I cleared £15,000 debt with easy method I wish I’d known about sooner and anyone can do it
SINGLE mum-of-one Stephanie Ward realised she needed to sort out her finances when she found herself choosing which bill to skip paying each month.
Stephanie, 34, from Bedlington, had amassed £15k of debt and was tired of putting her daily expenses on her credit card.
"I sat down and I said to myself, 'I can't keep choosing which bill to skip each month, I need a plan," she told The Sun.
Stephanie had grown up in a household that didn't manage money well.
When she was 19, a family member had asked her to take out a loan on their behalf to get a vehicle fixed because they had a poor credit score.
But they stopped paying her back, leaving her paying £150 for a month on their behalf that she couldn't afford.
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Stephanie was working a job that brought in a small wage, but when she fell pregnant with her son at the age of 21, she found maternity leave a struggle.
Stephanie, whose son is now 12, said: "Maternity pay is really bad and babies cost a lot of money. I was using my credit card to pay for clothes and day-to-day items.
"Along with the loan I'd taken out, things were starting to get out of control."
When Stephanie left her husband, things went from bad to worse.
The mum-of-one started doing some freelance copywriting and proofreading on the side to supplement her wages.
She wasn’t charging very much, but decided she should declare the earnings.
She said: “I registered for self-assessment because I thought I had to. I went to submit it on the deadline on the 31 January but I couldn’t find my UTR number and it took weeks to replace.
“I was fined £1,000 in total, only to find out years later that I never had to register in the first place as it came under a hobbyist income.”
She was also forced to pay back £2,500 in child care costs because she didn't realise she needed to keep her receipts and as she couldn't produce proof of payment she needed to repay.
So how did Stephanie she get herself out of her financial mess?
How Stephanie cleared her debt
Deciding to retake control of her finances, Stephanie joined a money club where she started using the so-called snowball method.
This is where you take on the smallest loan with the highest interest rate and start paying them off one at a time.
Stephanie then joined the Mad About Money app where she found support and community in helping to understand finances and really started to work on bringing her debts down.
She said: “It was the financial education I needed and with that came help and support I didn’t know was out there.”
As a part of her financial overhaul, she opened a Revolut account and within it, she opened new savings pots where she stored money for her day-to-day outgoings - Christmas and birthdays, car maintenance, house maintenance and school uniform.
She said: “In the beginning I might only put £5 in each pot, but it was a start and it was something.
The hard work paid off and Stephanie paid all her debts off in 2019.
Stephanie said: "Every fibre of my being felt lighter. Now I still do the same things.”
“I'm very careful to make sure all my pots have money in them before I give myself anything to use for what I fancy."
Stephanie has ADHD and Autism, which makes it more difficult to manage her money as she is prone to impulse spending.
"For that reason, I can find money really stressful," she added.
When Stephanie got the access and learnt about the things she needed everything seemed clearer and easier to deal with.
Stephanie said: “Money is everything, unfortunately. You can buy all the help you need in the world.”
Becoming an entrepreneur
From her own experience and seeing how other people struggled to find the same information has inspired Stephanie to start her own business The Spice Brain Collective.
It’s aimed at supporting neurodivergent people by giving them the right tools at the right time to be able run their businesses.
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She said: “There are so many barriers to accessing the right information at the right time regardless of ADHD and autism.
“I’ve made it my mission to not only connect people to the right information but give them the ongoing support so they can embrace and utilise the best features of their complex conditions to their advantage.”
How to cut the cost of your debt
IF you're in large amounts of debt it can be really worrying. Here are some tips from Citizens Advice on how you can take action.
Check your bank balance on a regular basis - knowing your spending patterns is the first step to managing your money
Work out your budget - by writing down your income and taking away your essential bills such as food and transport
If you have money left over, plan in advance what else you’ll spend or save. If you don’t, look at ways to cut your costs
Pay off more than the minimum - If you’ve got credit card debts aim to pay off more than the minimum amount on your credit card each month to bring down your bill quicker
Pay your most expensive credit card sooner - If you have more than one credit card and can’t pay them off in full each month, prioritise the most expensive card (the one with the highest interest rate)
Prioritise your debts - If you’ve got several debts and you can’t afford to pay them all it’s important to prioritise them
Your rent, mortgage, council tax and energy bills should be paid first because the consequences can be more serious if you don't pay
Get advice - If you’re struggling to pay your debts month after month it’s important you get advice as soon as possible, before they build up even further
Groups like Citizens Advice and National Debtline can help you prioritise and negotiate with your creditors to offer you more affordable repayment plans.
Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk.