We went from being bad with money and £6k in debt to buying £255,000 first home | The Sun
JUST five years ago, Tara and Jonathan Bullock were £6,000 in debt and owning a home seemed an impossible challenge.
But by overhauling their finances and radically changing their spending habits meant the couple went from being bad with money to being first time buyers.
Tara, 27, who works for a fire sprinkler company, and Jonathan, 30, a plant machine fitter, had racked up thousands of pounds of debt.
They did this by racking up credit cards bills of around £500 by spending "unnecessary" amount of money on clothes and takeaways.
But in 2018, they decided to clean up their finances and tackle their debt.
The pair consolidated their debt using a 0% balance transfer credit card.
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You can move the balance from other cards onto a new one, and typically you pay no interest for a set period.
They are a great idea if you have debt spread across a few different cards, or if your interest is high.
This means the debt is easier to manage because it's all in one place and you can focus on repaying the debt, rather than the amount of added interest.
At the beginning of 2020, the couple had managed to clear all their debt and were able to focus on saving for a deposit.
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Tara, 27, and Jonathan, 30, saved for years to afford their new home, and made some sacrifices along the way as well.
They stopped going on holiday because of the pandemic – which saved them £3,000 in total.
The pair also used to love meals out too – but after realising this was costing them around £100 each time, they decided to stop dining out.
The couple bought their two-bedroom flat in Bracknell, Berkshire in January this year and moved in a few weeks later.
The Sun sat down with tara to see how she and Johnathan kept their savings on track for our My First Home series.
Tell me about your home
It's a two-bedroom ground-floor flat in Bracknell, Berkshire.
We have a separate living room and kitchen and one big bathroom.
We have big patio doors that lead out onto a balcony, which we hope to spend a lot of time on in the summer.
There's also a communal garden that we share with other people in the building.
How did you decide on location?
We knew that we didn't want to move far away from family, so we looked for properties nearby.
It was important to us that we didn't move too far away from my parents, who we had been living with while we saved.
We now live just a stone's throw away from my parents.
The area has really good transport links and access to the motorway which is great for work.
How much was it?
The flat cost £255,000 and we put down a 10% deposit of £25,000.
We took out a mortgage of £230,000 for 35 years with a fixed rate of 4.17% for five years.
We decided not to use any government scheme's like Help to Buy because we didn't want to limit ourselves to only looking at new build homes, which are often more expensive.
How did you save for it?
Jonathan and I were living with my parents before we decided to move out, which saved us a lot of money.
This really suited our lifestyle because it meant we could focus all of our efforts on saving.
We had been paying around £200 in rent to my parents, but they kindly stopped making us pay this at the start of the pandemic so we could focus on saving.
In 2018, Jonathan and I had around £6,000 worth of debt between us which had built up over around five years.
We had been racking up big bills on our credit cards, by being bad with money and spending unnecessarily on clothes and takeaways.
It got to a point where we faced up the situation and began to seriously start paying it off.
We also decided to consolidate our debt on a 0% balance transfer credit card.
How to cut the cost of your debt
IF you’re in large amounts of debt it can be really worrying.
Here are some tips from Citizens Advice on how you can take action:
Check your bank balance on a regular basis – Knowing your spending patterns is the first step to managing your money.
Work out your budget – By writing down your income and taking away your essential bills such as food and transport. If you have money left over, plan in advance what else you’ll spend or save. If you don’t, look at ways to cut your costs.
Pay off more than the minimum – If you’ve got credit card debts aim to pay off more than the minimum amount on your credit card each month to bring down your bill quicker.
Pay your most expensive credit card sooner – If you have more than one credit card and can’t pay them off in full each month, prioritise the most expensive card (the one with the highest interest rate).
Prioritise your debts – If you’ve got several debts and you can’t afford to pay them all it’s important to prioritise them. Your rent, mortgage, council tax and energy bills should be paid first because the consequences can be more serious if you don't pay.
Get a payment holiday – Credit card companies and mortgage lenders are offering three-month payment holidays until the end of March 2021 if you're struggling to meet your repayments. You should always keep paying until you've come to an agreement with your provider. Most lenders will also still charge interest during this time, so be aware that these costs will keep building up.
Get advice – If you’re struggling to pay your debts month after month it’s important you get advice as soon as possible, before they build up even further.
Speak to:
- National Debtline – 0808 808 4000
- Step Change – 0800 138 1111
- Citizens Advice – 0808 800 9060
With this, we transferred our balances from existing credit cards onto one.
We didn't have to pay interest on it for around 18 months, in which time we managed to clear the debt.
Living with my parents meant that we had very little outgoings so we were were very strict with our spending.
Over this time, we didn't go on holiday at all.
Before, we would spend around £1,500 going on holiday.
This meant we saved around £3,000 in total over two years.
Jonathan and I also used to love meals out and would spend around £100 every two weeks treating ourselves.
We stopped doing this and managed to save a small fortune.
In 2020 – just before the start of the pandemic – we had managed to clear all of our debt.
Because we had been used to having little spare cash while we were paying off our debt, we were able to save quite a lot quite quickly and we carried on with the same habits.
We still didn't go on holiday and continued to not eat out.
We were both putting away £1,000 a month into savings – around three-quarters of our wages.
While this was a significant chunk of our earnings, it was relatively easy because we weren't paying rent and there wasn't much to do because of pandemic restrictions.
The only out goings we had were our phone contracts and car insurance, which came to around £400 between us.
But we did treat ourselves to around one takeaway a week – spending around £50 on this.
I also used my Monzo banking app to round-up my purchases to the nearest pound and the savings would go into a savings pot.
I then used the money saved in this pot to pay for Christmas, which was around £250.
It was great because it meant I had the money set aside and I didn't even notice the extra pennies leaving my account.
Jonathan also made some extra cash by selling two of his cars, making an extra £2,000.
Were there any complications?
Luckily, my credit score didn't take too much of a hit despite my debt.
But Jonathan did have to work to build his back up again so that we were in a good position to be approved for a mortgage.
He downloaded the Clearscore app, which checks your credit file for free and tells you what steps to take to improve your score.
Jonathan took out a credit card – spending just a little each month and paying it off in full.
Doing this meant that when the time came to buy, he had a good credit rating again.
How did you afford to furnish it?
We saved an extra £2,000 on top of our deposit afford to furnish our home.
We bought everything in stages so that we didn't have to fork out a lot of money all at once.
We got into a habit of buying one thing we needed each time we went shopping.
So one week, we would buy a whisk, for example, and the next week we would buy a set of baking trays.
We also asked for gift vouchers for birthdays and Christmas, for places like Argos and Ikea, so we could buy furniture.
Do you have any advice for other first time buyers?
Just save as hard as you possibly can and save more than you think you'll need.
It's easy to get caught out by extra costs, like solicitors fees, so just make sure you're covered.
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