Debt. If only I knew then, what I know now!

Lizzie75 · 6 September 2008 at 5:43PM

I've just found this forum and thought I'd tell my debt story/journey.

I'm 33 and about 14 months ago, was £37,000 in debt (yes, I know, don't keel over...though I did when I finally totted up all my wicked spending ways!).

With a salary of just short of £30k coming in, I knew I was heading for an even bigger mess if I didn't sort myself out. Thing is, I was getting in deeper and deeper all the time....and there was nothing left over for emergencies.

It finally all came to a head when an interest free period came to an end on my credit card which had a balance of £8000 on it. Stupidly, I was only paying off the minimum payment (MBNA, bless their hearts were only asking for a fiver a month, during the interest free period) and because I was away with work a lot, I'd forgotten to swop.

I applied for another card...and all of a sudden no one would give me one and I was now saddled with an extra £200 a month debt, which I couldn't meet. In other words, time to finally deal with the problem, instead of vaguely hoping I might one day win the lottery.

Thankfully I have a great family, and although they knew I was in debt, didn't know how much, so we had a bit of a crisis meeting, where I took all my paperwork and worked out how bad things were. I cried so much, I was hiccupping...but as they say confession is good for soul. My mum is a whizz with budgeting and although horrified, she helped me work out how much was left over. I opened up a 'spends' account, seperate from my bills account and each month, started putting £300 in there, which was my living money, for petrol and food. Once that was gone, there was no more....no more credit cards...and they even made sure that my bank statements went to their address, to help keep me accountable. What a horrendous, painful experience, but I knew the only way was to get an IVA or go bust and I couldn't bear the thought of that.

So, 14 months on, things are looking a bit brighter. I have paid off £12k of debt in that time and am just waiting for this month's pay, so I can see my debt finally tummble into the £24k mark! Amazing how a person can actually be 'glad' to be 24k in debt!

I tell the story because a) it's not yet over and there's a long way to go, but b) to kinda hopefully give anyone else a boost who's facing a financial nightmare. The point is that with some determination and rigid budgeting, it is possible to fight your way out of a big black hole. This site and Motlety Fool have been really helpful....and it's amazing how my thinking has changed. I used to never look at prices in the supermarket, nor tot up my three-times-weekly trips to the cashpoint....or think twice about spending £100 on a whim. Now I can't do such things...but I value every fiver extra that I have. I have a piggy bank and whenever I have spare silver, in it goes (I try to forget about it and then surprise myself to discover I have £20 more one week than I thought I did). I drive less, I shop at Aldi and I no longer spend £5 on a bottle of shampoo. It's nowhere near as much fun, but actually, life feels more in control. Course, this credit crunch business is quite frightening....but I think you kinda just have to keep your head down, do your bit and brace yourself till the storm is over.

But...my goodness...if only I'd known in my 20s, what I now know in my 30s...how easier life would be now! But hey ho! Live and learn.

Good luck peeps....feel free to post your own debt stories here too!