Path to Freedom Blog

It has been over 5 months since my last blog post, and at that point, I had only made 3 posts in total. Now, that may seem like a major failure, but I am back, and that is a win that I will take.

Since my last personal finance post, I have made some significant changes, I have managed to consolidate all my credit cards onto the same personal loan that I had previously, I had to change my value of the loan, borrowing slightly more and extending the terms. I had 1 more recent credit card that I have transferred onto a 0% balance transfer card and still have my university £1500 interest free overdraft.

I now feel as though I have a clear line of sight. So long as I stick to the repayment schedule I currently have, then I will be debt free by September 2026.

However, just being debt free is not the goal. I have plans to travel this summer, and I intend to move abroad for a 10 month placement teaching English in Spain. Whilst this is a paid placement, it is part time and in Spain, so money will be tight.

For the first time in 2 years, I have savings of more than a few hundred £s. To be able to travel in the summer, I am expecting I will need at least £3000, to get settled and have a buffer until my first Spanish pay cheque I will need around £2000 and I would like to have a decent wedge of cash that I can fall back on, an emergency fund that can also act as longer term savings for when I return to the UK later in 2026.

I would also like to invest in my future. Soon I will be 28, and whilst I do not mind that I don’t yet own a house, I don’t want to be in a position where I am starting from zero when the time to buy / start planning to buy begins. As such, in the last few months I have been consistently contributing to my Lifetime ISA. By the summer, I am aiming to have £10,000 in here, at that point, I will be accruing £1 in interest per day, which serves as a nice bonus for whilst I am away, and will give me peace of mind that whilst I continue to pursue life and adventure ahead of stability, I have something for when it is needed.

I have recently gotten a part time job, I am yet to start working it, but I am excited to start earning an additional income that will be able to support my savings goals and debt repayments.

One thing that I will need to consider regarding my debt and the Spain move, is the repayment of my loan and the monthly repayment costs. When I initially got the loan, the monthly repayment was £250 per month. When I rearranged the loan to borrow more this then became £300. The loan works in a different way to most usual loans, and as such, every time I make an additional repayment, the length of the loan remains the same, but the monthly payment for the remainder of the term reduces very slightly.

The monthly payment is now £282 or there about thanks to having made a few overpayments here and there.

Whilst I am living on my Training bursary, student finance and my new part time job income this is completely reasonable to be paying each month. Come September, I will be expected to live on €800 per month and this loan amount would be close to 1/3 of my meagre income. As such, over the next 6 months I will need to make significant overpayments towards this debt to bring the monthly repayment amount down to a much more feasible number. I think if I can get it down to £100 per month I should be able to manage things. Using my rough calculations, I think I will need to be making a total repayment each month of close to £600 consistently to reduce the remaining repayment amounts.

At present my goals (in order of importance) are:

• £2,000 Saved for Spain
• £3,000 Saved for Travelling
• £5,000 Saved for the future
• My Monzo Loan overpaid until the monthly repayment amount is down to at least £100 per month (if not fully overpaid)
• £10,000 LISA Balanc
• My Overdraft and remaining Credit Card repaid