AS a money blogger helping people to clean up their finances, Lynn James was embarrassed by her own £16,000 worth of credit card debt.
There was a time when the mum-of-three couldn’t even afford to buy a coffee – but in just two years she’s managed to pay off every penny.
4 Lynn James, 42, cut up her cards and threw them in the bin after clearing her balancesCredit: Rick Findler
Credit cards were her downfall.
The full-time blogger, from Knebworth, got her first card aged just 18.
But now, aged 42, she’s cut them all up and thrown them in the bin after clearing her balances.
Her road to a debt-free life wasn’t easy. A few spending mistakes saw her going backwards and at times, she ended up in more debt.
“I was hiding from my debt for months,” Lynn said.
“I’m still embarrassed to admit it.
“I write about personal finance so I should be an expert, I shouldn’t have any debt.”
4 Lynn pictured at home with her sons Josh, 9, Jack, 5 and Dylan, 11Credit: Rick Findler
She added: “I felt very trapped by it. At the beginning, I just didn’t know what to do.”
Lynn says her problems started when she was made redundant in the summer of 2015 from a high-flying City job at mobile network EE, where she made £70,000 a year.
For 18 months, she lived off her redundancy payout of £40,000 as she set up her own business – a now-successful financial blog called Mrs Mummy Penny.
But used to a high-paying salary, Lynn continued to spend on luxuries such as Ted Baker clothes, designer make-up, and family holidays – including a trip to flashy Las Vegas.
Her blog didn’t make as much money as she thought it would, and by May 2017, she had racked up £16,000 of debt on four credit cards.
Her first step was to sit down with a friend, another personal finance writer, who helped her go through her bills.
4 Lynn wants to share her story to help others who are trapped in debtCredit: Rick Findler
Seeking help from friends and debt charities is her top advice for anyone struggling to pay off debt.
First, Lynn saved hundreds on household bills by shopping around to get the best deals.
She also shifted her debt onto zero per cent balance transfer cards.
The mum stopped shopping at designer stores and switched from Tesco to Aldi for groceries.
A self-confessed make up addict, Lynn vowed not to buy any new make-up or clothes for a year.
When she did, she no longer bought designer items and only shopped at H&M for clothes.
“I set myself a challenge to do “no spend” months”
Lynn also challenged herself to a few “no-spend” months where she wouldn’t buy anything that wasn’t food, giving up drinks at coffee shops and other luxuries.
It was no walk in the park.
She remembered: “It was a huge sacrifice – and it was awful.
Lynn’s top tips for paying off your debtsHERE Lynn James shares her advice on how to clean up your finances:
Face your fears and add up your debts. Find copies of the latest paperwork or give the card and loan companies a call for balance and interest rates. The first step is accepting how much you have and facing what has to be repaid.
If your debt is unmanageable, then seek help from a free organisation such as Step Change, CAP or Citizens Advice Bureau.
Restructure your debt if your credit rating allows. Move any high interest chargeable debt to a 0 per cent deal. Do what you can to minimise the interest payments.
Focus on your monthly spending budget. List everything you spend onto paper or a spreadsheet or use an app like Yolt.
Optimise every direct debit monthly bill. Get the best deals for mortgage, energy, broadband, mobile phone, TV package. Cancel all non-essential direct debits, sky sports, charity donations, and savings for the children.
Have a no spend month. No lunches out, coffees, or drinks with mates – only groceries and commuting to work is allowed. Make a takeaway a treat every two weeks and home cook instead.
Switch your supermarket shop to a discount supermarket, such as Aldi.
Do a no make-up spend year or a no clothes buying year and re-use all the stuff you already have at home.
Increase your income with side hustles. Get a second job in the evenings, or sell the clutter from your home that you don’t use on eBay or Facebook. Go mystery shopping, a personal favourite which earns me an extra £50 per month. Pro Insight is a good mystery shopping company.
Come up with a goal of when you want to pay off that debt. Be that two years, three years or five years. Be realistic.
Set up a repayment direct debit that you can afford, try to make it more than the minimum payment.
Pay off the debt with an interest charges first. Even if you’ve only earned £10 extra this month, pay it into the debt.
Pay into an emergency fund. I did 50/50 payments until my emergency reached around £3k, a number that I felt comfortable with. It gave me peace of mind. You can then dip into this for emergencies, not the credit cards.
Be prepared for the ups and downs and for it being tough mentally. You will miss out on things, such as holidays with your friends or family. But it’s worth it in the long run to be debt free.
“When you’re used to living a certain way and have to change your life, you just think: ‘Why have I got myself into this situation?’
“But the only way to get out of it is to be ridiculously frugal for a period of time.”
In summer 2017, her income, which varies from month to month, dropped to zero as work dried up.
She struggled to save because any spare money had gone into clearing debt, so she had no money to fall back on over the summer months.
Again she ended up spending more on credit cards, racking up more debt.
Other the next year she worked hard to clear the debt and got it down to just £5,000 in April 2018.
But the same thing happened in summer 2018 as it had the previous year and her debt climbed back up to £10,000.
She had also maxed out her overdrafts of all current accounts, a total of £4,500.
Lynn said one of her biggest regrets during that period was spending £3,500 on credit for a family holiday to Center Parcs.
She had landed a job on TV to talk about last-minute holidays – but needed to book a holiday to go on the show.
The money she made from the appearance didn’t cover what she spent on the trip, leaving her in more debt.
Lynn said: “I met my best friend shortly afterwards who said to me: ‘Let me take you out for dinner, because you can’t afford it, can you?’
“I remember sitting there with a glass of wine, saying: ‘I just don’t know what I’m going to do.'”
Balance transfer cards: what you need to knowSHIFTING your balance can be a great way to cut the cost of your debt. But you must use them properly so you don’t just add to it.Always clear your debt – Credit card firms don’t offer these deals out of the goodness of their hearts. They rely on you not clearing your balance by the time the 0 per cent deal comes to an end so it can start charging you interest.
Always make your payments – If you don’t keep up with your monthly payments, you could lose the 0 per cent offer and start being charged interest. Always try and pay-off more than the minimum payment too to clear your debt quicker and don’t spend on the card either.
Check your deal – Like with all credit cards, you might not be offered the headline deal if you don’t have the best credit history. Use MoneySavingExpert’s eligibility calculator to see what deals you are likely to be accepted for.
After this, Lynn got into better paying work and was able to clear between £250 and £1,000 a month depending on how much she’d earned.
Throughout her debt journey, she said she occasionally struggled with her mental health, especially during winter months.
“I couldn’t get my head around how long it would take to pay the debt back”
Lynn suffers from Seasonal Affective Disorder (SAD) which means from November until January, she has depressive episodes.
“You can’t see any light at the end of the tunnel,” she said.
“When you’re in £16,000 of debt and paying £250 a month is the minimum, and you work out how many months take to pay that…
“I just couldn’t get my head around how long it was taking to pay that debt back.”
Lynn was honest from the start about her tight budget with her kids, Dylan, 11, Josh, nine, and Jack, six.
4 Lynn said she was honest with her three sons Dylan, 11, Jack, 6 and Josh, 9 about her tight budgetCredit: Lynn James
She said they’ve now learned the value of money, and understand when she can’t buy them the £200 pair of football boots they ask for.
Even when the mum was scrimping, she still found ways to treat her three children by blagging discounted cinema passes and taking them to picnics in the park instead of meals out at restaurants.
Last month, Lynn made her final £1,000 payment to clear the balance on her last credit card.
Without the burden of credit card repayments, Lynn now has enough spare cash to go on holiday and cover all her bills.
She’s even treated herself to a new smart watch and a Las Vegas holiday – but said she’s careful not to slip back into old spending habits.
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She now writes out what she spends everyday in a notepad so she can reflect on what’s she paid for to avoid emotional spending.
She said: “I knew I had the money in place, but I was too scared to do it, I don’t know why.”
She continued: “It’s freedom. That’s the best way to explain it.
“I don’t have £1,000 a month to put into that debt anymore and I don’t have to worry about minimum payments.
“And oh my gosh, I have £1,000 spare each month after spending my entire adult life in credit card debt.
“It’s an amazing feeling.”
Martin Lewis’ warns to shift debt now before top zero percent credit cards are pulled
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