Jackie Annett, 43, racked up thousands of pounds worth of debt in her twenties, thanks in large part to her and her ex-husband’s love of socialising and eating out in trendy bars and restaurants.
Soon, the blogger and consultant, who is a single parent to daughter Daisy, 13, knew she needed to make a drastic change.
In the space of just two years, Jackie managed to pay off £16,000 of debt – and now she’s sharing her tips to help others do the same.
‘In my late 20s, my ex-husband and I were in £16,000 worth of debt,’ said Jackie, from Bristol.
‘By day, I worked as the deputy editor on a magazine in London which paid well, but rent and living expenses were high.
‘I also had a penchant for partying and enjoyed eating out in the trendy bars in Hoxton or Shoreditch.”
‘I’d maxed out my overdraft, loans and numerous credit and store cards.’
Jackie was oblivious to just how much debt she was in until she discovered she was pregnant in 2006.
The mum said: ‘At the time, I was eligible for £100 a week maternity pay and I just remember thinking “how the hell will we manage?”.
‘The first time I had a proper look at our debts I burst into tears. But I picked myself up, looked closer at our incomings and outgoings and came up with a plan to pay it off.’
Jackie began to set aside £500 a month, and she and her now ex-husband, who is in the army, cut down on socialising and moved out of the city.
The mum also stopped buying new clothes and created a budget planner in an effort to spend as little as possible.
Thanks to these simple lifestyle changes, Jackie, who now runs a website called Broke in Bristol (& Beyond), helping others to pay off their loans, is now debt-free.
Below, she shares her essential steps to doing the same.
Take an honest look at your finances
Stop pretending everything’s fine, or that you can afford to live above your means. It’s not and you can’t.
Jackie recommends sitting down and making a list of your debts and income, including looking at your bills, credit reports, and credit score to get a more honest picture of your financial situation.
Jackie said: ‘Honestly, you’d be surprised just how many people think that they just don’t earn enough and that’s why they’re in debt until they complete this step.
‘I was so shocked to see in black and white that I had money left over but I was spending it on the wrong things.’
Create a budget
Yes, it’s a bit of faff to start with, but you need to make a budget.
Jackie says that by doing this, she realised where she was bleeding money – and made her plan to pay off £500 a monthly by cutting out luxurious such as restaurant visits and new clothes.
Lower your interest rates
If your credit score isn’t too bad, you might be able to get a credit card with a 0% balance transfer fee and move your debt onto it – to avoid racking up more charges in interest.
Jackie added: ‘Or you might be accepted for a low-cost loan. Pay off the debt with the higher interest first.’
Pay off more than you have to
Don’t just do the minimum repayments. When you can, pay off as much debt as possible.
Do a direct debit detox
Take a look at your subscriptions and cut the ones you don’t need. Plus, call up the ones you want to keep and see if you could get them cheaper.
‘You might be able to save £100 a month, which could be directed towards your debts,’ said Jackie.
Declutter and sell your stuff
Look around your home for items that you no longer use and sell them.
Jackie notes: ‘The odd extra tenner could be put towards a cheap treat to reward yourself every now and then for paying off big chunks of debt.’
Make money from any assets you have
Jackie said: ‘In the past, I’ve earned money from renting out a room, my parking space and my campervan.
‘Don’t have a spare room or vehicle, how about loft or garage space? You can earn around £300 a month via Stashbee [an online marketplace].’
Jackie says that getting out of debt has lifted a huge weight from her shoulders, and wants to help others do the same.
The mum added: ‘I certainly didn’t want to go back to the days of feeling sick to the stomach every time I tried to pay for something with my debit card.
‘I made a promise to myself to never get into debt again and I’ve stuck to it.’
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