This isn’t to say that I got these traits from my parents, far from it. My parents strived hard to become successful and still save to this day. What I got from my parents was their spending power, their ability to go out and purchase the best…whenever they wanted to. I didn’t see the hard work and saving, just the ease at which they could go out and get whatever they wanted.

Obviously I’m not alone or banks and credit card companies would not be the vibrantly successful entities that they are today. I don’t know why our parents forgot to hand down the skills of saving. Maybe they didn’t forget, maybe we just forgot to listen. Too busy staring at all the shiny things for sale. We’ve walked, wide-eyed, in to the bright lights of the marketers. Who haven’t stopped offering us everything that we could ever want or desire.

For me, that is how it started. A teenage girl who had the tastes and spending habits of a Captain in the Merchant Navy and his Paediatric-Nurse wife… Add to that the birth of the credit card and there was no need to save. The World was my playground and I could pay for it in monthly instalments.

So, fast forward a couple of years. I’ve got a good job but my spending is out-stripping my earnings. I’ve got a young family and reality is starting to bite hard, but I am slowly learning my lesson. As a family we are still running up debts but over the coming years I catch several lucky breaks with the property market and manage to get rid of my debt. I inherit a plot of land and decide to build my own place.

Fast forward to 2009, the house has been built but my luck has run out and the build went way over budget, mainly due to the rapid rise in the property market. The UK property markets then suddenly nose dive and I’ve got a mortgage on a house and plot of land that is now worth exactly what it cost to build. My marriage is failing and I’m struggling to keep my head above water – debts are mounting.

I find some of that British resolve somewhere in me and get all of the debts under control and walk away from my shattered marriage with less than £100 to my name, but making sure that the joint account was £700 in credit.

I then make the biggest School girl errors of my life…I take my eyes off the ball.

What ensued was the divorce from hell, where my ex-husband racked up massive debts in my name.

In short, I had no money and I had debt collection agencies beating a path to my door, calling at all hours and sending threatening letters.

Here in the UK, if you have a lot of credit it will affect your credit rating. If you have a missed payment it will affect your credit rating. If you are self-employed it will affect your credit rating. It is near impossible to get a consolidation loan once your credit rating has been affected. This is not a bad thing – it just means that you have to face everything head on.

I had no money and no way of getting credit – so I needed a way to get everything back under control without getting me further in to debt.

So here is what I did. By the way, I was shown this method by someone who had used it to get rid of massive debts. So I knew from the very beginning that it would work.

Firstly and most importantly, you have to change your perception of debt. It is no longer a taboo subject and you cannot go to jail for being in debt. Debt has become a fact of life – so there is no need in burying your head in the sand, hoping for it to go away.

Next you become organised. You get to the bottom of your income and expenditure and find out exactly where all of your money is going and you write it all down or put it in a spread sheet. You then find out all of the information of the debts you owe. Account numbers, balance, payment schedules, who your creditors are and their contact details.

You then proceed to contact your creditors either by post or via email…Never, never, never contact them over the phone, unless it is to make general enquiries about your account and who to contact. Your financial situation is set down in writing along with your payment plan and is not open for discussion or debate. You also request from that time forward that all communication between you and your creditor and their agencies is by post only. You then finally remind them that it is illegal to harass or threaten you with legal action, especially as you have taken steps to sort out your debt problems and that your payment plan will only be revised WHEN and IF your circumstances change for the better.

So What Do You Offer Your Creditors and Why?

Simple – your income and expenditure sheet will show exactly what you have going in and out. If you are in debt then you will have more going out than coming in.

Never make offers of payment that are unrealistic to keep up.

Never be afraid to offer the bare minimum payment as a token gesture. If you have to offer $1 per month on a $20,000.00 loan then so be it. By doing this you are showing willingness to accept responsibility for your debt and being proactive in dealing with it.

Credit companies hate you doing this and they will then pass your debt on to one of their agencies – you repeat the same process with their agencies.

Remember this one point, if you have been proactive in dealing with your debt, the credit company or their agency has to comply with your plan. No court in the World will ever make you pay monies that you cannot afford. It will rarely go to court (if it does you just send the same papers to the court) and the creditor will begrudgingly leave you alone, as long as you maintain the payment schedule that YOU laid out.

If you ever do mess up – just repeat the same process and lower your payments.

Credit companies can only force repossessions on you if you have not dealt with your debt. They do this by going to court and proving that you are ignoring them. If you’ve dealt with it they cannot go to court. So always deal with it.

Next Part Of The Plan

You can then either maintain your payment schedules for the next five years (the debt has to be written off after 5 years and cannot be forced upon you forever if you do not have the means to pay it) or you can set about paying off one debt at a time by making cost cutting part of your new life style and by using the spare money you were spending on the debts to focus on each debt, one at a time.

Select the debt that either has the highest interest rate (not really relevant - see below) or the highest outstanding debt.

Another point to note – as you’ve told your creditors of your financial situation you can also request that the interest be stopped on your debt. As the debt is going to be passed on to one of their agencies (sold on) the interest will stop and has to stop by law because your original contract was with the credit company and not their agency.

As each debt is repaid you can apply to your credit reference/scoring agency to have that debt removed from your record. This then builds up your credit score again – should you want to do so.

Personally we live free of credit and have returned to the old ways of saving for things that we want.

One final note – some of you may read this and think it is not legal or ethical to get your debts under control in this manner. I can assure you that the law is fully on your side as long as you take action and stick to your plan. However, it is illegal to make false statements about your income and expenditure, so just be brutally honest about it.

I personally do not agree with the corporate identity method of dealing with your debts. I know people have done this and gotten away with it. I also know people who have failed and gone to jail for trying it. In my mind, if you’ve run up a debt, it is yours. Trying to wriggle out of it by claiming that you are not the corporate identity that the debt was issued to is not ethical.

But also ask yourself this: Is it legal or ethical to sell consolidation loans to people who are already in debt? Legal maybe, ethical no! It comes under the guise of racketeering for extortionate credit transactions or profiteering from manipulation of prices. – Just my thoughts!

Personally I would stay clear of buying more debt to get you out of debt…All you are doing here is extending the length of time that you are in debt and paying some middleman a fat sum to keep you in the debt spiral. It also delivers false hope or a false sense of security and allows you to rack-up more debt.

To finish, there is always hope, and the sooner you put a plan together and start acting on it, the sooner everything will start to turn around. Sitting with your head in the sand and bemoaning your lot is not constructive and will only lead to more misery. So, regardless of how you tackle your debt, tackle it.

Accept it, own it, deal with it and get it back under your control. Get back to being happy as quickly as possible.