A WOMAN who wiped out £60,000 of debt in five years swears by three tips that have helped her get her finances back on track.
Dr. Nikki Ramskill took out her first credit card at 18 before starting medical school – and her bank balance went into debt.
Through loans, overdrafts, a high tax cost, and the credit card bill, she quickly accumulated money that she would need to pay back.
But when she decided to take the time to travel to Australia, New Zealand and Thailand, a five-month break made her realize just how bad things had gotten, the Mirror reported.
Nikki, who is now 37 and lives in Milton Keynes, began to panic trying to pay her bills and trips after realizing there was no money coming in.
Soon, the unhappiness and sadness of being a few bad decisions away from the real issues that prompted her to change her ways.
She said: “That’s when I thought ‘oh my god, this is terrible’. I was down on a chance of a trip of a lifetime that I may never take again .”
When she returned to the UK aged 31, she pledged to do the work to get by – but found it was harder to get out of debt once you were already starting to look like a bad investment from the bank’s point of view.
Zero percent balance transfer credit cards were no longer an option as his credit rating had begun to plummet.
She adopted the snowball method – repaying the smaller of the unpaid and owed amounts first.
Most read in The Scottish Sun
Nikki found that when she cleared a debt, it motivated her to move on to the next highest sum.
But after taking a pay cut, she still struggles to make it all work.
After accessing all of her options, Nikki opted to take out a debt consolidation loan to streamline her debts into one monthly payment.
She said: “I cut up all my credit cards and didn’t use them because I didn’t trust myself. I had to go cold turkey.”
“The good thing was that it cut my payments in half. The other good thing was that the interest rates I was paying were much lower.”
Over five years, Nikki – who now runs The Female Money Doctor – was able to pay off the £60,000 while earning around £2,600 a month.
She credits the snowball method with around £10,000, £40,000 through the consolidation loan and she inherited £10,000 after losing her father.
Although a debt consolidation loan was the right move for Nikki, she admits she was “lucky” to be able to agree on good rates with the bank manager.
She said: “Some debt consolidation loans will be secured by your home, so if you miss payments your home could be at risk. Debt counselors would never suggest taking out a secured loan to pay off unsecured debt.
“You should also check the termination fee for an existing loan agreement – and if there are any prepayment charges. This may not be an option at all if you have a bad credit history. “
For anyone struggling with money, Nikki has three key tips.
She says to tell someone as soon as possible, talk to a debt counselor for free, and make a decision on how to get help and come up with a plan quickly.