Sarah J chatted with Katie Clarke

Katie Clarke

With all the current concerns over the credit crunch and with 1 person every 4.5 minutes
declared bankrupt or insolvent (Credit Action), the new Care For The Family book The Sixty Minute Debt Buster is very timely! Sarah J caught up with one of the authors Katie Clarke to get the low down on the book and some tips for saving money!

Sarah began by finding out what motivated Katie to write the book in the first place.

Katie: I'm a lawyer and I've spent a number of years, actually the larger part of my legal career, working in an advice centre where I specialised in dealing with people on a daily basis who were overwhelmed by debt; they just needed some advice and sometimes just to talk through the options available to them. I was really at the sharp end of people's debts. I finished working in the advice centre about a year ago. I just thought I wanted to put into a book, practical advice in a really easy to read accessible form that people would be able to pick up and will help them realise that there are options available to them whatever their situation, however serious it may seem. There are things that can be done. And you know I just wanted people to realise that they're not alone. So that was my heart for writing the book really. Just so that people realise that they're not alone and packed it full of stories of people I've come into contact with - just to help people realise that there is something that can be done and there are other people out there like them and they've come through it.

Sarah: Fantastic stuff. Now it's called 'The Sixty Minute Debt Buster', so in theory I should be able to read the book in sixty minutes?

Katie: Yeah that's right. I think it just depends on how quickly you can read. A few people have told me that yeah they did manage to read it in an hour. So I know it can be done. I'm quite a slow reader so it might take me a bit longer. What I just hoped was there are quite a lot of books out there that are quite heavy, really detailed books on debt, but from my experience and the people I'm coming into contact with, when you are in debt you are so overwhelmed by it you don't really want to, or you can't face sitting down and reading the really heavy tone on the subject. So that's why I wanted it to be a 60-minute book. It's got 60-second pages, which sum up each chapter. So I just feel that for anyone, whatever stage you're at or however big your debts are, hopefully there'd be some practical advice in the book for you.

Rob Parsons co-author of 'Sixty Minute Debt Buster'

Sarah: Now one of the things I did really like was as you've mentioned, that you tell stories of real people and their battle with debt. You also give some very practical pointers to overcome similar issues and you mention in the book that all sorts of people get into debt. Give me some examples of how debt impacts upon people from all parts of society.

Katie: It's a really interesting point because whatever your income, whatever your job, whatever your family situation, none of us are immune from debt because debt is from all walks of life. We live on quite a fine balance sometimes. Many people don't see themselves as having a dangerous level of debt and they've got a number of loans and a number of credit cards and they're paying them fine each month; so they don't really consider themselves to be in dangerous debt. However it only takes something like losing your job, falling ill, a relationship breakdown or a redundancy and as you can see none of us are immune from those issues; you know one of those things can really tip the balance and all of a sudden you can't afford to keep payments on that loan or keep up the payments on that finance arrangement on the car. I found that from my experience and my work at the advice centre, that all kinds of people were coming through that door for advice. You know one day I even helped a financial advisor, other day's single parents who were working or who were on benefits, or single people, students, all kinds of people can fall into debt and find that all of a sudden they just simply can't keep on with things as they are and they need to seek advice. I think really it's just about realising that many people are in that situation. It's nothing to be ashamed about and there are people out there who want to help you, who will help you free of charge. Don't pay for debt advice because that's money you could be paying towards your debts. There are plenty of organisations out there who will help you free of charge. So don't be afraid to go along there's no stigma attached to it. There shouldn't be anything to be ashamed about. You're not going to get through it if you bury your head in the sand. You do need to grab the bull by the horns and make an appointment for some advice.

Sarah: In your book it's really clear that the heartbeat of what's coming out of it is the non-judgemental attitude towards people that find themselves in debt. You also talk in your book about working out how big the enemy is; so how big is the debt and being realistic about that. What's the lowest and also the biggest amounts of debt you've ended up working with?

Katie: I've dealt with people right across the board. I've had people coming in with just maybe a sixty pound mobile phone bill that all of a sudden they can't afford and they're really worried and for them that's a really big deal. I helped them work through that and negotiated a payment with that creditor, for them to pay a monthly payment that they can afford. Then I've gone right up the spectrum to people who have owed actually over a hundred thousand pounds was the largest amount of debt that I helped someone to deal with. Generally we're looking at about fifteen thousand pounds. People typically have had a couple of loans, a few credit cards, maybe a catalogue and so that was the general picture and the general shape of things.

Sarah: I was quite surprised in your book that you say that loads of people spend about ten per cent more than they actually earn. What are some of the symptoms that reveal that people are actually losing financial control?

Katie: It's an interesting point that ten percent thing. I think a lot of people would say "oh no, I don't agree with that". Or "why how does that happen". But I think society and the culture we're in now has kind of got us into the mindset of not saving up for things and just putting them on the credit card. We think about our pay rise and we think when the pay rise comes everything will be fine again and it is for a while, but then a couple of months after we got the pay rise we're back to that spending ten percent more again. I would say that some of the signs that you might be losing financial control are not knowing if the cash point is going to pay out. You know that terrible feeling when you go there and you're thinking oh please, you know I hope I can draw out this fifty pounds today, have I got enough money in there? So not knowing how much you've got in your bank account; maybe being afraid to open your bank statement; not opening them. Some people that I've come into contact with just come in to see me with a big bag of unopened letters; so being really disorganised with your bills and your credits card statements is a symptom. Maybe impulse buying; going out and just buying things thinking that this is going to make you feel better; this is going to give you that high; and then finding things still with tags on and carrier bags at the back of your wardrobe a couple of months later. Making the minimum payments on your credit cards; that's another really big one. Because you know we're never really going to become free of debt if we're only making the minimum payment from the card. I think quite a lot of people will leave making payments on their bills until the very last minute, maybe even until they get the red bill coming through; also some people find tenners in their pockets or losing money; readily borrowing or lending money to friends, these are all signs of being out of financial control.

Sarah: OK. Now obviously we don't want to give all of the handy hints in your book away. But what can people do in order to gain financial control? What's just a handful of practical tips that people might start to try out?

Katie: Well I think first of all I would just say, as we have spoken about already, if you are in debt, don't be afraid; sit down work out exactly how much you owe, make a list of it. Sometimes that can actually help you to feel better, because you can see the exact picture. You're kind of facing up to it. Just sit down and make a list of your debts. Then whether you're in debt or not it's really useful to have a budget that you stick to. Look at what your income is; how much you're spending. Are there any areas where you can make cutbacks? I think we can all make cutbacks generally. Is there a gym membership you can cancel or a magazine subscription? Do you really need to buy that lunch every day or could you take a packed lunch? Shop around for better deals for your insurances and your gas and electricity. Your mortgage even; although it is a bit harder to shop around for your mortgage at the moment. It's amazing just how much you can save by looking on price comparison websites and making sure you get the best deal for your money. A really good one is carrying around a little book with you where you note down what you spend; so keeping a spending diary. So you can see exactly where your money's going and it's not just disappearing into that big black hole that we're all so often used to. And sometimes one of the most effective, but almost it seems a bit old fashioned, methods of getting back into control, is starting to use just cash for a while. It sounds a bit old fashioned and it's something my grandparents used to do. But they were never in debt. If you just use cash, it seems a bit harder to part with your hard earned cash than to whack something on the credit card and you can really start to get a clear picture of where your money is going. So there's a few tips for getting back into financial control.

Sarah: Fantastic stuff. Now if people want to get more tips from 'The The Sixty Minute Debt Buster', then they can buy it from Cross Rhythms Direct for only £5.99.

Katie: I really urge you to go out and get one because it's got some fantastic advice in it whether you're in debt or you just want to be a bit savvier with your money. I just really hope that this will give people hope and will just make them realise that however serious the situation, even if you've got an eviction date to be evicted from your home, there are things that can still be done. Don't think that there's nothing that can be done. Go and seek advice. I really hope this book can help.