Dallas Paradigm

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Creating content focused on Personal Finance and Self-Development.

Accountant by day. Blogger by night. Fiercely Independent all of the time.

Financial Freedom

  • Is Freedom the Ultimate Thing?

    By

    Dallas Baker

    on

    Is Freedom the Ultimate Thing?

    If you could have anything, what thing would that be?

    Is it even a thing?

    Personally my ultimate thing is, Freedom.

    One Word Means Everything

    Freedom.

    Its just one word. Such a simple word. Hardly a word at all.

    But it means everything.

    That’s my thing. The one thing that I want. The one thing I am working towards.

    I strive and work towards freedom.

    Isn’t that ultimately what everybody wants?

    To be free? To have choice?

    What is Freedom?

    Freedom. The ability to make the decisions that have a direct impact on your own life.

    To live where I want.

    To eat what I want.

    To love whomever, I want to.

    To marry, or not.

    To have children, or not.

    To continue my education, or not.

    To work where I want. Or not to work.

    The choice to follow my own path, or even just to do the same as everyone else.

    Many Different Things

    That’s the thing with freedom. It can mean so many different things.

    Its not tangible. You can’t touch it.

    But you know when you have it.

    Taken in the context of personal finance and self-development, it’s the weight lifted off your shoulders when you are debt free.

    The relief when you end a bad relationship.

    The calm when you have an emergency fund, and the joy that comes when you are on the way to financial independence.

    When you have freedom you don’t realise its true value.

    Take Action

    You deserve to have freedom. Take a step today towards you very own financial freedom.

    Your future self will thank you.

  • My Student Loan Is Now Paid In Full

    By

    Dallas Baker

    on

    My Student Loan Is Now Paid In Full

    It took 22 years, 8 months and 27 days to pay off my student loan.

    Not quite the 84 years from the famous line in the Titanic movie, but sometimes it felt like it would take a lifetime.

    It feels a little strange for the day to finally be here when I no longer have any student loan left to pay. I had been paying it for so long. It was by far my oldest debt and now its finally and completely gone.

    I have finally, absolutely and unequivocally paid off my student loan. Hooray!!

    The Day Finally Arrived

    I had been imagining the day for so long. I wasn’t quite sure when it was going to happen, but as the balance crept lower and lower I knew that the day was soon approaching.

    I have paid off my student loan in full.

    That is such a sweet sentence. At times I thought it might never happen.

    It Took More Than 22 Years

    I received my first instalment from the Student Loans Company on the 1st of October 2001.

    My final repayment was made on the 27th June 2024.

    • It took 8,306 days.
    • That’s 22 years, 8 months and 27 days.

    At 42 years of age I was finally able to pay off a debt that I entered into when I didn’t really grasp the full weight of debt.

    For years the balance grew. It kept creeping upwards until I was finally able to pay off more than the interest charged during the same time period.

    That in itself was a significant turning point.

    As my salary grew more of my pay would be put to work towards the student loan repayment.

    Interest Charged Increases the Outstanding Balance on the Loan

    When I completed my course in 2006 my student loan debt was £25,298.75. In 2009 it reached a peak of £26,882.25, because I wasn’t earning enough for the repayments to be greater than the amount of interest being charged within the same time period.

    If I had never reached the repayment threshold, the student loan would continue to grow and grow, due to the amount of interest being applied to the debt. There was interest being applied to previously charged interest. The interest was compounding.

    Every month my student loan repayment would appear as a line item in the deductions area of my payslip. Every year I would grow disheartened seeing that the repayments made just the smallest of dents into the overall balance due.

    In April 2020 the outstanding balance was still over £20k. The realisation came that unless I threw every spare penny at it, I would have the debt for at least another 20 plus years.

    So that’s what I did. Everything and anything that could possibly go towards my student loan went towards it. Once April 2023 arrived the remaining outstanding balance was £7,408.43.

    The progress made during those three years was phenomenal, considering how hard it was to find “spare” money.

    Fast forward to 2024, a little more than a year later and the debt is now completely gone.

    If I Could do it all Again Would I Choose to Attend University?

    I value education, I really do. I love to learn. However if I could do it all again I would take the time to assess whether the course I chose was the best investment I could have made.

    There are cheaper ways of obtaining a degree. I made the best decision I could at the time with what I knew. If I were to do it all again I would consider whether I was going to get a reasonable return for the investment made, in both time and money.

    Twenty-two Years is too Long

    Given that it took me more than 22 years to repay my student loan, I expect there will be a rise in the number of parents with children attending university who themselves still have a student loan that they are repaying.

    It feels wrong. It is a disadvantage that will affect the generational wealth of a family.

    Parents who are still paying off their own student loan cannot help out as much with university finances for their children. As a result the child will likely go into additional debt.

    Whereas children from better off families tend to receive financial assistance from family members, they will not require the same level of student loan support. In turn if they do have a student loan it will be typically smaller and paid off earlier.

    When they themselves have university age children, they will be able to provide financial assistance and decrease the requirement for student loan support.

    The financially better off will continue to prosper, while the financially poor families get trapped into a continuous cycle of debt, as they try to better their generational financial situation through education.

    If I had not been able to make additional payments, I would still have a student loan. I would still have a student loan when my children reach university age.

    I am very glad that I have managed to pay it off in full. It was not easy and difficult choices were made to ensure that there was sufficient money to make the repayments.

    If my children decide to attend university I will now have the ability to offer support. If I had not paid off my loan in full I would be stuck still paying off my historic student loan.

    How Does it Feel to Pay Off Your Student Loan?

    As with most things the greatest joy comes from working towards the goal.

    Each month I was checking how much of the Student Loan was left to pay, I saw how each payment chipped away at the balance, during the additional payment months I felt exhilarated.

    During the months where there wasn’t any spare money to make an additional payment I would feel trapped and deflated. It was really tough. I felt stuck in place and as if there was no end in sight. Feeling that way would spur me on to put as much as I could into the repayment the next time I got paid.

    Visualising the Student Loan Being Paid Off in Full

    Along the repayment journey I visualised what it would be like to pay off the loan in full.

    I imagined having a payslip without a large deduction for student loan.

    Each month I put together a snapshot of my family’s financial position. I imagined how it would feel when I no longer needed to include a value for the student loan debt, in the monthly overall debt balance.

    I imagined how it would feel to have the money that usually goes towards student loan repayment, to go into my bank account instead. The feeling of hope. The imagining of what I could do with that money instead.

    How it would feel like a pay increase, because I no longer needed to pay off the debt. It was gone.

    How it would be extra money straight into my bank account as the money had already been taxed as part of my pay.

    Student Loan Repayment Milestones

    When I am paying off a huge debt such as a student loan, I find it helpful to break the task down into chunks. Smaller more manageable pieces. These are my Student Loan Repayment Milestones.

    Once you complete a milestone it is a great reason to celebrate.

    Celebrate and remember that you are making fantastic progress, remember that with consistency you will pay off the debt in full and have the freedom to do what you want with the money that was previously going to pay off the loan.

    Student Loan Repayment Milestones

    1. Your income has now reached the threshold where you are required to repay the student loan. Repayment thresholds vary depending on the type of plan that you are on.
    2. The outstanding loan balance starts to reduce due to the repayments. It can take some time to reach this point as interest is applied from the day you receive your first student loan instalment, and continues to be applied to the outstanding balance until paid in full. When the interest applied to the outstanding balance is less that the amount repaid during the period, you have reached this milestone.
    3. You have paid more than 10% of the largest outstanding balance.
    4. Half of the Student Loan has now been repaid. Your repayments will have more of an impact on the remaining balance due, as there is less outstanding balance to charge interest on.
    5. You reach the final 25% of the loan. You are getting closer to the endpoint.
    6. When you reach the point that your usual monthly payments will pay off the loan within the next 12 Months.
    7. Less than £1,000 left to pay.
    8. You make the final payment and see the nil balance outstanding on your student loan account.

    The milestones may occur in a different order depending on your starting balance and the level of your monthly repayments.

    The Final Payment

    When the time arrived for my final repayment, I called up the student loans company and made the final payment of £29.01. The advisor congratulated me and I was beaming with a smile. I finally did it.

    The following month when my next payslip arrived, my employer had received the notification to cease the deduction of student loan payments from my salary.

    It’s a good idea to switch to direct debit payments for the final year of repayments. That simplifies the repayment process and helps to avoid overpayment, and the need to request a refund from the Student Loans Company.

    If paying via salary deduction you can call up on your payday and make the final payment for any small amount remaining. The Student Loans Company will then issue a letter to HMRC to inform HMRC that student loan deductions are no longer required to be taken from payroll.

    HMRC then issues a letter to your employer and the employer ceases to take a deduction for student loan from your payslip.

    Even though we are in a digital age the communication to stop any further deductions is by letter. That means it can be slow and often missed.

    If you find that you are still having student loan deductions taken after you have completed your student loan repayment, contact the student loans company and they will reissue a letter to HMRC.

    Some Useful Contact Details

    To manage your student loan balance, first create an account with the Student Loans Company and log in here to manage your balance.

    Each month I logged in to the website to review and manage my balance.

    I checked my student loan account each month to see that the balance was reducing.

    At the end of each tax year I would compare the total value of student loan payments deducted from my salary with the amount on the student loan statement. I never had any discrepancies but given the large value it was important to check that all was correct.

    You can call the student Loans company on +44 300 100 0611 or you can write to the Student Loans Company at; Student Loans Company, 10 Clyde Place, Glasgow, G5 8DF

    If you would like to learn more about student loans and for more information on repayment, plan types and interest go to www.gov.uk/repaying-your-student-loan

    Free From the Weight of Student Debt

    I am very glad that I prioritised paying off my student loan. It feels wonderful to no longer have the weight of student debt on my shoulders. It is one more step towards becoming debt free and it feels GREAT!

    If you are considering taking out loans for education I encourage you to consider the return on investment. Are you likely to obtain an adequate return on the investment? Do you have to undertake the specific course at that specific institution.

    Select a course and an institution that will help you achieve your goals. You can even consider undertaking a remote degree or obtaining a degree part-time while working.

    If you have a Student Loan or any other type of debt, consider paying it off earlier than scheduled. Early repayment will save you money in interest charged, and will help you gain financial freedom sooner.

  • How to Get Started with The Starter Emergency Fund

    By

    Dallas Baker

    on

    How to Get Started with The Starter Emergency Fund

    What is an Emergency Fund?

    It’s important to be ready for unexpected events by having an emergency fund. This can be a savings account where you keep money only for big, unplanned expenses, like if your car breaks down or you lose your job. Think of it as a safety net that keeps you from falling into debt when something goes wrong.

    Accessibility

    Ideally the emergency fund should be easily accessible, so that you can use it during an emergency. You do not want to have to wait several days to be able to access the cash.

    A lot of advisors recommend three to six months of expenses to be saved in an emergency fund.

    Personally the £1,000 I have as an emergency fund, has had a huge positive impact on my family’s finances. It is usually enough to deal with the unexpected expenses that come up in life.

    For most of my adult life, I did not have an emergency fund, there was no spare cash. I was effectively living month to month, fully dependent on the salary from my employer. There was no room for error. I was stressed and incredibly worried about the fragile state of my family finances. It was intense fear and constant worry.

    What if? What if? What if?

    So much of my mental energy was spent on trying to think of how we would deal with the emergency at hand or the next one that was bound to come up.

    There was no room for anything to go wrong.

    Things always go wrong.

    These days I have an emergency fund. It started off very small. By small I mean tiny.

    Opening the Emergency Fund

    I opened my emergency fund with £1. Then each month I added some more money to it. I use a separate bank account, one that I only see by logging into my online bank account. In the UK its easy to open a bank account in a few clicks and without any account fees.

    Month by month I added to the fund. Fifty pounds, then more and more as time went by. I still had debt but understood the need to build some breathing space, so that I could plan for, and make calm decisions, should I need to use the fund.

    When I reached £1,000, I stopped adding any more money to the account. I then used any spare money on paying down debt.

    I keep the account at £1,000. This is the amount that works for me. Sometimes, the emergency fund is a revolving door. In one month and out the next. Sometimes I use it instead of a credit card. I then add money the next month.

    Breathing Space

    The point of the fund is that it provides the much-needed breathing space. I now have less financial stress. I have increased peace of mind. I can relax a little bit more that I used to.

    I am not awake at night, struggling to fall asleep due to the worry, about how I will ever manage the next financial emergency.

    All this from £1,000

    How Can I Save an Emergency Fund When I do not Have Enough Money to Live on?

    For a great many people the thought of an emergency fund seems out of reach and impossible. I can tell you that even £50 in those circumstances can make the biggest difference. Saving just £1 a week will get you more than £50 in a year.

    That £50 is the start of your journey to Financial Freedom. £50 can become £100 and can continue to grow and grow by putting in £1 a week.

    If you cannot even manage £1 a week do how ever little you can. Everything helps. Look carefully at where you are spending your money. Perhaps you will find some money, (however tiny) to start your emergency fund.

    How Does it Feel to Have an Emergency Fund?

    There is a sense of relief and security that comes from knowing you will be ok. If your job messes up payroll you have some money to cover the bills until you get paid. If you cannot work for a short period of time you can rely on that money.

    You do not have to worry about another unexpected cost that will throw off the family budget. You can say “Yes” to the school trip. You can take the time to decide where your money can go for the highest level of impact.

    When I first reached £1,000 in an online savings account the relief was immediate. It felt like a massive achievement. It was Huge. I had spare cash, just in case.

    And I used it.

    Using the Emergency Fund

    In the first few weeks of having an emergency fund I used it to cover a payroll error that meant I was paid a week late. If that had happened before. Even if it had happened just the month prior, I would have struggled. I would not have had the cash in my account to pay for the mortgage or a loan payment that was due on the same date.

    What it meant was I did not have to stress about being paid late.

    I was not losing sleep over it.

    I was not struggling to get a cash transfer from a credit card at a very high rate to cover the shortfall.

    It became a financial admin task rather than a life Emergency.

    You Can Have an Emergency Fund

    Don’t be put off when you hear about how an emergency fund should contain an amount that is huge compared to your current situation.

    Save what you can. Put aside the £20, £10, or even £5 and £1. Eventually it adds up. It makes a real difference. Having an emergency fund turns an emergency into a cash flow management task. It moves you from a point of desperation and panic, to a situation of being calm and taking control of your financial situation.

    That first £1,000 is a huge step towards a future of financial security and ultimately continuing onto the path of Financial Independence and real peace of mind.

    If you don’t have an emergency fund yet, it’s a smart idea to start one today. It might seem tough at first, especially if you’re not used to saving, but it will give you peace of mind and financial security in the long run.

    I challenge and encourage you to start your emergency fund today. Do not put it off. Your future self will thank you when you need it the most.

    It’s never too early (or too late) to take positive action for your financial future.

  • Just Start, add Content and Hope for the Best

    By

    Dallas Baker

    on

    Just Start, add Content and Hope for the Best

    “I am going to have a website and write a blog“

    Such a clear statement. Followed by doing absolutely nothing for at least a year.

    Well, I did do some things. I bought a domain. Or eight. I purchased hosting and a website theme and then it got hard. Then I “paused” which is another way of saying I stopped.

    What if what I write is stupid? What if someone I know reads it? What if nobody likes it? What if? What if? What if?

    So much to think about.

    Overcome With Fear

    During the year when I didn’t really produce any content. I was overcome with fear. I had to learn to embrace the fear. Eventually I came to the conclusion that it would affect me more if I never truly tried. I would always dwell on the “missed” opportunity.

    Now that I am really trying, I will know what could be, instead of only imagining it.

    Since I have decided to embrace the fear of failure, I am much happier for it.

    A World of Contradictions

    We are so full of contradictions. For example I love to be alone but thrive when I am surrounded with great people. I am nervous and shy but can act confident and funny. Sometimes it can be exhausting.

    I often need to be alone. I can find it difficult to function to a high standard when I am surrounded by too many people and their inevitable noise. At the same time I enjoy travelling and will often talk with a complete stranger, whether that be at the supermarket or on the train, anywhere really.

    I have many interests and what surprised me the most, was that I ended up working as an accountant. I have grit. I keep at it and find solutions to often complex problems.

    However, when it comes to trusting others to be open and welcoming, that I find the most difficult.

    So after at least a year without significant progress, I am getting this done.

    I am actually starting a real life blog.

    Here to Add Value

    I expect it will probably be pretty dire to begin with. But I am here. I have arrived and I mean to add value.

    Gone are the days of endless consumption, of taking and of not giving back. Here I am, adding content and hoping for the best. Hoping that my content will add value to your life.

    Don’t be too Hard on Yourself

    We can be very quick to judge ourselves harshly.

    We compare our starting point with the successful end point of others who are experts. That type of comparison is a no-win situation.

    So here I am.

    I will likely suck to begin with. I give myself permission to suck at this. Provided I learn from my mistakes. Life is full of learning and I learn best when I make mistakes.

    I expect to edit, delete and replace items as time goes by. That’s okay. Its great to be a work in progress.

    I mean aren’t we all a work in progress? After all this is our first time living this life.

    I don’t want to be the finished product yet. If I was, I wouldn’t have anything to aim for in terms of self-development to become a better version of myself.

    Just Start, and then Persevere Until You Reach Success

    I mean isn’t that what every successful student, entrepreneur and professional has done throughout their lives? I know I have. I didn’t get everything right all of the time when I was studying for my accounting exams and climbing the corporate ladder.

    How about we just get it done. Do it, and then repeat. Do it again and again and again. Then one day, take a look back and you will be astonished at just how far you have come.

    Here I am.

    Hello my name is Dallas and I am an Accountant by day. Blogger by night.

    Fiercely Independent woman, mother and wife all of the time.

    I am so very glad to meet you.