I want to talk to you about debt.
Before you sniff in a derisory way and presume this is a sponsored post, I assure you – it’s not. But given I’m (probably) older than you, and have (probably) dealt with more debt that you, and – for the first time in my thirty-coughcough years – finally feel in control of my cash, I’ve been thinking for some time about talking to you about how I eventually put things right. And though I am not remotely an expert and can only talk to you from my own perspective… it’s my perspective, you know? And if this helps just one person, I’ll be happy. Like: Super Mario happy.
This is likely to be pretty long, as I think it’s important to give some context as to how we got to where we were before I managed to pull ourselves out of it again. Some of it isn’t embarrassing, but some of it really fucking well is. Dip in with as much or as little as you choose. I won’t hold it against you, as long as you promise not to hold my numpty life-choices against me, either.
If you didn’t know, I met my husband when I young. Stupidly young. I had just turned 18, and at no point did I think the guy I bumped into in my local pub a month before I went away to Uni was going to be the guy I’d be with forever. I even went to University across the other side of the country, leaving him at home and not for one second did either of us really think we’d last it out.
It was ridiculous.
Being with someone that young means all the things you’re supposed to do when you meant Your Person – moving in, buying furniture, painting rooms, getting married etc. – happened way too young. I was in full-time education when we rented our first place, full-time education when we bought our first place (yay for 95% mortgages and a £2K deposit I borrowed from my parents!) when M had an entry-level job, and just I was 23 when we got married.
I told you. Too young, right?
Though I’d never change it – I still love my husband so hard it hurts – it meant that we were not financially equipped to do any of that shit, not really. Sure, I was in university at a time when we still had grants, but it wasn’t a 100% one, and though I had student loans they were tiny, which meant I had to work three jobs (both in London and back at home, as it happened) to keep me afloat.
Though we were happy enough with hand-me-down furniture and did all our own DIY (often badly), there were things we had to get ourselves, which meant from the very off, we were climbing into debt. Mortgage aside, we had a car loan (I was commuting 100 miles a day – my 20-year-old monster wreck of a car could not be trusted on the motorway), and furniture loans, and bought things on hire purchase with interest-free credit deals. We were offered no-nonsense credit cards with eyewatering balances hand over fist. Then we had S, on top of all that debt, and though he was a planned pregnancy and we’d actually and sincerely budgeted for creche/nursery fees and clothes and stuff, those creche fees climbed 60% in that first year.
60 goddamn percent. In just twelve months.
It was probably around here things got silly. There were times before – we’ve remortgaged a bunch of time to “release money” from the flat and, latterly, our house, but it was never enough to reset our debt balance to zero – but it was here it took a nosedive, I think. Fuel hiked to eyewatering prices, which hurt when you drive a 100-mile round trip each and every day. We were cashing credit card cheques to pay for petrol and food and more than once, I’d had to cash in the Penny Jar at home to free up twenty quid to tide us over with groceries. I think my assistant in work – that’s right, I went on to have a reasonably well-paid job – had to cover me once or twice at the till in Asda.
Thing is, we’ve always been excellent debtors. We always paid everything on time. Even though it was often robbing Peter to pay Paul – a kind of debtors now-you-see-it-now-you-don’t-extravaganza – we almost always pulled it off, which meant we had huge debts but great credit scores. We didn’t default on anything. Our mortgage payment has never once been late. Our credit card companies kept buffing our credit agreements (at one point, one credit card alone had a top limit of £18,200 WHICH WE USED ENTIRELY).
The job I had before I quit to write FT was wonderfully well-paid. Overpaid, you might say. M had also been promoted, so while he didn’t earn as much as I did (I’ve always been the breadwinner, although I put that squarely down to having a husband who’s always loved and supported me and enabled me to be the breadwinner) in the late-ish 2010s we were taking home somewhere in the region of £700 more than we do today. MORE. I KNOW. AFTER TAX. WHAT THE FUCK WAS I DOING WITH IT ALL?!
We didn’t invest it. Didn’t really pay things off, either. We had money and we enjoyed it, going on trips and holidays and concerts. We took S to NYC when he was just six years old. After a frugal start to married life, it was nice to have money around for the nicer things (even if that money didn’t seem to last the whole month). (OMG WHY DIDN’T I SAVE IT?)
The turning point came when I took redundancy to write full-time. It was a handsome settlement which did push some wolves from the door, but for Reasons my new life didn’t take off as initially planned, I became horribly (and probably clinically) depressed following the breakdown of a friendship, and life was shit. Money squirted in and out – mostly out – of our bank account like water. We had to use credit card cheques and withdraws to make it through the month again. Consequently, it didn’t take long to get back to debt levels we were at before the redundancy settlement. That depressed me more. I felt like a failure. I stopped opening the mail. I wouldn’t answer the phone. It was not a good time.
I got a job, though. Eventually. Plus, despite the uncertain year off, I’d managed to build up some writing contacts during that time and had semi-regular commissions coming in to help bump up my monthly take home. There was a light at the end of the tunnel (even if it didn’t feel that way at the time).
And then M was laid-off.
His redundancy hit us much worse, to be honest. But this time? This time, I was ready for it.
It’s not officially diagnosed, but I have a mild form of OCD. I had OCD back when I didn’t know that OCD was a thing. All the cans in the pantry have to be facing forward, I can’t stand odd numbers on the TV volume, I can’t touch public toilet door handles or put my bare feet down on a hotel carpet blah blah blah. And I’ve realised that when I’m stressed, my OCD gets noticeably worse. So when we became aware that M’s job might not be sustainable, I went into overdrive planning for it; I set up spreadsheets and scenarios and worked out how long his money would last if he was unemployed for X number of weeks, or only took home half a wage for Y number of months. I planned and planned and checked and checked and planned some more. It was like I couldn’t let the clusterfuck of my redundancy happen to us a second time. I had to be in control.
Despite the many, many years of shitty planning, no saving and bad credit choices, I used a combination of budget software packages to monitor our crappiness – Microsoft Money, Quicken, iBank. But it was around here that I was introduced to YNAB by the wonderful Bonnie, and it’s here that my whole approach about money – my whole approach about a lot of things, I guess – changed.
YNAB wasn’t just a software. It was a whole new budgetary concept. Instead of sitting down and writing out your incomings and outgoings (and panicking midway through when you realised the former doesn’t cover the latter), YNAB’s first principal was simple – this is all the money you have right now. What does it have to do before you have money come into your hand again?
It was like someone suddenly turned on the lights for me.
We didn’t know about prioritising. We didn’t budget and put money away for Christmas throughout the year. But suddenly YNAB was reminding me to do these things. Even if I couldn’t put the full monthly amount away for Christmas, I realised that even putting twenty quid away was better than putting away nowt. We stopped using credit cards completely. We cut down on Christmas and birthday expenditures (we have a wonderful home, and a beautiful boys- we’d rather spend the day playing board games than going for a meal and that’s the truth). We began to appreciate money and that, in turn, developed into a completely unconscious and involuntary reflex to save rather than spend.
I’m now moving into my third year of YNABing. That means every single penny I’ve spent in the last 25 months has been recorded, noted, and categorised. I can’t tell you, hand on heart, that YNAB is the reason we no longer have any unsecured debt (M’s redundancy package and his ability to go straight into another job was our get-out-of-jail-free-card), but I can tell you, 100%, YNAB is the reason we have not taken out any more debt. YNAB is the reason why I put away money each month for Christmas. It is why I have money put away for my tax return from the very month it falls into my account. It is why I check my bank balances daily, reconcile my online accounts with my YNAB records, and keep all our receipts.
YNAB’s had something of a facelift recently, and has switched from a desktop programme to a monthly cloud-based system (which has really pissed people off, incidentally). The rules I learned two years ago have changed a little, but the sentiment remains the same. And it’s this that I wanted to share: if someone had turned me onto YNAB just a little earlier, if I’d stopped hiding and feeling foolish and stupid and just faced it, I’d like to think that it would’ve helped me. Just like I hope this helps someone.
YNAB has completely and irrevocably changed how I think about, and spend, money and I think if you tried it, it could for you, too. <3