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Friday, 4 July 2014

One step closer to financial freedom

Once upon a time I thought nothing of having expensive hair cuts, buying designer make-up and luxury perfume, spending regularly in top-end high street shops (think Hobbs, L.K. Bennett, Reiss etc), and even putting entire holidays on my credit card. I managed to justify my spending as I was earning decent money in Financial Services and mistakenly thought it would be pretty easy to pay off my credit card when I was ready. But of course there never seemed like a good time to sacrifice my expensive monthly treats, or god forbid my much treasured holidays, and instead pay down some of my debt. Years rolled by and my debt simply grew. When I maxed out my credit card I just got another one. When that was maxed out I extended my overdraft etc etc... you get the idea!

I've always agreed with Mae West that "too much of a good thing can be wonderful" and unfortunately my binge spending goes hand-in-hand with my tendency to binge eat, drink and smoke. Not a pretty picture I'm painting of myself, I know!  

Not long ago it got to the point where my monthly credit card and other debt repayments were so high that I struggled to afford actual essentials. You know, things like food and rent! I had no savings, wasn't paying into a pension and was living hand to mouth. 

Inevitably I would spend most of my money in the first few weeks after getting paid so when it came to the last week before pay-day I would have zero cash to do anything at all which was so boring and incredibly stressful. I would also regularly go overdrawn on my bank account which would then incur a lovely £60 fine just to add to my woes. 

THIS WAS MADNESS!!! I even knew it was bad at the time but I truly didn't realise how incredibly stupid this behaviour was until years later when it all caught up with me spectacularly and I realised I was in way over my head as far as my debt was concerned. 

Thankfully I have married someone who is incredibly sensible and cautious when it comes to personal finance. Needless to say he was shocked and highly unimpressed when he discovered how bad it had got. During a very serious chat last year he verbally yanked my head out of the sand where it had been happily buried for about 10 years, and we agreed something major had to change - fast.

And so, in October last year I reluctantly but sensibly agreed to try sticking to an actual budget for the first time in my life. I handed all my credit cards over to my husband and haven't used them since. I completely stopped taking on any new debt and slowly but surely started to make a dent in the massive £15,000 I owed. 

It hasn't exactly been fun and I really miss being able to have a blow-dry to perk me up or splurge on new clothes every few months. However, I can honestly say I have never felt in better shape financially and that feeling of control and honesty is SO much better than the constant underlying stress I used to feel whenever I thought about my money situation. 

A huge dead weight has been lifted from my shoulders.

I am thrilled to say that on Monday I paid off £4,000 of credit card debt! This is very exciting for me as I'm now much closer to my end goal of being debt free before the end of 2015. Of course, if I can get debt free before then that would be amazing and I will do this if I can.  

However, I have lots of other goals I'm working on too, including getting fit and healthy and also transforming my work-life. These two things are critical to my immediate happiness and are therefore a major priority for me so they come over and above debt repayment.

For example, I'd rather spend a little more money each week on delicious healthy food than save money on groceries by buying ready meals and fast food. I also recently forked out for a 28 day programme to help me quit sugar when I could have put this money towards debt repayment. But I'm confident that being healthy will make me feel far better in the immediate future than paying down a tiny bit more of my debt, so I made the choice.

I want to be sure not to fall into the trap (again!) of taking jobs purely for the high salary on offer. I'm now committed to prioritising career fulfilment and creating a more happy and fun life for myself instead of working to just to pay bills and indulge in treats to help me forget I don't enjoy what I do 5 days a week. So again, job satisfaction is a priority for me over and above debt repayment.

So here I am, 10 months on from starting my journey towards financial freedom. I still don't have a pension and I have a sizeable amount of debt remaining but I really, truly feel I'm well on my way now to reaching my target of getting, and staying, out of debt long term. 

And that feels so much better than any shopping spree ever could.

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