Back from the brink of financial oblivion

I heard a story last week that’s too good not to share.

I was on Zoom talking to a subscriber to The Escape Manual. He told me how he’d pulled off a massive 180 degree turnaround: going from debt disaster to responsible role model and provider for his children.

So I asked James (names changed for obvious reasons) if he would jot down his story so I could share it and he kindly said yes.


The Escape Artist

My heart sank as I saw the brown envelope resting on the doormat. 

Brown-official-looking-envelopes mustn’t be ignored.

Hiding away, I nervously read the letter.  “You have 7 days to pay the debt or bailiffs will be appointed to remove goods from your property” threatened the court.

Filled with panic and anxiety, and knowing that I had no means to pay the debt, my blood drained away and my heart pounded in fear. 

How did I get into this mess?

Back to the beginning

Rewind five years.  I have a well paid job and no bad debt.  I’d been brought up to avoid debt.  My money blueprint was instilled by my parents, who rose from the working classes to own a successful business which allowed them to send my siblings and I to university and for them to own a large house and a buy-to-let property outright.

My parents were frugal, only buying necessities and always paying in cash.  Money wasn’t talked about openly, however whenever the occasion arrived, they would warn me of the pitfalls of using credit cards and buy-now-pay-later scams schemes. 

When I was in primary school they got me to add up on a calculator the buy now price and the monthly payment price of items in the Christmas catalogue I had earmarked and compare the difference.  That taught me the impact of interest. 

Initially I followed my parent’s teachings.  But I found it wasn’t easy being the sole earner, financially responsible for supporting my partner and our toddler.

Different money blueprints

Speaking of my partner, she had a very different money blueprint having come from a working class broken family.  Her mother had five children with three fathers, none of whom were around, and she lived off benefits.  If her mother had any money it was spent on fags, booze or drugs. 

As soon as my partner could legally get into debt, she got into debt.  Defaulting on any credit given to her.  During my early twenties we got pregnant.  I had to grow up rapidly and start a career, buy a house, move in together, grow our relationship, become a father and reconcile our money blueprints.  It was a challenging few years!

Keeping up with The Joneses

I coped until things got away from me.  We moved house to an expensive area, made friends with the Jones and had a second child.  Holidays, new hobbies and keeping up with said Jones caused our expenses to rocket. 

I was promoted into management and felt like I could afford the lifestyle, but the extra income wasn’t enough to cover the increased outgoings.  Relationship growing pains and work stress compounded the problem and my mental state deteriorated.

Out of control

Over the next two years our finances rapidly spun out of control to the point I had no idea how much was coming in and out of my account.  Before long I had an overdraft, two credit cards, two loans and a second mortgage – amounting to £50k of bad debt. WTF!

Credit sources dried up and the debts caught up with us.  We cut back and juggled the debts (and crippling interest repayments) as best as we could, borrowing from Peter to pay Paul.


I hid the issues from my parents and friends and made excuses why I couldn’t make expensive social occasions.  I hid the issue from myself.  Ignoring letters and sticking my head in the sand.  I stopped answering the phone.  I felt ashamed, anxious and stressed whenever I thought of the debts, or received one of the relentless letters or harassment phone calls demanding payment. 

I tried a debt management plan, but it didn’t work for me.  Eventually I cracked and took the painful decision to default on the credit cards and loans.  I didn’t care about the impact on my credit score of defaulting, I was sick of credit and needed to be cut off like a junkie.

Fortunately my partner was supportive, even though it wasn’t her fault that I was in this mess, it was mine.  I was in charge of the family finances and I had lost control.  She didn’t force me to spend. Had I said we couldn’t afford something she would have been disappointed but she would have understood. She didn’t judge me for my failings.  Maybe it was because she had grown up in such a poor financial environment that she knew what it was like to live poor and knew that we would be okay.

Facing reality

Having no available credit forced us to relearn how to live within our means.  I kept a close eye on the accounts.  My partner and I talked more openly about money and what we could or couldn’t afford.  Months passed and I felt better that I had regained a small level of financial control. I wasn’t ready to fully remove my head from the sand.  I continued to ignore letters (especially those in white envelopes) and calls until one day the letter in the brown-official-looking-envelope arrived menacingly.

I realised how much of an absolute cock womble I had been and that I had to face up to my debts.  I negotiated with the court and the creditor a repayment plan which would keep the bailiffs from knocking.  I felt confident I could meet the payment commitments after living without credit for over a year. 

I got hold of my credit reports (freely available), took a deep breath and surveyed the damage.  All of the debts were listed, albeit with different company names where the debts had been sold on, along with a couple of county court judgements.  The debts were no longer accruing interest, so that was one positive to take away.

Back to basics

I researched personal finance and stumbled upon The Escape Artist and the concepts of FI.  Bingo!  This blog told it straight, it resonated.  I devoured the blog along with others and listened to days worth of financial podcasts. 

I was living within my means but realised that I had no financial plan to deal with the debts or to cater for the future.  So I created a cunning plan to (1) establish an emergency fund, (2) become debt free with an improved credit report and (3) to set myself on the path of FI. 

I shared the high level concepts of the plan with my partner (not the detailed spreadsheet as that’s not her thing), and that the outcome would be that one day we wouldn’t have to worry as much about money and that we could retire way before most people and spend our time how we choose.  She got onboard with the plan.  She values experiences and spending meaningful time together over needless consumerism so it was a good fit.

It’s been two years since I received the letter from the court and I started to get my shit together.  I took out a second bank account with Starling (no overdraft) so that I could separate bills from living expenditure.  The account increased my financial control by providing instant spend notifications and provided a facility to segment money into buckets for different purposes such as debt repayments, sink funds and weekly living expenditure.

What gets measured, gets managed

I created / adapted / stole a marvelous spreadsheet to track my finances.  I used aggregator apps (e.g. Emma, Yolt, MoneyDashboard, Moneyhub) to monitor my accounts holistically.

With laser focus, we found ways to reduce expenses and to increase income.  Nothing revolutionary, lots of small improvements combined to provide breakout money.  Using which we have paid off large chunks of debt, saved for a (small) emergency and invested for our future. 

Since the debts were incurring no interest and we felt reasonably secure in my employment – we have done all three in parallel.  We have saved one+ month of emergency fund, paid off or settled (read specialist debt forums for how to do this) 75% of the debt and increased pension contributions.  Within the next two years we are on track to become bad debt free and have three+ months of emergency funds saved.  My credit report is improving, defaults and CCJs drop off after 6 years.  Within the next 15-20 years, we aim to reach FI with a 7 figure investment pot.

You can do it

This is how I came to the brink of financial oblivion and how I am finding, or stumbling, my way back.  I hope by reading this you can avoid getting into the mess I did, and if you are already in a mess, you take comfort knowing that you can dig your way out.

Looking back, I found it startling how quickly things soured. Over 18 months I did serious damage.  Damage which takes significantly longer to repair.  I attribute the root cause to a lack of financial control brought upon by a highly stressful period in my life.

Many people spend their 20s building a career and learning how to be an independent adult.  I skipped that and went straight into buying a house and starting a family.  Although I had an idea of what I should be doing from my financial blueprint, I was missing the knowledge of how to do it.

Lessons learned

I should have sought help sooner when things started to go pear-shaped. Had I done that, things may not have become so bad and I could have recovered easier.  It’s hard seeking help when you have your head in the sand.  I should have manned up and taken responsibility. 

I have learnt an enormous amount from the experience and it led me to discover FI concepts, and for that I am grateful. 

I try to pass on what I have learnt to my kids.  I explain how to get rich by saving over a long period and letting compound interest do its magic.  They know not to buy the latest trend as it is a waste of money.  They see the threat of adverts.  They compete to see who can save the most in their Junior ISAs.  As they get older I will teach them the ‘how’.  How to create and run a budget, how to invest and importantly, what to do if they get into trouble.

Image credit: Business vector created by macrovector_official –


  1. I’m adding ‘cock womble’ to my glossary of financial jargon

  2. Good story. Keeping up with the Joneses is an insidious trap. It was well understood by one of the original FIers in 4th century BC Athens. Epicurus built his ‘school’ The Garden outside the walls of the city to escape the Athenian Joneses and keep his students focused on new lentil recipes. It’s hard being different from your neighbours and more so for kids who have to deal with comparisons all the time at school. So it’s great to see you supporting their different approach to money. They might end up being a role models for others too as you’re being for them. And Epicurus can be for all of us.

  3. Interesting story. 50k debt is bad, but without knowing OP’s annual income it doesn’t say much.

  4. ladyaurora · · Reply

    Phew! Well done you.
    Glad it’s out there now ,its sure to help others.
    When you focus it’s amazing what you can achieve.

  5. Awesome story! I’m glad he let you share it. Seeing people in desperate financial trouble realize they are capable of making a change is always incredible to witness.

    Keep it up!

  6. […] Back from the brink of financial oblivion (the escape artist); interesting interview where someone did a lot of work to repair his life. […]

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