Martin Lewis’ important debt warning revealed: ‘Life destroying consequences’

Martin Lewis’ team at Money Saving Expert offered “simple advice” – stop spending – although they admit that’s “easy to say and a nightmare to do”. A key issue that hits people’s ability to save is debt, and Money Saving Expert offered advice on how to avoid “disaster”. While small accumulations of debt may seem harmless at the time, Martin Lewis and co warn that spending more than you earn can start a vicious cycle. This is because you then spend to fill the gaps – and before you know it more of your income is lost to repaying debts – leaving many to borrow more to sustain their lifestyle.

Martin Lewis’ team offers two key pieces of advice to check if you are overspending.

In an article published on the Money Saving Expert in January, they warn “if you can’t answer the question ‘what are your debts from?’ there’s a problem.

“If you didn’t buy, for example, a car or a conservatory, but you’ve used cards or loans to fill gaps, an ear-piercing alarm should ring.

“Debt is fine if it is planned, rational, budgeted for and as cheap as possible.

“But if you consistently need to use the credit cards to supplement your monthly spend, you have a problem. Do that, and as I’ll explain in a moment, it can have life-destroying consequences.”

Money Saving Expert advises that you should work out where you are wasting your cash.

The article also offered advice on how to spend within your means.

It says: “Scrutinise everything, big and small, over a year, to prioritise what’s important and cutting anything that pushes your spending beyond your income

“Once you know what you’ve got and what you can spend it on, then you need to find a way to stick to it. An easy way to do this is to use the Piggybanking technique which uses different bank accounts to control your cash flow”.

They also advise using the Money Saving Expert Budget Planner.

In a 2015 interview, Martin Lewis was asked what his best ever business decision was, to which he replied “my website setup in 2003”.

The consumer finance information website provides the public with reliable information on saving money in the form of deals, tips and journalistic articles.

The website proved itself to be extremely successful, making millions before it was sold to moneysupermarket.com in 2012.

On the website, Mr Lewis told the Telegraph: “I spent £80 to set up a website in 2003. It’s called moneysavingexpert.com. It was built by a chap in Uzbekistan, off-the-peg, with forums, and in only two weeks.

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“It was the cleverest thing I did, but I didn’t know it was clever. My friend said it wouldn’t work, he said I needed to have adverts on the website and that ‘no one puts a face on a financial website’.

“I set it up because I thought the information should be out there, not to make money. It was only when the server costs became too expensive that I thought I should look at that.

“In the end, it’s turned £80 into more than nine figures, after tax. You also have to factor in the 90-hour weeks and the huge amounts of stress.

“Now people make the mistake of saying ‘you’re rich now that you’ve sold the website’. But they didn’t realise I was lucky, I’d already made a lot before that.”

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