By In 2021 I had £18,000 of debt spread across two credit cards, a personal loan, and a permanent £2,000 overdraft I’d stopped thinking of as debt at all. I was earning about £32,000 a year, living in a mid-sized UK city, and feeling vaguely anxious about money all the time without doing anything specific about it. The anxiety was chronic and background, the debt was growing slowly through interest, and I had no real plan.
By early 2023, I was debt-free. Here’s how it actually happened — not the polished version, but the real one including the months where nothing went right.
The Starting Point: Getting Honest About the Numbers
The first thing I did, which took courage I didn’t expect it to require, was write down every debt with its balance, interest rate, and minimum payment. The actual list: Credit Card 1: £6,200 at 22.9% APR. Credit Card 2: £4,100 at 19.9% APR. Personal Loan: £5,700 at 11.2% APR with 36 months remaining. Overdraft: £2,000 at 39.9% EAR (I genuinely didn’t know what the overdraft interest rate was until I looked it up — and that rate shocked me into action on its own). Total: £18,000. Monthly minimum payments: £380. Monthly interest cost alone: approximately £240. I was paying £240 a month in interest and barely reducing the balances.
The Method I Used: Modified Avalanche
The mathematically correct approach is the debt avalanche — highest interest rate first. My ordering: overdraft first (39.9%), then Credit Card 1 (22.9%), then Credit Card 2 (19.9%), then personal loan (11.2%). I modified this slightly because the personal loan had a fixed monthly payment I couldn’t overpay without a fee, so that one just ran its course in the background while I attacked the others. I diverted everything I possibly could — an extra £400-600 per month depending on the month — to whichever debt was the current target.
Month 1-3: The Overdraft
The overdraft went first. I treated it like a debt rather than a feature of my account, which psychologically was a shift. I kept £500 in my current account as a buffer at all times (so I never needed the overdraft) and threw £600 per month at eliminating it. The overdraft was gone in month four. The moment my account balance was permanently positive felt genuinely significant — more significant than the number suggested it should be.
Month 4-14: The First Credit Card
Credit Card 1 at £6,200 was the longest slog. I transferred the balance to a 0% balance transfer card (18-month offer, 2.9% transfer fee — net saving still very significant versus 22.9% APR). This gave me 18 months to clear it without interest accumulating, which changed the math considerably. I threw £450/month at it and cleared it in month 15. The balance transfer saved me approximately £800 in interest.
Month 15-22: Credit Card 2
By this point the pattern was established and the psychology had shifted. Debt payoff had become the thing I was doing rather than a sacrifice I was making. Credit Card 2 was cleared in seven months. The personal loan completed on its scheduled term around the same time.
What Made the Difference
Three things mattered more than anything else. First: seeing the real numbers. The list I made in month one made everything visible and specific. Vague anxiety was replaced by a concrete plan. Second: the balance transfer card eliminated the interest trap on the highest-balance card and changed what was achievable within the same monthly payments. Third: I stopped spending money on things I didn’t particularly value. Not dramatically — I didn’t move to a smaller flat or cancel my social life. But I became genuinely selective rather than default-yes to spending, which freed up the extra £400-600 per month without feeling deprived.
What Didn’t Work
Months where I was stressed or tired, my spending went up and my debt payment went down. Several months I paid only minimums. January was always terrible — post-Christmas spending hangover despite my intentions. I had to rebuild momentum after these months rather than treating them as evidence that the plan didn’t work. The emotional resilience to keep going after bad months was the hardest thing, not the financial strategy.
Pros and Cons of This Approach
Pros: The avalanche method genuinely minimizes total interest paid. Balance transfers are legitimate and powerful tools when used with discipline. Making the debt list at the start creates the clarity that makes progress possible. The habit of redirecting money intentionally toward a goal transfers to saving and investing once the debt is gone.
Cons: The process takes longer than you want it to. Bad months feel like failure even when they’re normal. The social and emotional cost of sustained financial discipline is real. Some people do better with the snowball method for motivation even if it’s mathematically inferior — the best approach is the one you’ll stick to.
