

In most cases spending 1% of your annual salary will protect the other 99%. Don’t rely on the state, incapacity benefit is currently around £88 per week, try living on that one.

5) Reduce your debt.

Where ever possible try and pay down your unsecured debt and focus on the higher interest rate charging vehicles.

6) Invest in yourself.

If finance really isn’t your bag, employ someone who’s it is. You wouldn’t after all get a baker to look after your car so find a suitably qualified financial advisor and let them work with you.

Money

 


He doesn’t mince his words. As a thank you to him I’ve included a link to his website througout the post.

I want to quickly dig a little deeper on some of his points, which if you look at them again, have one key personal factor involved; self-discipline.

The success depends on your ability to delay your gratification; want it now will lead you back down the rabbit hole.

Finally

My plan for Christmas this year is to splurge, in a controlled manner of course. I’m in a position where I can guarantee overtime for most of 2018. My plan is to put in some extra hours and ‘snowball’ my most expensive debt away. It’ll be tough, but it’s the trade off for running up the cards over 2017.

Please remember this; over the festive period your children ultimately want your time.

Looking back to my childhood, I can’t remember if I ever got that train set, or the Evil Kenevil Rocket Edition, but I can remember being loved, warm and safe.

I can remember spending time decorating the tree and I can remember falling asleep on the sofa, full of food and watching Christmas films. Relax and be happy!

tunnel light

BSD

If you are struggling with debt, please seek help; there are some great free resources available online.

If you’re in the market for financial products as well as good advice, please check out Mr Zane Grove’s website