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Building from the ground up

It feels good to be finally be building up as opposed to digging out of a hole.

I realised today that in the next couple of weeks, 6 November 2021, will be one year since I got back to work. At that point last year, I was about £14K in debt. My finances were a mess and I was still spending like I had nothing to lose. I had a budget but I was just telling it after the fact when I had spent money on things I couldn’t afford.

Fast forward one year and that debt is down to about £6K. I’ve been able to wipe about £1K a month off that debt since starting to earn a little bit more at the start of this year. For me this goes to show that focusing on increasing your earning potential is a much more powerful multiplier than focusing on reducing your spending and being more and more frugal. Of course you should do both but from my experience getting a lift in income does way more to improve your financial position than cutting costs on the same income. Combining both is definitely the winning strategy.

I finally feel I’m at the point where I’m starting to build from the ground up and see my financial situation improve. I’m currently at:

  • £15K cash assets in total
  • £6K debt remaining to be cleared (I’m trying to carry on wiping 1k off per month over the next six months as well as saving up for a house deposit at the same time)
  • £9K cash assets remaining if I cleared all the debt today (I’d rather not do that as it’s still interest free)

This is a much better position than I found myself a year ago. It’s still not amazing but it’s a start.

Reflecting back on the last 12 months, I think it’s fair to say the more I pay close attention to my money decisions and keep accountable to myself by writing it up in this space, the better choices I make. So, long may it continue and hopefully I can look back on this post in a few years time when I have £250K of assets and can be grateful for going on the journey to teach myself money and make smarter financial decisions.


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