Coming back from the brink

BackFromTheBrink_2

After years of reading this forum, I decided it was a good time to contribute something myself. Here, in a long and winding fashion, are the beginnings of my story!

From the moment my bank gave me a credit card with a £1,000 limit the year I went to university, I have been in debt. Credit cards and store cards, student and personal loans – there aren’t many sources of credit that I haven’t tapped into over the past 15 years.

The ease with which I’ve been able to borrow has always been compounded by a horrible habit of burying my head in the sand. Although I have never missed a repayment on any account, there have been many occasions where I was too weak to face up to the amount I owed and simply added another credit card to my poisonous portfolio whenever my outgoings overtook my income.

There have been times when I’ve made a dent in the debt (although that has twice been through the false hope of consolidation loans), but the slide back into the red has been as inevitable as the sun rising in the morning.

This hopeless cycle has taken place against a backdrop of what I now know to have been quite severe depression. I had always thought my low moods were just something that everyone goes through, but that all changed last December.

After driving for nearly two hours, I found myself on a freezing beach on the south coast at 3am completely set on the idea of walking into the sea and swimming until the cold took me under. I wasn’t upset or emotional; I was completely dispassionate at the prospect of ending my life.

I don’t know what it was that stopped me from going through with my plan, but after another couple of hours I was back in my car. I still felt numb, but the experience had stirred a desire to carry on. The next day, I made an appointment with my GP (for which I had to wait two weeks – thanks NHS!) and booked a private appointment with a counsellor.

The combination of therapy and medication stabilised my mood and by the start of 2015 I was feeling much stronger. My therapist suggested finding a hobby to give myself something to focus on and I decided that project would be to finally take charge of my finances.

At the time, I owed just shy of £24,000 over two unsecured loans, one student loan, four credit cards and a storecard. Although I had enough to make the loan repayments and pay minimums on the cards, I never used any excess cash to pay off debts. Instead, I would quite often pay the minimum amounts and then use the cards during the month, placing myself further in debt.

I was completely overwhelmed at the scale of what I owed, but viewing paying it all back as part of my new project made it somehow manageable. I sat down and worked out what I was spending each month, took the credit cards out of my wallet so I couldn’t use them on impulse and made a plan to get myself out of debt.

I won’t bore you with the ins and outs of the past 10 months in this post, but I’m very proud to say that I have achieved more than I could have hoped for. It’s been a tough year and I haven’t had much in the way of fun, but my total debt is now down to £7,248.

My loans have been paid off early, as has my student loan. The storecard has gone and the remaining debt is now spread across three balance transfer credit cards for which I will pay no interest as long as I clear the balances by the end of next year.

I’m pleased with my progress, but – much like my mental health – I know that my financial health will require constant work. £7,248 is still an awful lot of money and I won’t be happy until that figure reaches (and stays at) £0.

To that end, this diary will document what I hope will be the final steps of my debt-free journey. I’ve learned so much from reading these forums without ever contributing myself and I hope that any posts I make might resonate with someone, somewhere.

Anyway, I’ve just purchased You Need A Budget and am in the process of setting that up for me to start using it from December 1. That will be the focus of my next post.

Thanks for reading this wall of text and apologies if I'm not doing this right!

NoOneAround

So glad that something brought you Back from the Brink that night, Just look at your amazing progress this past year! Life is a gift, though it might not always seem like it when you are in the depths of depression, it may not always be easy, or happy but it is too precious to end. So Sorry, that was not meant to sound like a sermon!

You should be really proud of how far you have come already,
do you have family and friends nearby to support you?
Wishing you luck with the rest of your journey to debt freedom.

NOA
x

BackFromTheBrink_2

Thank you, NOA.

No worries about the sermon – you're absolutely right, but like you say it is not always easy to remember! All I know at the moment is that I'm very, very glad to still be here.

I don't have many friends, but I am lucky to have loving parents and a great sister (along with a niece and nephew with enough energy to power the National Grid). I'm not very good at asking for their help and they've got no idea about how bad things got for me, but that's another thing I'm hoping to improve along with my debts!

EssexHebridean

What a tremendously brave post - thank you. welcome to MSE, and specifically the DFD board. :-)

BackFromTheBrink_2

Thanks, EssexHebridean :-)

Well, it's the end of my first day as a diarist (is that still a word?). Writing things down was another thing my therapist suggested doing, so maybe this process will be good in more ways than one!

I'll get into writing with a bit of structure over time, but for now it's probably sensible to come up with some goals. So, in no particular order, here is what I want to achieve...

1. Clear my outstanding debt by August
As I mentioned previously, I've spent the past year living a monk-like existence. I haven't been on holiday, cook in bulk at weekends fore the week ahead and have even resorted to selling my beloved bike to raise a bit of extra cash. It has been hard, but seeing the results has kept me going. Now I want to pay up to £1,000 per month towards the debt so that I'll be free of it by the summer!

2. Continue with therapy
The one expense I have allowed myself this year has been a twice-monthly appointment with a therapist. He is really great and provides his services for a cheaper price than normal, but it's still £60 each month. That being said (and without wanting to sound melodramatic), his help is a huge factor in keeping me from slipping back to that dark place so it's a cost I'm going to continue to bear.

3. Run a marathon in 2016
Although I'm never going to win any races, I'm not a bad runner and I've got back into exercise over the last few months as I've felt stronger mentally. I've finished a few marathons before and really want to do another, almost as a marker to show that I'm back and ready to reclaim the old me! To that end, I'm going to pick a race for the end of the year and train for it.

4. Become a YNAB master!
I've seen so many evangelical reviews of YNAB, but when I tried it during this year I just couldn't get going. I really want to learn to budget and know what I can and can't spend on certain things, so I'll be making a concerted effort to learn starting from December 1. Any advice very gratefully received!

5. Try and make some friends
I used to have a lot of good friends from school and university, but I drifted away from them as my mood kept fluctuating and I became really anxious around people. I don't really have anyone left that I would think I could go for a drink with or have over for an evening and I get a bit lonely sometimes. I'm going to try reconnecting with some of my old friends and perhaps join a sports club or something to meet new people.

I think that will do for now! Thank you for reading and I look forward to spouting more hot air soon!

EssexHebridean

Writing stuff down is a brilliant way of clearing what the lovely Pippi on these boards calls "washing machine head" - doesn't need to be public either - I've got pages of random ramblings on one of those private writing sites, works a treat for me!

Totally agree with your therapy being a required expense - if it's helping, it's helping!

I've never used YNAB but know a lot of folk love it. I stick with my trusty spreadsheets, a couple of notebooks, and the budget brain tool on here done every now and again. Works for me!

BackFromTheBrink_2

OK, time for a brief update on this week's debt-busting activities!

To start with, I fired up YNAB and have been trying to make sense of it. I plugged in all of my direct debits and used the last two months’ statements to come up with a rough estimate for what I’ll spend on various things during December.

I’ve never really looked in much detail at where my money goes each month, so seeing it all laid out in neat rows was a revelation! The only problems I have run into have been caused by starting this final push to debt-freedom during December. My car (a reliable old Ford I’ve had for 8 years) needs an MOT and I’ve got to think about presents for family members.

Not sure if I’m being wildly optimistic, but I’ve set aside £250 for each. If the car costs more than that, my plan is to spend less on presents. If by some miracle it sails through the MOT, I’ll put the excess towards paying off my credit cards.

On that note, I’ve had a proper look at the credit cards and altered my direct debits for each. The amounts owed are as follows:

Barclaycard: £3,245
HSBC: £2,762
Sainsbury’s Bank: £1,241

As I’ve been hammering through my other debts this year, I’ve only been paying the minimum amounts off each of these cards so that I could clear the accounts I’m paying interest on. Now that is done, I’ve decided to pay £333 off the remaining credit cards every month. It will mean keeping my belt completely tightened for a bit longer, but the thought of being free of the debt will hopefully keep me going!

My plan is to pay £333 off all three until April, when the Sainsbury’s balance will be cleared and I’ll have £91 extra to add to the HSBC payment (making a total of £424). I’ll then be able to pay £666 off the HSBC card in May and June, clearing that completely and leaving me £999 for the Barclaycard balance, which by that point should be £1,247.

I’ve got a little bit of money saved for a rainy day, so I think I’ll use some of that in July to completely clear the Barclaycard, in turn ridding me of debt!

I’m not very good with numbers, but sitting down and going through all of this has been such a positive experience. I used to be so scared of thinking about what I owed and how I was going to pay it back that I didn’t dare to look at the figures, but I wish I had been braver sooner.

As far as my other goals go, I found a marathon training plan online and have been out for the first three sessions. I’m going to try and build up a bit of strength and join the local running club, but I get very anxious about new situations so that will probably take some time.
My mental health has been pretty good for the last month, certainly better than it has been for the last couple of years. I’ve even been thinking about asking the doctor whether I should be reducing the medication I’m on, but I’m going to see how things go for a bit longer as I know from past experience that highs can very quickly turn into lows.

I also had my (gulp) 34th birthday this week and spent the day with my family, including my adorable niece and nephew. Seeing them always make me glad I’m still here.

Thanks for reading!

EssexHebridean

Your plan sounds good....an alternative (and only you know if this could work better for you) would be to keep paying minimums on the two higher balances, while throwing everything else at the Sainsburys one. That will get that cleared sooner - giving you an nice "Woo Hoo!" moment to celebrate at what can otherwise be a rather grey, dreary time of year. Then switch to throwing everything at HSBC until that's gone...at which time you should only have in the region of three/four payments to clear the biggest of the bunch, too. Shouldn't make any difference to when things will be totally cleared, if everything is still 0% then it won't cost you any extra. Just depends how much you think having the slightly more immediate boost from clearing individual debts might help your mindset, going forwards.

Your christmas/car plan also sounds sensible - fingers crossed the car will behave nicely!

knightley

@BackFromTheBrink: you sound absolutely amazing and inspiring! I don't have much to say in terms of advice, but I wish you all the best for 2016 and hope you achieve your goals! I'll be following your diary, I like your determination.