The Confessions of a Personal Finance Blogger
I am well known for my honesty in the blogging world. I am specifically chosen for brand campaigns for my authenticity and real life relatable stories. The posts that always perform best are the ones where I admit my flaws and talk about how they happened and how I am going to try to fix them.
I have written about my financial mistakes, my mental health struggles, my weight issues. I have talked about the truth of being a parent, the reality of being a business owner, the death of my parents and my health issues. No holds barred.
Until it came to my debt. I am not shy to talk about this with my friends. I really want them to know why I have had to say no to a 40th New York holiday this year or centre parks last year or why I might suggest a dinner at a friend’s house rather than go out for food. My friends know that I am still in the early stages of a new business and they know I have credit card debt. I always have had a balance sitting on an interest-free credit card.
But I have never outwardly expressed it on here, confessions of a personal finance blogger. My blog (my baby!) where I write about all the frugal things I do and money saving ways I live my life. I have always lived my life in a money saving way but where I save on some things I splurge on others (Prada handbags).
I’ve always lived my life in the moment, wanting things now (refer back to the death of my parents, could explain it, I’m no psychologist or anything). Things have always been paid upfront on a credit card/loan and then repaid over time.
I do have some savings. Once upon a time, only 2 years ago, I had £40k in my bank account and just £8k sat on interest-free credit cards. I had just taken redundancy so was rather cash rich. I saw no reason in paying off the credit card debt as it was interest-free. This £8k was the hangover from our house extension where we had overspent.
That 40k burnt a hole in my pocket, the first thing I did was hit Selfridges and bought myself a redundancy present, a Prada handbag. £600 gone.
It was hubby’s 40th birthday so we went on holiday to Las Vegas and New York and spent maybe £4k in the process. Hubby went to Barcelona, to the Belfry for a golf weekend, and we had a £500 lunch for his birthday. We then went to Spain with the family during the summer holidays and spent another £5k!! So, in just a few months that was £12k ish spent.
The remaining money went on living expenses whilst I was growing the business. There was pretty much a whole year with us slowly reducing our living expenses and using up the remaining £28k. In my first year of trading, I made very little money, a few £k. I made some money matched betting and eBaying. By June 2016 the money was gone. I swopped the £8k credit card debt over to a new card with a long interest-free period, adding a bit debt to it from our monthly spending. Suddenly it became £10k.
But then Mrs Mummypenny started earning money, decent money. We had radically reduced our monthly spends from £4500 per month down to £3000 per month in a year. I was able to draw money out of the business and pay towards our monthly bills of £3000. But of course, things happen that means the monthly £3k isn’t just it. Christmas happens, birthdays, car repairs. Another month worth of expenses went onto the credit card.
Then my 40th birthday arrived in March 2017. I had to celebrate that and do something special. Vegas was booked and it went on the credit card. I had a birthday party which cost £500.
Here we are now April 2017, just back from Vegas where I didn’t win enough to repay what was owed. One of my first admin things to catch up on was calling all the credit card companies, getting an up to date balance and timings of when the 0% ends. I needed a total of all the money owed. I also worked out how much money we have and are owed. Thankfully Mrs Mummypenny had a busy Feb & March so I am owed a large chunk of cash.
The debt comes to £15,500.
There you go, the hard-cold number. Pretty big hey. Easily done over a period of time where I was no longer bringing in the £4k per month that I used to earn at EE.
Let’s Rationalise This and Come Up with a Plan
First things first the debt needs to be restructured. Meaning a new 0% card needs to be organised whilst my credit rating (who knows how?) is still 999 on Experian (everyone check it for free here!). I was able to transfer £7,500 (with a hefty 3% fee) over to an MBNA card which is 0% interest-free for 42 months.
This means that I have £1,000 of holiday spends on a Halifax foreign currency card that needs to be repaid now, as interest is payable from 5th May. Check.
I have £1,500 on a business credit card that needs to be paid off as a priority as there are interest charges.
Next is £5,500 on a Virgin credit card which is interest-free until November 2018. I have 18 months to pay that one off.
I am not 100% sure how I am going to deal with all of the above, but I am going to seek help from a couple of personal finance friends who have got themselves out of debt. Every month I will report back on the how in more detail.
The Positives of Money we Have and are Owed
There is good:-) We have money in a shares ISA, some annoying Tesco shares worth 50% of what I paid for them, savings, money owed to my business, money in Mrs Mummypenny accounts. This comes to around £9k. We have 3 months’ worth of household essentials in the bank.
I have re-done our budget again (it’s redone every month currently) and £3k is what we spend each month on mortgage, food, petrol, bills. There are definitely more cut backs to be made within here. I know what can be cut back, it just takes a strict mind to say no to a few things in that budget (sky sports, school dinners, childcare, no convenience co-op shops). I have already managed to change the mortgage and save us £100 per month with the new deal starting from July. The obvious things like energy, broadband, insurance, TV are as low as they can possibly get!
If anyone reading this needs a copy of my budget spreadsheet then please contact me email@example.com.
And Mrs Mummypenny is on the up. My monthly income increased by £1000 per month from Q4 2016 to Q1 2017. Q2 is going to be even bigger as I know what work I have agreed and what money is due to be paid during this quarter. This trend can only continue up.
Hubby left his job two weeks ago, so he needs to get going with starting up his dream business to ensure that we can pay the mortgage beyond 3 months. There a whole other story there, mainly on how to set up a business that requires a capital investment for set-up. And that sometimes you can’t settle for unhappiness you have just got to walk.
The Secret and the Law of Attraction
Both hubby and I have been reading The Secret and The Magic and 100% believe that everything will be okay. Money will come as long as we believe it will. I have faith that very soon Mrs Mummypenny will be bringing in £5k per month. It’s not far off I am telling you!
We are visualising money and have belief it will come. We are practising gratitude and affirmation in bundles. I don’t feel worried about the money owed to others as I know it will be resolved.
So, there you go my reality. I’ll report back soon on how we are doing with manifestation of money and how much we have managed to repay.
If you want to help in any way please share this post, as we all know our family is not the only one in this situation. I will get more traffic, more social media followers, more email subscribers, more FB group members, more people clicking on affiliate links, more people buying my book. And all of this will turn into money.
Thank you for reading.