So for the past 6 months i have been sort of coasting and my flat is still not ready to sell and my finances are worse than they were last year! So last night I started looking online for strategies to get myself sorted and stumbled on the following steps to getting healthy financially and these rules are:
Broke to Rich:
1. Save £1000 emergency fund
2. Pay off ALL Debts except Mortgage
3. Save 3-6 Months salary (FU Money)
4. Invest at least 15% of salary each Month
5. Save for College or in my case a deposit for when my son wants to buy a house!
6. Pay off House
7. Build Wealth and Give
So I am currently stuck in a cycle of trying to pay off my credit cards while having to use them whenever I run out of money which is less than ideal! So from today I am going to focus on working on Step1 and building a £1000 emergency fund ASAP.
This is not going to be helped by the fact I have to pay a £260 ebike service/repair bill and start paying my Motorbike off too BUT I still have about £4k in BMX bikes and bits to sell so that should help a fair bit!
I already have a savings account to send the Emergency fund to so all I need now is some money to put into it 🙂
My main focus this month is going to be getting the flat finished and on the market to sell ASAP and once that sells that will pretty much get me to step 4 in one go and I can then start investing most of the £2500 that I currently spend on the flat and its associated bills in getting ready for retirement and getting my pension pot over £100k ASAP so that it starts to earn more than I am paying in each month and start growing exponentially with little to no input from me.
This week I need to get all of my bikes cleaned photographed and on the internet for sale so that I can get some money back BUT more importantly free up some space at home that is taken up by bikes that I do not use 🙂
Once the flat is up for sale I can make a start on the garage and again sell everything that I can and also make a start on my Motorbike that has been left in the garage rotting for the past 5 years! I have everything needed to get it up and running and get it through an MOT and back on the road so all I need to do is get it sorted. Once it is back on the road I can either start riding it at weekends to do green lanes on OR sell it and get another £2500+ into getting my debts paid off.
Once the garage is sorted I can give that back too so that will save another £40+ a month on garage rental too.
This evening I am going to sit down and tally up everything that I owe and make a plan on how to start paying it off for step 2 using the snowball method so you pay off the minimum payment on all cards and then pay off the lowest one as quickly as possible then move on to the next lowest etc etc until all of the debts are paid off 🙂 I have had a quick count up and its looking like I am currently in about £30k of debt so not good 🙁
For July my goal is to get everything sorted and sold and start working on snowballing my debts starting with my PayPal Credit Card account which is my lowest debt at £3500. That and getting my £1000 emergency fund as well. I am hoping by selling all of my bikes this month I can get the £1000 emergency fund AND the Paypal Credit card almost paid off then I can make as start on my Barclaycard which is my next lowest debt at £4300. Hopefully by the time the Barclaycard is paid off the flat will be sold then I can pay off all my debts and jump from step 2 to step 4 and 5 🙂 Also step 6 will already be done so I can hopefully start to get into a great place Financially and start building towards retirement in 14 years time 🙂