Hi everyone, how are you all today.
Today’s post is quite hard for me to write, but I hope that it helps anyone who may be close to getting themselves in a similar situation that I got myself into.
I have struggled with debt for the past 6 years. This has been a combination of loans and credit cards, and I’m very ashamed of myself for getting in this situation in the first place. However, it happened and I’m so glad that I’m now in better control of everything.
But today, I’m going to tell you the full story and I hope that it helps anyone who needs to hear it.
In the Beginning….
Okay, let’s get this started…. I was 26 and had an excellent credit score and a well-paying job. I had just completed a makeup artistry course and wanted to start doing people’s makeup as a side hustle. However, I needed a kit. So I did what I thought was the sensible thing and took out a credit card. I only wanted a £1000 limit to prevent any overspending, however my credit was that good, they gave me a£5000 limit.
Worst idea ever!
Like any person with no clue about credit cards, I started spending all this free money, realising that I had no means to pay all of it back. Oh shit!
So clever me took out a loan to cover the credit card. Panic averted!
Now, the sensible thing to do here would have been to reduce the credit card to what I wanted and just pay off the loan.
I wasn’t sensible!
I just spent it again!!! I was able to top up my original loan to £8000 to cover the new spending.
And I still didn’t reduce my credit limit! Honestly, looking back, I could kick myself. It’s definitely not an excuse, but my overspending had a lot to do with me trying to cope with an undiagnosed anxiety disorder, and shopping was my coping strategy; and definitely an unhealthy one! I mean, I filled up a credit card 3 times without blinking an eye, leaving myself with quite a lot of debt in different places.
What options did I have? Another loan?
By this point my bank refused to give me another loan so I was stuck paying £120 on a loan plus paying off my credit card. It was starting to get a bit unmanageable.
My only option was to take out a 0 % APR credit card and transfer the original credit to that.
So I slowly paid off this (or tried to) and was able to build up my credit enough to take out another loan to buy my rental car. Then it all went tits up again!
Enter my ex. You’d think 2 incomes would be amazing to start paying off some of this debt, but nope.
I have no idea what happened to my money. I was paying almost £1000 total in bills and debt payoff, which left me very little to myself…. And this went into a joint slush fund with my ex. This money went down really quick on groceries, fuel and I have no idea what else my ex spent the money on, and honestly I don’t want to know. He had his secrets and I would rather not pry.
This time is when my credit score really took a hit. I started missing payments. And my overdraft grew really big to help make ends meet.
Honestly, I was really relieved for more than one reason for that relationship coming to an end. But this post isn’t for that!
Telling my Mam
After moving back home, I told my Mam the full extent of my debt, and she was able to help me come up with a plan to pay off these debts. In less than 8 months I reduced my £15000 worth of debt by £2000 (yes I was paying rent to my mam- she just taught me how to manage my money better).
When I first moved back in, I tried applying for a consolidation loan to get everything under one payment. Some APRs for the loans and credit cards was really high, so I was paying back a lot! However my credit score was that low, my bank refused.
So I just chipped away at the debt as best as I could for the next few months.
Light at the end of the tunnel….
8 months later, I had managed to reduce my debt by £2000 and my credit score had risen a fair bit. I had also managed to save up a little bit too.
So I tried going for the consolidation loan again.
Luckily, this time I was accepted. The loan has reduced my payments by £300 so I’m actually able to save up a bit more each month. I’m also planning on trying to pay off this loan a bit faster with any additional pay I might make. What’s the point in spending stuff I’m not used to having anyway?
Six years have gone by and I’m finally in a much better financial situation. I am saving for a mortgage and my debt is going down steadily.
It’s been a long, stressful journey but I’m so glad to see some light at the end of the tunnel.
My only advise is this: credit cards may look tempting by giving you extra money to play with, however unless you can pay off that limit straight away, you’ll be paying more than what those items originally cost.
Avoid credit cards like the plague! Save up for the things you really want instead.
I hope that hearing my story helps a few people, and thanks for reading.
Have a lovely day guys, and take care.