When was the last time you talked to your friends and family about debt? In fact, when was the last time you got real with yourself about debt? It’s just not something that we’re meant to talk about, apparently. Credit card bills, overdraft charges, overdue bill payments, emergency payday loans – there’s s certain shame and embarrassment that comes with admitting that these are the things that keep us up at night, so we tend to keep quiet, smile, and agree to split the dinner bill even though you only had a side salad and tap water. 

But it has to stop. Because the reality is that a recent report by debt charity Step Change said we are walking into a “debt crisis”, with 25 to 34-year-olds being the hardest ones hit by the pandemic. The Women’s Budget Group also found that the over-indebted population is “younger, more likely to be female, have children and live in privately-rented accommodation”. And last year, The Money Charity reported that the average UK household had a £60,720 debt in November 2020. 

Basically: debt is something that affects so many of us, and we still don’t talk about it enough. 

But Clare Seal is helping to break the silence. When Seal – who, it’s worth noting, isn’t a finance professional – realised she had £27,000 credit card debt and a maxed-out £2,000 overdraft, she decided to hold herself to account by anonymously logging her situation on My Frugal Year. She quickly gained tens-of-thousands of followers, with so many women relating to Seal’s story (another surprising truth bomb: the average household credit card debt is £2,133). 

Last year, Seal revealed her identity – another step in breaking the stigma – and published her first book Real Life Money, for readers to wanted to find practical guidance along with the reassurance that they’re not alone. Because, as well as the obvious financial impact debt has on us, the effects it can have on our mental health is just as worrying.

If you relate to Seal’s story, you have to listen to a podcast episode she spoke on in 2020. 

The Walle‪t‬ With Emilie Bellet: How Am I repaying £27k Credit Card Debt? With Claire Seal

Emilie Bellet is the founder of Vestpod, a digital platform and thriving community that financially empowers women. She is also the author of the Amazon bestselling book You’re Not Broke, You’re Pre-Rich. In this episode of her money podcast, The Wallet, Bellet chats to Seal about the emotions involved with debt and what practical steps people can take to feel in control again.

You are not a stupid or bad person for having credit card debt

A lot of people are vulnerable to debt, regardless of job, income and circumstances, and yet we still feel like it’s something that “shouldn’t” happen to us. 

Describing the shame she felt about it, Seal says: “It’s so complex but, for me, I’ve always felt like I was quite ‘bright’. And [debt] feels like a very silly thing that I’ve allowed to happen. But I think that a lot of people feel like that: they’re hard workers and switched on, and still, people have found themselves in this position. 

“Relatives didn’t really know about it, and they’ve had to help out in the past, so that was another element – if you’re a grownup with children [Seal is a mother of two] then you shouldn’t really be relying on family for financial help. I’m 30 now, I was 20 when I started the account, I definitely felt like, as a grownup, I probably should have had all this sorted out.”

There are SO many things that affect your spending habits and financial decisions

“In order to fix things you have to take a look at what went wrong in the first place,” Seal explains. “That’s been a big part of my last year: looking at the decisions behind the situation that I found myself in.

“It’s a number of different things. I grew up between two households that had very different attitudes towards money, so I think that was a contributor. There also isn’t much education about finance at school in the UK, which is something that really needs to change. 

“But some of it is to do with my natural character: I don’t think I ever really felt like money was that important while I was growing up, so I was a bit careless to begin with. And then there’s definitely been emotional spending: if something feels out of my control, my first instinct seems to be, ‘What can I buy to fix this?’ It’s still my number one instinct but now I know how to counteract it.”

Sit down, go through your finances and be kind to yourself

The key to taking back control of finances, according to Seal, is to work out what approach suits you best: “I did it over the course of a couple of weeks. I opened everything. I looked at all my balances and started building a budget spreadsheet, which I still tweak now, depending on my situation… 

“I know that for some people, the ‘ripping off the band aid’ approach is what really works for them, but I had to be gentler with myself. I think a lot of this is about knowing your own self and your character.”

Take the first big step by taking a deep breath and speaking to your bank

Seal’s journey really started when she first spoke to one of her banks: “It was the catalyst for all of this. I was into an unarranged overdraft and I had to say to them, ‘I’m not going to be able to get out of this until the end of the month… It was a daily charge of £5 a day up to £80. The woman I spoke to was really kind and she said they can refund bank charges from the last year, and that took me just into an arranged overdraft. During this conversation, I was just about holding it together and when I got off the phone I thought, ‘This has to be the moment where things change’.

She adds: “She offered a referral to debt charity Step Change, who do absolutely brilliant work, If anyone really is at a point where they can’t see a way forward, I would fully recommend them. I’ve heard some brilliant stories of how they’ve helped people.”

Debt won’t disappear overnight, but taking some control will make you will feel better

“I still get quite emotional about money,” says Seal, who is still paying back credit card debts. “Most people do: whether it’s feeling happy when an invoice is paid, or completely rubbish about the fact you’ve overspent.

“I have a diagnosed anxiety disorder, and that’s something I chose to get help with around the same time all of this happened. And I think it’s worth making the point that it doesn’t all feel wonderful when you start working things out, but it does start to feel better. You feel more in control. It’s a healing process and it is painful at times. If you need to look for any external support with anxiety, I would really recommend looking at the resources available to you, such as the mental health charity Mind. 

“There are a lot of things you can do to look after your anxiety during the process too. For me, writing it down was the number one thing. We’re encouraged to write it all down and keep a spreadsheet but not very often are you encouraged to write down how you feel alongside that. And I think if we wrote a journal for our whole lives, jotting down how we felt along with our spending habits, we’d very clearly see a pattern.”

You can listen to Clare Seal speaking on The Wallet podcast on Apple Podcasts.

Speak to a Financial Conduct Authority registered financial adviser before taking financial advice, and think carefully before making any decision.

If you’re concerned about debt, please get in touch with Step Change. If you’re worried about your mental health, you can contact Mind or Samaritans. 

Images: Getty, BOOK PUBLISHER