Debt—it’s something many of us face, but not something we ever really expected to be grappling with. Looking back to when I was 16, I envisioned a future where I’d have my own house, a flashy car, and maybe even be surrounded by glamorous companions. Reality? Well, one out of three isn’t too bad! But seriously, the past decade has seen me slowly but surely falling deeper into debt.

While I’ve always managed to keep everything under control—never missing a payment, avoiding payday loans, and always borrowing within my means—I found myself teetering on the edge. By February 2013, I realized it was time to take action and get my finances in check. It wasn’t easy, and it’s taken the better part of 9 months, but I’m now on the right track.

Step 1: Know What You’re Spending and Where

Budgeting is key. Before I got serious about my debt, I had no idea where my money was going. I couldn’t tell you how much I had for fuel, for the kids, or for anything else. The first step was writing everything down—literally everything—and putting a number to it.

Everyone knows to budget for the basics:

• Water
• Gas
• Electricity
• Food

But many people forget to budget for:

• Car insurance
• Birthdays
• Road tax
• Fuel
• Savings

It’s crucial to account for all these expenses because unexpected costs can throw your budget off if you’re already stretched thin. For example, you might want to spend £20 per child on birthdays and Christmas. If you have two kids, that’s £40 for birthdays and £40 for Christmas—totaling £80. Divide that by 12 months, and you’re looking at just £6.67 per month. Not bad, right? But you have to plan for it.

Step 2: Are You Spending More Than You’re Earning?

Now that you know where your money is going, it’s time to figure out if you’re spending more than you’re earning. A wise neighbor once told me:

“It doesn’t matter what’s coming in; it’s what’s going out that matters.”

It took me a while to grasp this, but he was absolutely right. You could be earning £20 million a year, but if you’re spending £21 million, you’re in trouble.

In my case, I found I was cutting it way too close for comfort. I needed more money to cover my expenses. If you’re earning enough to cover everything but have been splurging a bit too much, tighten the belt and start chipping away at that debt. If not, you’ll need to look at your options.

Step 3: What If You’re Spending More Than You’re Earning?

If you’re spending more than you’re earning, you’re living beyond your means and digging yourself deeper into debt. It might be a small amount each year or a significant sum, but either way, it’s a problem.

Your options are simple: Earn more, spend less, or both (usually the best option). For me, checking my budget helped me identify areas where I could cut back. For example, I realized I was going out when I simply couldn’t afford it.

“If you have to wait until payday to go out, you probably can’t afford to go out.”

After tightening my budget as much as possible, I still felt I didn’t have enough money to live the life I wanted for my kids and myself. So, I decided to get another job. Luckily, I have decent grades and a lot of work experience, so I started handing out CVs and landed a second job. This helped me afford a few more treats for the kids and myself.

I still have a LONG way to go, but I’m finally moving in the right direction.

“It’s better to be crawling in the right direction than running in the wrong one.”

Step 4: Debts vs. Savings

There’s an ongoing debate: Should you save, or should you plow everything into paying off debt? For me, the answer was simple. I was fortunate enough to transfer my debt to a 0% interest account, so I made minimum payments and focused on building some savings.

The advantage of having savings is that you can avoid taking on more debt if, for example, your washing machine breaks or your car needs repairs. However, if you’re still relying on credit cards and just making monthly payments, you might be better off focusing on paying down that debt.

Final Thoughts

I hope this information helps you get on the right track. I’m not a financial advisor, so if your debt situation is severe, it’s crucial to seek professional help from free non-profit debt crisis agencies like Citizens Advice Bureau, StepChange Debt Charity, or National Debtline.

Remember, this blog is about sharing tips, tools, and techniques to help dads navigate life’s challenges. I aim to provide the best advice possible, but it’s important to do your own research and tailor your approach to your specific circumstances. And while I may link to other websites, I can’t be responsible for their content.

Stay smart, dads, and keep moving forward.