An uplifting tale
MSE_Martin
MoneySaving Expert 8.3K Posts
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(Insert from martin: I found this an uplifting post from Stillworking. It formed part of the how much have you saved thread. So i thought i would give it one of its own.)
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Hi Martin
I am a subscriber to your newsletter and would like to thank you, firstly for making the world of finance less of a 'black art', and secondly, for helping people like myself find their feet after almost drowning in a sea of debt.
Why? Well...
I came out of university £18000 in debt (not unusual for a four year course in London) and managed to secure myself a relatively well paid job. I was, however, extremely poor at managing my money and thought of the 'available credit' on credit cards as my own money for spending. I rented a nice house, bought a nice car, had a nice holiday, bought some well-needed clothes and generally enjoyed life. At one point I even changed bank account (no more credit available from who I was with at the time) and fell for that awful 'consolidation loan' scam. At the time I could only see the reduced monthly repayments - what woe. I have since learned about net debt increase when you do this.
It came to a head one day when I found myself taking out cash on a credit card - tut tut I hear you say, but wait, it gets worse - to pay the bill for another credit card!! Thankfully I stopped myself and sought some help. I got in touch with the local Citizens Advice Bureau. That's where things started to get better. They contacted all the people I owed money to (and there were quite a few) and arranged for interest to be stopped on all outstanding money (at this point about £35000) while things were being resolved. They then detailed all my incomings (ok - just my salary) and outgoings (that took a while). After this they determined what money I had left over each month and divided it up between the creditors in proportion to the amount I owed. Without exception, my creditors accepted the new, revised, much lower repayments. I set up standing orders to each of them and honoured each payment as it became due. During this time I lived on £40 per week - hardship when compared to what I had spent in a week. Several defaults were placed on my credit record but no bankruptcy was declared, and no CCJ's either. Living on this amount of money was not easy for me as it meant careful budgeting, moving into cheaper rented property, no holidays, declining invitations to social events, shopping for only what I really needed, recycling things wherever possible, and shopping for own-brand groceries.
Four years later I was debt free!!! The feeling of looking at my payslip that month and realising it was all mine - well, you can imagine the emotions.
Since that time, I have really stayed on top of my money - as they say - once bitten, twice shy. I have saved into a 'cushion' account, saved into a 'holidays and presents' account and also saved into a 'deposit for house' account - each of which has been moved with your recommendations for best savings accounts. I have had no cause for going into debt, and have once again been able to enjoy my life to the full. The defaults have been cleared from my credit record too.
I then subscribed to your newsletter (a colleague put me on to it) and started to take some of your advice. As I'm sure you understand, I found it difficult to go for the 'Super Balance Transfer' tip, but have successfully taken the 'best cashback card tip' for use with business expenses (Accucard).
The reason I am posting this message today is because today is the day I have realised one of my dreams - I have taken possession of the keys to my new house.
Certainly, I will be keeping up to speed with the 'Best Buy Utilities', 'Best Buy Home Phone Providers', 'Best Buy House Insurance' and all the other fabulous tips you send through. Your advice will always be welcomed and I'll certainly make sure any children I may have in the future will be well versed in the merits of managing their money.
Thank You Martin
Please keep up the sterling work.
Sincere Regards
'StillWorking'
____________
Hi Martin
I am a subscriber to your newsletter and would like to thank you, firstly for making the world of finance less of a 'black art', and secondly, for helping people like myself find their feet after almost drowning in a sea of debt.
Why? Well...
I came out of university £18000 in debt (not unusual for a four year course in London) and managed to secure myself a relatively well paid job. I was, however, extremely poor at managing my money and thought of the 'available credit' on credit cards as my own money for spending. I rented a nice house, bought a nice car, had a nice holiday, bought some well-needed clothes and generally enjoyed life. At one point I even changed bank account (no more credit available from who I was with at the time) and fell for that awful 'consolidation loan' scam. At the time I could only see the reduced monthly repayments - what woe. I have since learned about net debt increase when you do this.
It came to a head one day when I found myself taking out cash on a credit card - tut tut I hear you say, but wait, it gets worse - to pay the bill for another credit card!! Thankfully I stopped myself and sought some help. I got in touch with the local Citizens Advice Bureau. That's where things started to get better. They contacted all the people I owed money to (and there were quite a few) and arranged for interest to be stopped on all outstanding money (at this point about £35000) while things were being resolved. They then detailed all my incomings (ok - just my salary) and outgoings (that took a while). After this they determined what money I had left over each month and divided it up between the creditors in proportion to the amount I owed. Without exception, my creditors accepted the new, revised, much lower repayments. I set up standing orders to each of them and honoured each payment as it became due. During this time I lived on £40 per week - hardship when compared to what I had spent in a week. Several defaults were placed on my credit record but no bankruptcy was declared, and no CCJ's either. Living on this amount of money was not easy for me as it meant careful budgeting, moving into cheaper rented property, no holidays, declining invitations to social events, shopping for only what I really needed, recycling things wherever possible, and shopping for own-brand groceries.
Four years later I was debt free!!! The feeling of looking at my payslip that month and realising it was all mine - well, you can imagine the emotions.
Since that time, I have really stayed on top of my money - as they say - once bitten, twice shy. I have saved into a 'cushion' account, saved into a 'holidays and presents' account and also saved into a 'deposit for house' account - each of which has been moved with your recommendations for best savings accounts. I have had no cause for going into debt, and have once again been able to enjoy my life to the full. The defaults have been cleared from my credit record too.
I then subscribed to your newsletter (a colleague put me on to it) and started to take some of your advice. As I'm sure you understand, I found it difficult to go for the 'Super Balance Transfer' tip, but have successfully taken the 'best cashback card tip' for use with business expenses (Accucard).
The reason I am posting this message today is because today is the day I have realised one of my dreams - I have taken possession of the keys to my new house.
Certainly, I will be keeping up to speed with the 'Best Buy Utilities', 'Best Buy Home Phone Providers', 'Best Buy House Insurance' and all the other fabulous tips you send through. Your advice will always be welcomed and I'll certainly make sure any children I may have in the future will be well versed in the merits of managing their money.
Thank You Martin
Please keep up the sterling work.
Sincere Regards
'StillWorking'
Martin Lewis, Money Saving Expert.
Please note, answers don't constitute financial advice, it is based on generalised journalistic research. Always ensure any decision is made with regards to your own individual circumstance.
Please note, answers don't constitute financial advice, it is based on generalised journalistic research. Always ensure any decision is made with regards to your own individual circumstance.
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Replies
It is nice to read a "success" story that you have been a part of so congratulations to you too Martin
You faced you're problems head on (with help of course
It can't have been easy in the last four years so I'll just say well done and hope you'll be happy, healthy, and contented in your new home.
It really was an uplifting tale. Thanks for letting us read it.
An inspiration - perhaps Martin should have you on the telly?
td x
Happy Christmas to you.Im sure it will be a good one.
I would be interested to know why people get into such dilemmas with debt. I'm sure there are various sociological and psycological reasons for it. I think it would make an interesting study.
I also begs the question - should we be teaching personal money management at schools? It would seem to me that at the moment we learn from our parents, learn from our mistakes, or never learn anything at all.
We, my wife and I, are on a seven-year plan with CCCS having recently changed from a commercial debt management company after hearing Martin on Radio 2's Jeremy Vine show. The simple action of swapping to the CCCS has shaved over two years off the length of our plan as the money we were paying the management company now goes to our creditors instead! Of course, that also means a financial saving of nearly eight grand over the term of the original plans 10 year period. Thats all thanks to Martin and his website, thank god there are people in this world like Martin Lewis.
After a life in merchant banking, you can believe that I have seen lending transactions that would mystify a child. Anyone can be a lender ....monkeys even !
The art of banking is to get back more than you lend.
There appear to be no more moral basics in lending today than there were in the 1960's. There are a lot more laws and regulations supposed to stop folk getting into the mess you found yourself but the situation only gets worse. The ease of court action via computer is now so smooth that few ordinary folk are able to respond fast enough to plead their case.
Watch the......