My debt story

by Kylie on July 30, 2012

There have been times in my life where I struggled with debt. 2 times in particular really stand out, when I was not in control of my money or my spending habits. I am not proud of those times, but I did learn from them.

The first time was when I had a credit card debt. I was struggling to pay it off, then fell pregnant. In Australia you get a government grant, “the baby bonus” when you have  a child. At the time it was just over $4,000. Once I found out I was pregnant I figured I could keep trying to pay off the card, but even if I didn’t fully get it paid off, I would have the baby bonus to cover it and at the same time I was due, we would be getting back our tax returns, so the debt would be no problem. I owed less than the baby bonus anyway.

Then I had complications in my pregnancy causing me to have to really cut back on work. I had my own mobile hairdressing business. If I didn’t work, I didn’t make money, so my income dropped, making the debt harder.

Next my nieces moved in with us. This was not a problem, except they came with virtually nothing, so my debt went up when I bought clothes and things. Also, all our bills increased because we had 2 extra people living with us. After them living with us for a bit I was able to claim Family Tax Benefits, but was unable to do this when they first came for various reasons.

At this time my sister was living with us and paying board which helped, but did not cover what I was losing from not working.

So with a lot going on, I just relied on the Baby Bonus to be able to pay off the debt, and it did. The problem is, I didn’t really change my habits. I did clear the debt and got rid of the card, but my thoughts and desires surrounding spending/getting what I wanted had not changed. This card had been in my name only and my husband didn’t see the statements or anything, so he was pretty unaware. I was the one who did all the finances, so it wasn’t really his problem. He knew I had it, but not what I spent on it.

Fast forward a few months and my nieces were living with my mother in law, we moved to Canberra and I finished up my business. We had our house which was being rented out and were renting elsewhere. My husband worked in a job he hated, I hate the unit we were living in and felt I deserved better.

It was about this time a relative was doing more work with jewellery – nice jewellery like diamonds, rubies and things. I could get top quality items at wholesale prices and pay it off. My husband didn’t even need to know because I had started working, I could pay it from my wage and it wouldn’t matter.

I was so depressed about everything in my life at the time and thought pretty jewellery would make me feel better.

It didn’t.

Instead, I felt guilty because I had a large debt that my husband didn’t know about. We were struggling with money and here I am buying jewellery for myself when there were so many other things we needed.

Then he found out.

I lost his trust.

How could I have done this? I had mishandled our money. Essentially, I had stolen from my husband and our daughter. I had lied to a close relative saying I could afford it and it was fine. I couldn’t and shouldn’t have bought them.

We cancelled what we could from my jewellery debt, but since some items had been special ordered, I couldn’t cancel them. I still wear these pieces, but still feel pangs of guilt every now and then.

It was stupid. It was a combination of depression and a sense of not wanting to miss out.

I look at how much those debts cost me and never want to be in that sort of situation again. I currently live debt free except for my mortgage, but that should be off my hands soon too.

I did learn from these experiences though and thankfully now have control of my finances and spending habits. It cost me a lot and I never want to be in that sort of place again.

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{ 3 comments… read them below or add one }

Marie at FamilyMoneyValues July 30, 2012 at 11:42 pm

Sometimes what we learn through our mistakes turns out to be the best thing that happens to us – if you take the lessons to heart and do something with them. Sounds like you will.
Marie at FamilyMoneyValues recently posted..Millionaire Story – Marissa Mayer CEO YahooMy Profile

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Tackling Our Debt July 31, 2012 at 4:15 am

You really encountered some struggles for a while but it is good that your purchases are out in the open and I know from hearing your podcast last week that you are already moving forward financially.
Tackling Our Debt recently posted..Finding a Balance Between Your Work and Personal TimeMy Profile

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Amy Turner August 12, 2012 at 9:55 pm

All’s well that ends well. I am very happy to know you have risen from that situation and your story is worth repeating to those with similar problems. If you can do it, surely those of us facing debt struggles can also find the heart to stop and reverse the situation. Thank you for sharing your success with us.
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