It has been about two weeks since we have embarked on our ambitious plans to become completely debt-free in 10 years. I have been daunted (and haunted!) by this task and to be honest after crunching and re-crunching numbers am not convinced it is achievable just yet. That being said, we have had some successes in getting us closer to our goal and I am trying to focus on these rather than our debt mountain.
Financial successes this month:
- Student loan – This loan bugged me, so after some reader advice, I went straight to the internet and found a better deal. I was quickly approved for a £7,500 loan through M&S bank at 3% over 5 years. I estimate this will save me around £1,400 in interest plus the monthly payments have decreased by £26/month. 10 minutes of research for a £1,400 savings – I’ll take it!
- TV, Phone and Internet – Our monthly expenditure on TV, Phone and Internet was £102 per month, split as £44/month with Sky and £58/month with BT. After reviewing our bills I was convinced this could be improved, so Mr Small called Sky, threatened to leave, and they offered a combined package of TV, Phone and Internet for £55.20/month. That’s a savings of £46.80/month or £561.60 per year. I’ll take that! Note: I understand that Cable TV is a luxury and could be cancelled completely; however we enjoy watching family movies and TV shows and see it as a good alternative to going out and spending even more.
- Shopping deliveries – We were paying £9.99/month with Ocado on their Smart Pass. This allows us to get unlimited home shopping deliveries. I am looking at our grocery spending and considering changing stores so I called Ocado and asked to cancel the Smart Pass. Lo and behold, they then offered the same exact product for £2.99/month with the first 3 months free. I took the offer. I will now have 3 months to look at alternatives without paying a penny for deliveries. So the savings will be £9.99/month for 3 months and then £7/month thereafter if we stay with Ocado.
In summary, over the past 2 weeks we have saved £82.79 per month in regular outgoings. This is not life-changing savings by any means, but we can put that savings directly into our emergency fund. It also means that all our debt is at a 3% interest rate or less. After a useful reader comment, I have now decided to focus on our emergency fund rather than debt overpayments to try to build it to £10,000. We have 2 old cars and need both of them for work, so I want to make sure our emergency fund will at least cover the cost of 2 new (old) cars. A decent used car can be purchased for £5,000, a price which also falls comfortably within Financial Samurai’s one-tenth rule.
Note: I am not affiliated with any of the above products and do not endorse them in any way. The savings realized above are based on my personal circumstances only.