24.. Clearing Debts

darkknight92

Hey everyone - newbie here.

Here is my story. At the grand old age of 21 I started my downhill journey into debt.

Firstly catalog accounts, i'd order shoes, clothes, tablets, I couldn't believe how easy it seemed, buying all of these things without any money leaving my account! I'll think about it later I thought, plenty of time to repay..... In addition to this I had phone contracts, credit cards..... yes it was bad but at the time i was so relaxed about it!

Next I stupidly decided to buy a car on finance, surely another £145 a month wouldn't hurt? I still lived at home so I had plenty of disposable income.

Well that's when life hit, and boy it hit hard. My girlfriend got pregnant so I had to grow up quickly, we moved out of my parents place after scraping together a deposit for a flat and for the first time in my life I regretted all of my credit decisions. The reality of life kicked in. The buy now pay later deals ended, the debt hit hard and it hit fast 39.99% !!

I was struggling to look after my family because of the debts, i checked my credit file and i was horrified to discover I owed almost £20,000 on a single salary of 18k PA.

So we struggled week in and week out, toiling away at the debts for 3 years, we had around £70 a month left disposable if we were lucky every payday for baby clothes, Christmas was hard.

Until finally I had a lucky break, we inherited £16k from family which to be honest was a dream come true, we cleared 15k worth of debt and spent 1k on improving our lifestyle, replacing furniture, appliances etc.

Skip to today, luckily since then my salary has risen to around £26k PA, I am still paying off debt which I hope to clear this year...finally. We spend £30 a week on groceries (yes it really can be done) and really only try to buy things we essentially need. My disposable income has more than tripled but all of this is now spent on clearing debts.

The entire experience has been very humbling, I've learnt to respect money, I've learnt the hard lesson at how fast debt can spiral, I amazingly managed to have a credit free Christmas! In addition to this ive also learnt to respect the things I do have in a life, a roof over my head and food in my fridge.

Fingers crossed this time next year I will be completely debt free. :j:j Anytime im tempted i just think back to how depressed the debt made me feel. :beer:

Anyway, that is my story. Looking forward to getting involved in some conversations!

enthusiasticsaver

Interesting story and glad things are starting to look better for you.

You are still quite young and knocked the debt on the head before it became completely unmanageable. I seriously believe parents and schools need to educate young teenagers on how to manage money, budget and how quickly the debt spiral can happen for people such as it did for you. Teach your child as he or she gets older of the perils of credit cards, buy now pay later deals and this experience will not be wasted.

I stressed on my daughters from very young that credit cards are not a good idea and are too tempting when you are young and on a low wage. Luckily they seemed to heed the lesson and now they are adults manage their money well.

Remembering how being in debt felt is a way to avoid repeating mistakes. Learning to budget and building up savings to pay for cars and holidays etc and also learning to distinguish between wants and needs are all good things to aim for and you certainly seem to have made a good start. Well done on a debt free Christmas.

sourcrates

enthusiasticsaver wrote: »

I stressed on my daughters from very young that credit cards are not a good idea and are too tempting when you are young and on a low wage. Luckily they seemed to heed the lesson and now they are adults manage their money well.
.

My eldest is 14 and I try to stress to her the importance of money management for when she leaves school.

She still thinks money grows on trees, but hopefully in time she will take notice.