I have a confession: I am a personal finance expert and I’m currently £44,000 in debt – and not for the first time either.
It doesn’t look great and being a single, divorced mum undoubtedly makes it harder to get out of.
The fact is, I’m an emotional spender and, in the past, have been guilty of what you might call ‘keeping up with the Joneses’ behaviour – a habit I developed when I was a corporate high-flyer. But now I’m determined that on my 50th birthday, in a year’s time, I will be debt-free.
The emotional part of my spending dates from my teens. I was 16 when my mum died, followed by my dad when I was 19, both from heart attacks.
Having been in therapy since the age of 20, I know now that this trauma triggered my unhealthy relationship with money. By the end of university, I also knew how important it was to achieve financial independence.
‘When I received my first bonus of £1,000, I went straight to Louis Vuitton and bought a wallet. It was a sign of things to come’ (Posed by model)
In 1999, I joined HSBC as a finance analyst, earning a £25,000 salary. But when I received my first bonus of £1,000, I went straight to Louis Vuitton and bought a wallet. It was a sign of things to come.
Still, I was doing well and climbing the corporate ladder. By the age of 34, I was on £75,000 working for mobile network operator EE.
Four years later, in 2015, I decided to leave my corporate career to focus on my own project – Mrs Mummypenny, a website which offers financial advice. By then, I was married and had three sons.
When I left EE with a £40,000 redundancy payout, I went to Prada and spent £1,200 on a leather bag. That money was supposed to last me two years, but 18 months later it was gone.
After that, with my business not yet in profit, the debt mounted. I did some daft things like blowing £5,000 on a holiday to Vegas. Before I knew it, I was £16,000 in debt and had to cut back to start reeling it in. Thankfully, not long after, Mrs Mummypenny started to fly. By 2017, I’d paid all the debt off and was earning a six-figure sum.
‘Losing my family as a teen was the ultimate abandonment and buying nice things has always been like a comforting hug,’ writes Lynn Beattie
But you have to keep the momentum going. If your engagement with your online followers dwindles, then the income stream falls and that’s what happened to me.
By 2024, with my marriage over, the debt started to build up again as my bills became higher than my earnings and I had to rely on credit cards to pay them. Here I am today owing £44,000.
Of course, people are going to ask, ‘Why didn’t you learn from your mistakes?’ It’s a fair question, but I don’t think you can judge until you’ve walked in somebody’s shoes. Losing my family as a teen was the ultimate abandonment and buying nice things has always been like a comforting hug.
Today, my monthly expenses are £5,000 – and £1,500 of that is going on debt repayment. I also owe £19,000 on a personal loan which I took to help with cash flow, £3,000 on a credit card, and another chunk to a friend who helped me out.
I have a type of debt that is typically middle class in that I’m employed, own a home – in Hertfordshire, worth £600,000 with £330,000 equity – and have a comfortable pension pot. But because I now don’t earn enough, I can’t borrow against the house or move my mortgage to a better deal.
‘I have a type of debt that is typically middle class in that I’m employed, own a home – in Hertfordshire, worth £600,000 with £330,000 equity – and have a comfortable pension pot’
I’ve already saved £300 a month making small tweaks. I’ve switched the food shop from Tesco to Aldi, joined a cheaper gym and moved all the family phones to sim-only deals. When my water company tried to whack up my monthly direct debit, I disputed it and they reduced it.
My big focus now is on increasing my income. As for my designer bags, I’ve sold half of them on Vinted, although I did recently buy another one on the site – a 2002 Prada for £200 which is worth at least £600, so that was a good financial decision!
I will get my head clear of the debt – and I absolutely guarantee I won’t be here again. Here’s what I’m doing to take stock and cut back:
WRITE IT DOWN To help me face up to my financial situation, I’ve made a list of everything I owe, including the interest rate being charged. The list is on my fridge where I can see it.
PRIORITISE The highest interest debt (usually credit cards) should be the one you repay first. If you have a big credit card balance, see if a 0 per cent balance transfer onto a new card is feasible.
HAGGLE Scrutinise your essential direct debits: utilities, mobile phone, insurance and broadband. I called each company to negotiate a better deal.
BE FORENSIC I write down everything I spend and study it. That way I can see where I’m slipping up and act.
PRESS PAUSE When I shop online, I put things in my basket and leave them there for 24 hours before checking out. I almost always change my mind.
RESIST TEMPTATION Don’t be tempted by instalment plans like Klarna. If you can’t afford it there and then, don’t buy.
SAVE SMALL If possible, have a small emergency fund so that if something goes wrong – the washing machine dies, for example – you can buy a replacement without resorting to credit cards.
See Lynn’s blog at Mrsmummypenny.co.uk and follow her on Instagram @mrsmummypennyuk
