Update on my journey to being debt-free

Back in August, we committed to tackling our debts by:

• Budgeting
• Making overpayments on our debts rather than just making the minimum payments, so that we could pay off everything in a maximum of 36 months

As I said in my post “How on earth could we become debt-free?”, I worked out that we had €32,329.00 in consumer debt (credit card and loans). It seemed such a huge amount, but I’d read so many success stories of people paying back way more in just a few years. I knew we could become debt-free. So, how has it gone?

Well, it’s been hard. It’s Sod’s Law, isn’t it, that whenever you decide to do something, obstacles are thrown at you? And I can’t believe how many unexpected bills came our way. However, I view our plan as a work in progress, particularly the envelope system, and we just adjusted things and did our best.

We’re only on our third month following the plan, but we’ve stuck to the planned overpayments and any spare money that came in I put towards paying down the credit card. At the time of writing, our total debt is €28,466.05:

€3272.40 credit card debt

€13562.08 bank loan for business

€3290.57 personal bank loan

€5866 loan from family

€2475 loan from family

So, we’ve paid off €3,862.95 already. That feels really good. If we keep all the monthly payments the same, we’ll have paid off the final one in 33 months, but, of course, it will be less than that because as we pay things off we’ll “snowball”, i.e. add that monthly payment to the next debt.

It takes commitment, but I feel that the end is in sight.