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Clearing over 100K of debt

hamilton20
Posts: 13 Forumite


I have lurked on these boards for several years now and have been inspired by many people's stories which have really helped me in my debt free journey and am very grateful that this forum exists at all.
My original debts, created by my own stupidity, with no, in my case, responsibility falling on the credit card or loan companies (I am at least bright enough to understand the concepts of accruing interest, late payment charges etc. and can read) consisted of the following:
60,000 on personal credit cards and loans
27,000 to the Inland Revenue for several tax years when I was self employed and had just spent the tax...
20,000 on my mother's credit cards when she was trying to help me not lose my house, she has never had "cash" to lend/give me.
5,000 from a friend
So around £112,000 in total at the beginning and I had no savings, but around £25,000 equity in my house (so £87,000 of debt and nothing in the bank!).
I have been paying this off for around 7 years now with a DMP with CCCS and have cleared around £92,000 which includes £25,000 from the sale of my house which I eventually had to do to pay the Inland revenue, but I am confident I will own again. So I now have around £20,000 debt which should get paid within the next two or three years.
My income is pretty good, not massive, about £40,000 now but was about £25,000 when I started paying my debts.
I have learnt many money saving tricks on the way including rarely switching on my heating and hot water. I have a very efficient cheap to run oil radiator which I keep in my lounge and deliberately rent a first floor flat now which is sandwiched between people downstairs and upstairs so I "share" their heat. I only take showers and I fill my washing up bowl from the shower. In the winter in the evenings I wear pyjamas and a onesie and a very thick warm towelling robe which my mother bought me one birthday. I also wear a hat if its very cold so I do tend to look fairly ridiculous and about 20 stone because of all my layers, so would not recommend this look in company
Consequently my average fuel bill is £7 per month on gas (mostly standing charge) and £20 on electricity. I am on a prepayment electricity thingy and I analyse my spending on it religiously.
I am a single parent with one daughter who is now at university but who was about 12 or 13 when I started this journey. She has always led a full life and did many things when not at school which I managed to keep paying for while I was paying my debt e.g singing and flute to grade 8, rides a horse well and has always participated in drama groups. And she always had plenty to eat, and plenty of love, of course.
I think a lot of people worry about the effect paying debts may have on their children but I feel she has actually benefitted in ways from what I am going through as she decided to work 30 hours + per week in a supermarket to pay for herself going through university so she that she has no loans/debts after seeing what has happened to me, and her academic performance does not seem to have suffered from working as she has recently been told that the university intend to give her a full scholarship to do her MA, this is based on her academic performance up to now, not on her financial situation. Her intention is to be a lecturer. She has for the last few years refused to take any money from me, even a small amount of say £5 as she wants to "do it on her own". She also worked through doing her AS and A levels but gained all A grades in them and a distinction in a further paper she took. (Mind you, three months before each round of exams that she had I would pack away the TV and monitor her computer usage and she would grumble no end for a couple of days and then she was fine). After she finished her exams she could watch TV and stay on the computer all night if she wanted, I didn't care! And now, she's not that bothered about TV watching. It also saved me electricity money hee hee! She has also since thanked me for doing this although it was hard doing it at the time, I felt a bit sorry for her
But you'd be amazed how much time you have if you pack away the TV!
Out of absolute sheer desperation to find more money, I started an ebay business which now gives me an extra £1000 in my hand income per month and I hope will continue to grow. Two years ago I was making nothing on ebay. This took me several years and many hours of research to find reliable suppliers that I could buy at a price to undercut everyone else on ebay and learning ways to comply with the strict ebay rules so they didn't shut me down like they do to a lot of sellers. But I was not going out much because I couldn't afford it so I had plenty of time to do this. (This time I have put away my tax so I don't spend it!).
I have never had any financial help from anyone else, family or friends, to pay this back. I had a small amount per month in child support from my daughter's father awarded by the CSA until my daughter was 16. My father passed away in 1993 and I have no brothers or sisters.
Reading this back it may come across to some people as "haven't I done well" but this is not my intention, indeed I never ever intended to post on here as for years as I was so ashamed of myself, but I read a lot of stories on here about people who think they can't cope, effect on their children etc, but I just wanted to tell them it doesn't have to turn out bad. That is my only reason for posting this.
At times I have felt lonely and desperate, particularly at the beginning when I admitted the extent of my debts, but I never would have considered bankruptcy, as I feel I made my bed, I lie in it. I am not saying however that bankruptcy would not be the right thing for others as everyone's situation is different.
I have witnessed to a small extent the trauma that can happen to a family when someone takes their own life through debt as my cousin's husband did when he jumped off a bridge. This should never happen. Its only money. The fact is, they can't take off you what you haven't got. No-one would let you starve or end up on the streets, nor your children. Without the least intention of sounding blase, perhaps you may go without a few things for a while and you may lose your house as I did but hey, so what, I'm still here and the sun is shining outside and I feel happy!
My original debts, created by my own stupidity, with no, in my case, responsibility falling on the credit card or loan companies (I am at least bright enough to understand the concepts of accruing interest, late payment charges etc. and can read) consisted of the following:
60,000 on personal credit cards and loans
27,000 to the Inland Revenue for several tax years when I was self employed and had just spent the tax...
20,000 on my mother's credit cards when she was trying to help me not lose my house, she has never had "cash" to lend/give me.
5,000 from a friend
So around £112,000 in total at the beginning and I had no savings, but around £25,000 equity in my house (so £87,000 of debt and nothing in the bank!).
I have been paying this off for around 7 years now with a DMP with CCCS and have cleared around £92,000 which includes £25,000 from the sale of my house which I eventually had to do to pay the Inland revenue, but I am confident I will own again. So I now have around £20,000 debt which should get paid within the next two or three years.
My income is pretty good, not massive, about £40,000 now but was about £25,000 when I started paying my debts.
I have learnt many money saving tricks on the way including rarely switching on my heating and hot water. I have a very efficient cheap to run oil radiator which I keep in my lounge and deliberately rent a first floor flat now which is sandwiched between people downstairs and upstairs so I "share" their heat. I only take showers and I fill my washing up bowl from the shower. In the winter in the evenings I wear pyjamas and a onesie and a very thick warm towelling robe which my mother bought me one birthday. I also wear a hat if its very cold so I do tend to look fairly ridiculous and about 20 stone because of all my layers, so would not recommend this look in company

I am a single parent with one daughter who is now at university but who was about 12 or 13 when I started this journey. She has always led a full life and did many things when not at school which I managed to keep paying for while I was paying my debt e.g singing and flute to grade 8, rides a horse well and has always participated in drama groups. And she always had plenty to eat, and plenty of love, of course.
I think a lot of people worry about the effect paying debts may have on their children but I feel she has actually benefitted in ways from what I am going through as she decided to work 30 hours + per week in a supermarket to pay for herself going through university so she that she has no loans/debts after seeing what has happened to me, and her academic performance does not seem to have suffered from working as she has recently been told that the university intend to give her a full scholarship to do her MA, this is based on her academic performance up to now, not on her financial situation. Her intention is to be a lecturer. She has for the last few years refused to take any money from me, even a small amount of say £5 as she wants to "do it on her own". She also worked through doing her AS and A levels but gained all A grades in them and a distinction in a further paper she took. (Mind you, three months before each round of exams that she had I would pack away the TV and monitor her computer usage and she would grumble no end for a couple of days and then she was fine). After she finished her exams she could watch TV and stay on the computer all night if she wanted, I didn't care! And now, she's not that bothered about TV watching. It also saved me electricity money hee hee! She has also since thanked me for doing this although it was hard doing it at the time, I felt a bit sorry for her

Out of absolute sheer desperation to find more money, I started an ebay business which now gives me an extra £1000 in my hand income per month and I hope will continue to grow. Two years ago I was making nothing on ebay. This took me several years and many hours of research to find reliable suppliers that I could buy at a price to undercut everyone else on ebay and learning ways to comply with the strict ebay rules so they didn't shut me down like they do to a lot of sellers. But I was not going out much because I couldn't afford it so I had plenty of time to do this. (This time I have put away my tax so I don't spend it!).
I have never had any financial help from anyone else, family or friends, to pay this back. I had a small amount per month in child support from my daughter's father awarded by the CSA until my daughter was 16. My father passed away in 1993 and I have no brothers or sisters.
Reading this back it may come across to some people as "haven't I done well" but this is not my intention, indeed I never ever intended to post on here as for years as I was so ashamed of myself, but I read a lot of stories on here about people who think they can't cope, effect on their children etc, but I just wanted to tell them it doesn't have to turn out bad. That is my only reason for posting this.
At times I have felt lonely and desperate, particularly at the beginning when I admitted the extent of my debts, but I never would have considered bankruptcy, as I feel I made my bed, I lie in it. I am not saying however that bankruptcy would not be the right thing for others as everyone's situation is different.
I have witnessed to a small extent the trauma that can happen to a family when someone takes their own life through debt as my cousin's husband did when he jumped off a bridge. This should never happen. Its only money. The fact is, they can't take off you what you haven't got. No-one would let you starve or end up on the streets, nor your children. Without the least intention of sounding blase, perhaps you may go without a few things for a while and you may lose your house as I did but hey, so what, I'm still here and the sun is shining outside and I feel happy!
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Comments
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Thanks, that's really inspirational. Well done.I'm a qualified accountant but please make sure you get expert advice as any opinion is made in a private capacity.
"A goal without a plan is just a wish" Antoine de Saint-Exupery
Mortgage overpay 2012: £10,815; 2013: £27,562
Mortgage start £264k, now £232k0 -
WOW 97k cleared! Massive well done to you
Keep it up!!
What will your verse be?
R.I.P Robin Williams.0 -
Conratulatons to you!!!
Vety inspirational and a couple of points have really hit home:
A) I've just started some ad hoc work so I will put aside the tax andI will continue to involve my son in my debt free journey as to be honest I havent been a financial example up til now!!
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Many thanks for your replies, and prettyplease i think it is good to involve your children to a certain extent as long as they see that you are happy and it really isn't going to affect them much. Like I told her she didn't have to give up anything she liked doing outside of school, she would still see all her friends etc, all the stuff like that that is important to a child. I did this by simply not spending anything on myself, like I just used all the clothes I already had and repaired them when necessary, used up all my make up, I grew my hair long so I didn't have to pay for haircuts, and I cut hers and eventually she started to cut mine for me. I also taught her about loans and credit cards and about interest rates and late payments and the affect of credit ratings and how much money you could save by paying for stuff up front! I think I may have gone a bit overboard though because now she thinks credit is the devil!
At first when I couldn't afford some material possession that she wanted she would stamp her feet loudly up the stairs, slam doors and declare she was leaving home because of how she was being treated etc lol. She even threw a phone at a wall and made a big hole in the plasterboard once. She paid for it out of her spends mind...... And another time she "borrowed" my debit card and went online with it and bought something for herself that she wanted that I said she couldn't have. So I told her if she did it again I would ban her from using the computer for a year. She knew I meant it because I always follow through so she never did it again
But overall I shouldn't think having less material possessions did her much harm!0 -
Oh wow!!!
So many lessons learned but all very good ones. I'm determined my son wont lose out either however I'm starting to see he expects me to be his cash cow and that needs to gradually change... sadly I don't follow through enoughbut I'm learning!
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PrettyPlease, I don't know how old your son is but maybe this might be interesting to you. http://www.pfeg.org/0
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I didn't always follow through either much when she was very young as i hated saying no to her but it got me nowhere so I changed my tack over that! And I only look at money/possessions differently now as it got me into a whole heap of trouble by spending loads on c**p I thought I needed and not even thinking about the day I would have to pay it back.. If i hadn't had to pay it back I would probably still be spending without a care in the world
But now I intend that no-one and I mean no one, no credit card companies, no loans companies, no utilities company or anyone else will be making pot loads of money from me in the future! I do have this sense of obligation to pay back in full though what I borrowed. I even intend to pay for a house with cash in the future now I know how to save up! That may be unrealistic....0 -
Thanks so much for this. I find it really inspirational, as I have 2 children (8 and 4) who I am determined will not grow up being as naive about money as I was.Ninja Saving Turtle0
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That's really inspiration, you SHOULD congratulate yourself, both on getting yourself out of a hole and being a great parent - your daughter sounds like a star!0
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Yes wannabee_in_credit, I wish I been asked to think more about being in debt when I was younger and about saving for what you want. I definitely think money management should be discussed quite extensively with all children either at home or at school, although I do think teachers already have a lot on their plate (I am not a teacher myself). Its not like I did not know when I was younger that being in debt was bad or I did not understand how loans and credit cards and interest worked and that it would need to be paid back, far from it, but I just ignored it for too long as I had never been asked to really THINK/get it into my conscious mind when I was younger about the effect on my life that out of control debt could have. If you get me. Having said that, the responsibility for my situation still lies fully with me.
I think an important lesson for all children is the distinction between want and need.0
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