I have somewhat of a rocky relationship with online shopping. What was once a healthy, buy-what-I-need relationship turned into me earning more, and therefore spending more.
Then, introduce credit cards. Woah boy, that soon turned from spending what I could afford to pay off every month into opening a second credit account with a larger credit limit to buy a new phone, and then opening a third credit account to use as emergency spending money for a trip to Amsterdam I had booked but didn’t save spends for.
The second credit account is at bursting point, I’m within my credit limit sure, but it’s close. My first one is almost an extension of my main bank account at this point and my third credit account I have a healthier relationship with.
I really want to get out of debt this decade, please. So, I’m re-evaluating my relationship with money and also my approach to online shopping.
Let’s snap those cards in half…
My physical credit cards are sat in a jar in my living room with a load of spare change. I can’t remember the pin numbers for the life of me, and it’s staying that way. So, the traditional method of cutting the cards into tiny pieces to prevent spending simply isn’t going to work here.
I’m taking a new approach. I’ve deleted my cards from PayPal. I’ve deleted any unnecessary banking apps (so I can’t see the numbers, and therefore won’t know how much there is available to spend). I’ve closed what I can where I can.
I’m going to go through my phone and uninstall all online shopping apps except those I really need. If I want to do any shopping, I’ve made it incredibly difficult for myself.
Shopping is going to become a case of “If it’s that important, I’ll get off my backside, wait for my laptop to turn on and do it that way”. Or, in the case of clothes/skincare/makeup shopping because I hate desktop sites with a passion, I have to physically walk into the shop.
My relationship with shopping, and with spending money is going to have to change if I want to get out of debt. And once I’m out of debt, I’ll be a whole £200ish richer every month due to not spending that on paying them off.
My debt repayment approach
Me being me, I’ve put together a group of spreadsheets to evaluate which way of paying off my credit cards would be most beneficial to me.
I’ve done the calculations, I’ve put visual graphics together (as reading numbers doesn’t work for my brain), and I’ve compared different techniques.
My two main competitors right now are the traditional same monthly repayment every month, or debt snowball.
This one is the easiest to understand. So, basically, you set a direct debit up to take out an amount you can afford that is above the minimum monthly repayment, and you pay that back until the credit has gone completely.
This takes the longest, but you do get to gradually see the increase in the spending money you have every month, once things get paid off.
You pay off your debts using the monthly repayment method, but as soon as one debt is paid off, that extra money is put towards paying off another debt quicker.
I like this method a lot as it means the debts get paid off sooner overall, but you are left with no additional spending money until all your debts are gone.
The next twelve months
The next twelve to thirteen months are going to be tighter than normal for myself, due to not letting myself access any “extra money” (that I don’t really have). This is for the best overall and I think I’ll begin to appreciate what I do have a lot more.
In addition to this, I know this is something I personally can afford to do as I’m lucky enough to be in a position of employment with regular pay increases, as well as being a part of the business profit share scheme and I have guaranteed employment for at least the next 4-5 years.
Getting out of debt is one of my larger 2020 goals and I am really working hard now to make it happen. I want a house, and I want to be able to afford nice things again without being in debt to get them.
It’s not even that I’m bad with managing money, I’m excellent at knowing what to separate for bills/spending. I just need to get on top of this before it gets on top of me.