I almost drowned in my debt and I learned a hard lesson (5 October 2011)

Debt.  Being in debt is is one of the biggest stresses a person can face, I know, I’ve been there.  Paying minimum credit card payments back each month just to keep them off your back and getting nowhere with actually paying off the debt.  

You see no light at the end of the tunnel, no end to the money problems.  All you see is a credit card bill each month that’s not going away.  I can describe as feeling that you’re under water and you can’t swim up and break out into the fresh air.

It happened for me when I was in my late teens.  The bank offered me a credit card.  I took it.  I went shopping.  TV, DVD, new stereo, and really that’s all I can remember buying with it.  Other than that I suppose I took money out to pay for nights out, or bought clothes, books, DVD’s but truthfully I have no idea what I spent thousands of pounds on.

Having run that up I was then in a clothing store one afternoon and offered a store card.  I took it.  There was a modest £500 limit on it but that soon went up, and not at my request either, I might add.  That limit was reached in no time, I looked snazzy but I had no money.

So each month I had a credit card bill coming in and a store card bill coming in.  Each card at their limit and of no use to me.  Each month I paid the minimum amount, which were nearly £100 for the credit card and around £70 for the store card, and in actual fact, because of interest, I was only paying a few pounds to the actual bill.  Nothing was getting solved and I had around £170 coming off a frankly crap wage each month.  I was in my early twenties, no money and had thousands of pounds worth of debt.  

In order to live I then found myself getting subs at work out of the next months wage which meant that every month my wages, already low, were even lower.  This whole situation went on for a few years, I’m sad to say, before I took a deep breath and sorted it.  

It happened in the week of my birthday a few years ago.  I was on holiday from work and sitting looking at another bill thinking that I couldn’t go into another birthday with all this debt.  Every month it was getting worse and worse and my boss saying he might have to stop the subs because he didn’t do it for other people.  Although my pay was better by then I still didn’t have any hope of just paying off the debt with my wages.

I phoned my bank and arranged a meeting with the manager.  On a rainy day I went to see her and spent over an hour with her sorting out my problem.  She gave me a loan that immediately paid off the two debts and she arranged for me to pay the most back to the loan each month that I could and in the end I would pay this back for four years and after that no more debt.  It seemed like light at the end of the tunnel at last.  It would be frugal living for four years but there was an end to it.  The bank manager took my credit card and my store card and cut them up in front of me.  

I left the bank clutching my loan documents and I was actually weak with relief.  I don’t even remember getting home that day.  All I could think of was that in four years I would be debt free.
Four years later, in the week of my birthday, I paid that last loan payment and I had a letter from my bank saying my debt was zero.  The loan was paid back.  No more debt.  I felt liberated.

Since then I’ve kept it that way.  I learned a hard lesson but I did learn it.  I’m very money conscious now.  Stingy some may say but then again, I don’t owe anyone anything.  I have a credit card and I have another store card but the credit card I use for online transactions and it gets paid off every month.  The store card I haven’t used in over a year and even when I do it’s paid off at the next bill.  Yes my wages are better these days and that does help.

I cringe when I hear someone say their teenage daughter has just got a credit card.  I know the road ahead.  Even when I went to get the credit card I have this time, I asked for a £1,000 limit (for emergencies) which was agreed and when the card arrived through the post it had a £3,000 limit.  That’s banks for you! I haven’t changed it because I know I won’t use it but I do know people who would run up that £3,000 limit simply because it’s there.

I still have some of those credit card bills from before and when I’m sorting through other things I often come across them and they’re a great reminder of the dangers of credit cards.