As a child, we are not told or taught about debt. Money, that magic thing that buys the Friday night treat and keeps petrol in the car, is the dominion of the adults. Money, even pocket money, for children is instant gratification. Someone gives us pocket money and bam! Sweets. No debts either – granny will happily gift us our weekly sweet allowance and not expect a return on her gift. Sadly, being a functioning adult means that our Friday pizza fund and the fuel money has to be earned the hard way – with work. I’m making the assumption that we all need jobs because we don’t have trust funds or major lottery wins keeping us in Anchor Spreadable and Haribo. But here’s the rub: just having a job isn’t always enough to have the amount of money we need for the things we need and, more often, want. This is where the big, bad wolf of Debt appears.
In the spirit of full disclosure, I have not been good with money. Despite having had a job or sorts since I was 12 (hairdressers, sweeping up hair for £12 a day), I didn’t understand money and debt and how credit works. I’m not proud of this. Frankly, it’s embarrassing. I’m very glad that I got to grips with my debt, albeit after many tears, 3am panic attacks and one fraught meeting with a bank manager. As of July 1st, I am officially debt free. Now, there will be those that say I can’t class myself as debt free because I still owe about 8k on my student loan. I don’t count this as debt for many reasons, but mainly because it comes out of my paycheck before the money hits my bank account. If I had to repay this after my salary was paid, then it would count.
My relationship with money has never been easy. I’ve been in a relationship where I was essentially a walking cashpoint and nursery fee payer. I’ve been in relationships where money has been the final nail in the coffin which lead to its eventual demise. I got a credit card while I was at uni, not knowing *quite* what to do with it and true to form, didn’t get that I had to pay it back, with interest. The interest was a shock. I feel stupid now, having made it to almost 20 and not understanding how credit works. I continued to be stupid with money though, employing the well known ostrich technique of ignoring all brown envelopes and spending on my credit card, making bad decision after bad decision.
However, the story doesn’t end badly. 6 years after meeting Husband I’ve paid off ALL my debt. Yes. The credit card maxed out? Gone. The loan for the car (that I had to sell because I couldn’t afford it)? Gone. The old student overdraft that was sold on? Gone. The sofas on 0% interest? Gone. The loan my parents gave me to get the Ankle of Doom fixed?Gone. We’ve jointly paid off our car, that I was declined finance for because my credit score was so abysmal the bank all but laughed when I submitted my application. My credit score is now officially excellent and I no longer wince when taking cash out. I am also more clued up about money in general. I actively monitor my credit score, I keep a check on my bank accounts (mainly after being hacked, not once but twice – once on Christmas Day!).
If I could go back and tell 20 year old me anything useful, it would be a quick lesson and word of advice about credit cards, money and interest rates. I’d tell her that ignoring your post and phone calls will not make the bank, building society or loan company more understanding or make them write off the debts. I’d advise her NOT to go to CashConverters in Manchester with your paycheck. I’d definitely advise her not to loan money to people when you need that money. But more than anything, I’d tell her that it won’t always be like this. That you’ll grow up and get a handle on your finances and feel relieved that you didn’t declare yourself bankrupt (yes, really, I’d considered it).
If you want to check your credit score for free, I used CreditWise, powered by Capital One. I discovered this service through the wonders of Instagram but the link is here if you want to give it a go – and no, I’m not being paid to write this!