I’m still feeling under the weather, courtesy of my vaccination on Friday. I very rarely get ill, so I always feel as though I’ve been hit by a truck when it happens! Runny nose, aching muscles and joints, thick head and a general lack of drive to do anything. In short, not fun.

But, one advantage is I have not done all that much the last couple of days. I have spent most of today in fact thinking about what I am going to do when I am finally debt free in the next month or so.

A few years ago I would have splurged on all kinds of ‘toys’, new gadgets, a big expensive holiday and so forth. The last 10 months has disconnected me almost entirely from the consumerism that got me here in the first place.

So what will I do when I am debt free?

I will treat myself to Burger King

As silly as this sounds, I have not eaten out for myself at all this year. I have been frugal in my food shopping, dining and cooking experiences, and just once I would like to say “to hell with it” and go have some fun in a culinary sense. I can be fairly certain to walk away pretty full and not spend more than £10 for the privilege.

It’s hardly haute cuisine, but it has been something I have been dreaming about for the best part of a year and it will be a major expense for me: Ordinarily £10 will feed me for a week!

I will pad out my Emergency Fund

I have never had one, and I know I need one. Especially now that the Grim Reaper has been trying the doors at work. I think a reasonable starting point would be £1,000 – and work upwards towards 12 months of expenses from there. Currently my emergency fund is £70, and that is a bit of a cruel joke in every sense.

I will take my parents out to dinner

My mum and step-dad have been my rock so many times over the years, but they saved me this year. They put me up – at great inconvenience to themselves – rent free, to help me get out of the dark place that a falling-apart marriage creates. Living rent-free has enabled my “Get Out of Debt In A Year” goal to be a real possibility and not some pipe-dream. Thank you, guys.

It won’t be cheap. While my step-dad will eat just about anything (with the exception of carrots), Mum is allergic to a lot of foods. I need to do some research to find a good setting that can cater for this.

I will open my 2009/2010 Cash ISA

I’ve been singing the praises of ISA’s on this blog quite a lot. When I am out of debt, it’ll be time to heed my own advice and go and get one!

I will take a short frugal holiday

I need a holiday. I totted up that I have worked an entire extra month in just 9 months so far at work in my ‘debt payoff’ journey, and it has left me feeling old. A short holiday will be nice, just 4 or 5 days will be fine. Somewhere relaxing, somewhere I can just sit back and unwind. Somewhere I can soak up a bit of culture and a bit of alcohol. I will pay in cash, of course!

Should I expand this list somehow? Have I missed a blindingly obvious “when debt free” todo?

• Patience is a Virtue
• A Fundamental Question
• Notice of Disassociation
• Dig Yourself Out of Debt: Spend Less Than You Earn
• Dig Yourself Out of Debt: Psychology 101

At my place of employment yesterday, an email was sent round to everyone. It was from the head-honcho, the big cheese, the chief, warning everyone that we face a £35 million shortfall over the next 5 years and  spending, recruitment and employment would need to be cut as a result. Obviously non-pay budgets would be the first under review but “all options” remain open in terms of balancing the books.

It was a shock, but perhaps, not entirely unexpected. The entire world is feeling the pinch right now and the UK perhaps more than most given we’re the 4th 3rd most indebted country on the entire planet. Now, it’s extremely early days, and on the face of it I am in one of the more safer areas of our business. But that doesn’t mean I am taking my employment for granted and it doesn’t mean I am not at risk.

I have been given up to 5 years to plan for the worst. So what am I doing with that information?

I am doubling my efforts to repay my debts by the new year. If I (or you) are made redundant, then having debt hanging around will make life twice as hard. With no income, how will monthly commitments be met? Credit cards, store cards, loans, car payments and all other kinds of unsecured lending create a need to earn a minimum amount to meet these obligations month in, month out, before you even look at ‘living’. Reducing these to nil removes that worry entirely. Instead of needing to take home ‘at least’ £1,500 to live and meet your creditors demands, you could potentially look to take home just £500 by part-time means. This keeps your future employment window open far, far wider.

Take all the overtime that comes. Right now where I work overtime is everywhere you look. Courtesy of my debt freedom goal, I have been working overtime fairly regularly anyway and had planned to do so until December (my planned debt-freedom month). But now I will take every morsel that comes, and continue to take every morsel that comes until either the threat of redundancy goes away (perhaps in as much as 5 years time), or I am made redundant. Whichever occurs, I will be much better off financially for it. Realistically it’ll take a physical and emotional toll on me, but to know it means an enhanced degree of financial freedom makes that worthwhile.

Create and maintain an emergency fund. Various financial blogs extol the virtues of having a fund you can reach quickly, with a reasonable sum contained within it. For me, my emergency fund might look to be just £1,000 initially as right now, I don’t have one at all. Every piece of money I have is earmarked for a purpose. If my car blows up tomorrow, I need to have the ability to fix or replace it without opening a new debt. Emergency funds should not be tied up in ‘term’ accounts, it should be available immediately so don’t think of it as an investment product but more of a safety net. Don’t rely on your credit cards for your emergency fund either: If your emergency is redundancy, how do you propose to repay those cards after you use them? When able, an emergency fund should contain 6-10 months of what you’d need to sustain your household if money suddenly stopped coming in.

Put together a SCRAM file. In nuclear power stations, a SCRAM button is used to prevent a nuclear meltdown in the event that normal control of the reactor is lost. It pushes the control rods deep into the reactor, effectively stopping the reactor from working. The power station shuts down, and everyone lives to go home to their families. We all have a lot of things that come out of our bank accounts on a regular basis; Magazine subscriptions, mobile telephone contracts, entertainment packages (LoveFilm/Netflix for example) and other unnecessary expenditure. If you suddenly lose your job, you need to hit your own SCRAM button to stop these in their tracks or as quickly as possible. Put together a document that details what comes out, when, for how much, and who you need to contact or what you need to do to stop them. This one sheet of paper can very quickly cut your monthly outgoings to the absolute bear minimum with the option of picking them up again when your financial position improves.

Keep smiling. While it isn’t a pleasant prospect to have uncertain employment ahead of me for a while, I am in a better position that vast swathes of my colleagues. I do not have a mortgage (yet. One day.). My outgoings are cut back to their reasonable minimums already courtesy of my debt freedom goal. I will not have debt in a few months time and I am young enough but experienced enough to either be kept on, or hopefully find gainful employment not too long after disaster if it strikes.

The important thing is to plan. Without a plan, when your own recession bites, the entire situation will seem insurmountable when it doesn’t have to be that way.

Where to find extra help - the government as part of their eGovernment service provides a “Real Help Now” service packed with advice on the benefits and entitlements for those made redundant and the first steps you need to take. You can get started by clicking here.

How are you keeping your financial head? Share your plan in the comments.

• 5 Things I Will Do When Debt Free
• Weekly Roundup #3
• Dig Yourself Out of Debt: Avalanches and Snowflakes
• Catching A Perception Shift
• Investing Made Simple