Monday, 5 December 2011

The hardest realisation is that you brought it on yourself

Ew, gross, debt... There was once a time that debt was so massively frowned upon that people had to see the bank manager just to buy a new bed. But then came Credit Cards, Banking Call Centres and Sales People whose job it was to sell you credit, thousands of pounds of it and gullible people like me just dying to buy on the never never...

My current financial situation can be traced back to childhood pocket money. Whatever I received, I wanted to spend there and then. I very rarely saved up for something I wanted. If I didn't have enough money, I'd buy something of lesser value. In fact, I can't think of one think I saved up for when I was a kid. I didn't really know the value of money, but it didn't really matter because I was a little kid.

When I was eighteen, the bank heard I was going to university and started to offer me all these wonderful bits of credit - Student Bank Account, Overdraft, Credit Card, Extension after Extension. At one point, my total debt from credit was around £7000.00 and I was earning £4.10/hour and working 12 hours per week. The whole time I was at university, they never minded and just kept upping my overdraft whenever I needed it. They even gave me a cheque book! Eventually, my Student Loan payments were only taking me up to zero. I have been in the red most of my adult life.

Within six months of leaving university, the bank had begun calling me twice a day asking me to start paying it back. I was only earning around £300.00/month, some of which went to my parents for rent, and so I asked for an arrangement of £100.00/month which they agreed to, for three months after which I would call to discuss it and see how it was going. Brilliant, I thought, £100.00/month was entirely manageable.

Three months later I called up to discuss the arrangement, and silly me, because I'd been paying on time for three whole months, I thought this would be my long term arrangement. No, they insisted that they wanted the full amount paid back over 6 months, around £350.00/month. By this point, I'd found a better job, but was now living away from home, supporting my partner, paying bills and gleaning a tiny amount of social life. My father very kindly offered to take out a loan to cover my debt over five years which I would then pay instalments to him for. 

Two years later, I went back to university to study my teaching degree. Once again my bank (the same one) came calling again. Once again I was offered an overdraft and my credit card limit was increased. I feel sick now, thinking how I squandered that money. Except, well I didn't really. I had a bursary from the University, from which I paid the loan payments, my travel expenses (bus, train and tram - around £90.00/month as an estimate), I paid for my books and materials, lunches in the canteen and the odd dinner. My most extravagant expense was driving lessons. Very extravagant, but the best thing I ever did for myself. 

When I finished university in June 2009, I started looking for jobs straight away. I was lucky to find the one I'm still in today, and I intended to pay off what I owed and get back in the black, but being in full time employment had its perks, catalogue companies were more than willing to offer me credit (I've now got this under control), and Santander gave me a car loan. The bank were still offering to up my overdraft limit - they did it twice more, taking me to -£1200.00, which is the figure I'm at today.

In March 2011, I did something very stupid which seemed sensible at the time. I blame myself, but I feel I should also give the bank some credit. They offered me a loan to clear all of my debts. I wish I'd never taken it. I could have paid the amount I'm paying now to my credit card, and it would probably be nearly paid off. I think that when you sign up for a loan (and by sign up, I mean when you are sold a loan by the bank which you no longer have to physically sign anything for), it should be with certain conditions, like - "if we give you this loan, the credit card company will no longer offer you credit", or "if we give you this loan, we will automatically close your overdraft". A few months after I took out the loan, the credit card company offered me an increase in my limit. They tell you to call if you don't want it. Stupid stupid stupid me. 

But the never never has just caught up with me. I'm not sure what prompted me to do it, but tonight I calculated everything I owe, and it's not pretty. I won't write down the figure, I'm far too embarrassed, but put it this way, if I'd saved that much I'd have a decent deposit for a house. I felt pretty sick, and my girlfriend just happened to take a photograph at the moment I realised and post it on Facebook. So, for the foreseeable future, in fact for the next couple of years I won't be much fun. But if I ever want to be out of debt, I will have to stop having a life... 

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