The wind is whipping up a storm outside my office-cum-hobby room window. I can see the small saplings on the green almost bent double under the constant onslaught. I know how they feel. Yesterday there was a storm in this room, except it was the wind of change ripping through and I was bent double.
It was the day of my lightbulb moment.
Last month my bills and minimum debt payments just about crucified us. We were within £20 of our overdraft limits on our current accounts - that's £20 for the three of them or an average of £6.66 away from a bank charge. Next month we don't think we are going to make it. We think for the first time we will default. We are no longer liquid.
Five years ago I went freelance in January 2005 and we moved house in April 2005. That was the start of the slide. A bigger house that cost more to live in, a much smaller income for one of us. I had a couple of thousand on my credit cards, a persistent little leftover from a holiday to Australia three years before I just couldn't shift on my pay since then.
I built my income up to cover my bills then illness hit me in September 2005 and my £1600 of savings didn't last long. Then there was no income but the credit cards for four months. I got back on my feet and carried on. I relapsed a year later. A reduced income for three months and the credit cards supplemented the rest. Then I took on a business coach. Three £1200 payments later I realised I was a mug and canceled the contract. All the time I pretended I was ok to my spouse.
The next year a client went bust owing me just under £10k. The credit cards funded some of the missing income and, for the first time, the tax payments. My monthly expenses were increasing to cover the interest. The recession hit me and work dropped off over the next year. Every job I pitched for I lost to someone massively undercutting me. The credit cards were being trojans - they covered work expenses, travel costs, birthdays and Christmas. They covered meals out when I was too embarrassed to tell friends I was skint. They covered my share of the new conservatory when I didn't have the guts to tell my husband I didn't have the money. They covered vets bills when my current account clearly couldn't and I couldn't bear to let the animals suffer because of my stupidity. I still maintained I was ok, but I was hurting.
Strangely through all this, they rarely saw a sniff of consumer goods. I don't buy things for myself. I never have. I hate shopping and I've always worn clothes until they were holey. To me this lack of money felt wrong. Surely me, the person who seemed so conservative, so anti-consumerist, shouldn't be suffering like this. In reality I wasn't conservative. I just didn't have clothes or TVs or make-up to show for my spending. Just because it was spent on bills doesn't mean it was noble or justifiable or acceptable. Debt is debt.
I should have got a job at the end of year 3 but I was stubborn. I was going to turn this around. I refinanced everything into a loan and vowed to stay off the credit cards. Now let's cut to year 5.5 shall we? Two more years of expenses on the cards, even less work than before and another year's taxes, not to mention a balance transfer of an overdraft along the way. Oh and a mini breakdown on January 4th 2010 where I realised it was my 5th freelance anniversary and I'd never been more miserable. I cried solidly for three hours. Then got up and carried on. Just slap me.
So where are we now?
Every month we're around £700 short on living expenses that would usually have come from my side of the deal. My spouse is bravely stumping it up, but he works a manual job and his income has reduced during the recession. He is in debt now with a loan and credit cards but he has kept hold of one glimmer of hope for us. Through everything he has overpaid the mortgage. Our mortgage term has reduced in half. We feel stupid in a way, that we're in this position yet we're overpaying the mortgage but we can't stop. It's the only one damn good thing we're doing and we must keep doing it.
Next Tuesday I start a new part-time job - I posted off my acceptance of the offer earlier today. I've swallowed my damn pride and am going back to work. I was in line for a full-time position somewhere else that would have seen me earn around £2,200 a month, but they lost a client just as they were about to offer me a job so everything is on hold. That money would have solved a lot of issues, but clearly the universe wants me to learn a lesson and it's not going to make it easy for me. It's going to make me work my little arse off.
This job is only contracted for six months and I'm continuing to look for full-time work, but in the meantime it will bring in around £1000 a month. It's not enough. Not if I want to stop the tax bills going on the credit cards. I still have to work freelance on the remaining days of the week to get the money to pay those (while incurring more tax - ahhhh!) and generate enough to pay the debts off and for the first time in my life budget.
But that's a post for another day.
So now you have my "how I got into debt" story. What's yours?
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