Don’t ignore debt – it will only get worse.
Explain your problems to someone you trust.
Be sure to get expert independent advice.
Take control of your money and spending.
Debt problems can happen to anyone for all sorts of reasons. Being in debt is incredibly stressful and damaging to your mental and physical health, but there are organisations that can help you get back in control of your finances.
There are many reasons that people can get into debt. You may be on benefits or earn a low income, you might not have enough money to cover what you need to spend, you might have a long-term health condition such as cancer, you might have a gambling habit or you may have lost your job and have large outgoings.
Debt can cause and be caused by mental and physical health problems. It is often tempting to ignore debt because thinking about it can cause you to feel uncomfortable, guilty, depressed and worried. Sorting out money problems can help you to feel better and to stay well.
Common things that can push you towards debt
There are some common things in life that can push you towards debt, or make existing debts worse.
Big life changes
You may lose your job, lose a loved one, break up with your partner, or there may be times when you have to borrow money, or stop paying bills, to cope with a new situation.
Long term ill health
Long term mental or physical illness can push someone into debt. If you lose your job – or have to spend a long time off work – you won’t have as much money and in addition to this, you may have to spend more on paying for prescriptions, travel to and from health services or trying to find a new job.
Not getting paid
Your benefits may be changed, missed or even stopped. You might find that you are not claiming all the benefits that may be available to you.
Low income
If your income is below the average, you are more likely to get into debt. Having to live on a low income for a long time means debts can mount up just to buy essential items. Eventually, the debt can increase to a point where just can’t get by without borrowing money.
Buying new things
Sometimes you just need to buy an essential – like a washing machine – or for others it can mean that you have spending sprees and buy lots of stuff that you don’t need.
Gambling
If you’re preoccupied with gambling, spending more and more time and money on it, chasing losses, or gambling despite serious consequences in your life, you have a gambling problem which can lead to more debt.
Ignoring the bills
If you are mentally unwell you may stop seeing people, find it hard to concentrate and communicate or just find it too much to think about money and bills. People can easily get into debt from just ignoring paperwork and bills.
Alcohol and drug misuse
If you’re spending a lot of money on alcohol or drugs you may find you need to borrow more to pay for essential items which can lead to debt.
Pressure from outside agencies
A bank, a loan company or even a loan shark can encourage you to take out another loan, perhaps to pay off an existing debt, or to get a credit card. Sometimes credit card companies increase limits, making you feel that it’s safe to spend more.
How you might feel being in debt
Feeling low or worried is a normal response when you’ve lost your job, been made redundant, cannot work due to your physical health or you’re struggling with debt. There are things you can do to help you feel less stressed about your situation.
I want to sort out my debt
However much you owe, the sooner you begin to tackle it, the sooner you will solve it.
First of all, tell someone you trust about it. This could be a friend, relative, colleague or a mental health worker. They will be able to help you to feel less powerless and more hopeful and can put you in touch with people who can help you out.
Money advisers
Money advisers are experts in tackling debts and can give you both advice and support. You need an adviser who is free of charge, confidential and independent.
Before you look for an adviser decide on what you want:
What will a money adviser do?
They may also be able to:
Getting support
If you feel uncomfortable about going alone to see a money adviser, ask a friend, relative or someone else who you trust to come with you.
You may only need them to come with you for the first session, but don’t be afraid of asking for them to come again if you feel you need their support.
What are priority bills and non-priority debts?
When you are experiencing debt it can be difficult to know what to pay first as there are so many things you need to pay out each month. Knowing the difference between a priority bill from a non-priority debt will help you.
Priority bills
Some bills are classed as priorities because the consequences of not paying them are greater than the consequences of not paying others. For example, if you don’t pay your rent or your mortgage then you could lose your home. You must always pay these before your other debts. Priority bills include:
Non-priority debts
Failing to pay non-priority debts is usually less serious than not paying a priority debt.
However, your creditors (the people that you owe money to) may take enforcement action against you if you do not pay them. This could result in your debt being passed on to a debt collection agency and a county court judgment (CCJ) being made against you. A CCJ could affect your credit rating. Non-priority debts include:
Options for dealing with debt
When trying to recover a debt, creditors may be entirely unaware of a mental health problem. They can act in inappropriate, and sometimes very distressing ways.
You will need to decide if you want to tell your creditors about your mental health difficulties. If you do, then your money adviser also needs to be aware of your mental health difficulties.
Next steps:
Repay the debt
If you have any available income, you can make a repayment offer (but only one which you can realistically meet). If you do this, then a creditor should be asked to freeze any interest on the debt.
‘Park’ the debt
If you have very little available income, you can make a nominal/token repayment for non-priority debts (e.g. £1) or request payment suspension.
‘Full and final’ repayments
This is when creditors may accept a lump sum offer which is smaller than the original debt.
Write-off the debt
This is not standard practice, but some creditors will write off the debt when a person has mental health problems.
Debt management plan
You make a single monthly payment to a debt management agency which then pays several creditors for you (note: you may have to pay a fee for this).
IVAs
In England, ‘Individual Voluntary Arrangements’ involve you paying agreed amounts over 3–5 years. The remaining debts are written off. This is an option to consider if you are able to make sizeable payments. For example, this is useful if you have assets to protect such as a house/car and if you have enough surplus income to repay some, but not all of your contractual obligations.
Debt Relief Orders (DROs)
In England, this is a form of insolvency for people with very low incomes and/or very few assets. Only an accredited money adviser can apply for a DRO. This is now the most popular and accessible form of debt solution if you do not have any assets to protect that are worth over £1000 (i.e. car) and have less than £50 a month surplus income. If you have debts of less than £20,000 then a DRO is always preferable to bankruptcy as it is much cheaper to apply for (£90 for DRO in comparison with bankruptcy that costs £680) They both have the same effect on your credit rating and a DRO lasts for 12 months.
Bankruptcy
This is an option if you owe a large amount of money and don’t have any assets. Bankruptcy lasts for up to a year (with restricted access to financial services). After this, debts are usually written off. However, the bankruptcy is registered with credit agencies for six years and can make it hard to get financial services in the future.
Tips for dealing with financial stress
Feeling low or worried is a normal response when you’ve lost your job, been made redundant, or you’re struggling with debt.
Keep active
Keep seeing your family and friends, your CV up to date, and try to keep paying the bills. If you have more time because you’re not at work right now, do some form of exercise – physical activity can improve your mood if you’re feeling low. Remember, there are plenty of free ideas to keep you fit like going for a walk, doing some gardening or turning the music on and having a dance.
Facing your fears
For example, if you’re going into debt, get advice on how to prioritise your debts from a money advice expert. When people feel worried, they sometimes avoid talking to others and can even lose their confidence about things they normally do without a problem, such as driving or travelling. If this starts to happen, facing these situations will generally make them easier.
Do not drink too much alcohol
For some people with money and debt worries, alcohol can become a problem. You may drink more than you would usually do as a way of dealing with your emotions or to just fill up time. But alcohol will not help you deal with your problems and could add to your stresses.
Keep your daily routine
Getting up at your normal time and sticking to your usual routine will help you maintain you health. If you lose your routine, it can affect your eating patterns – you may stop cooking, miss breakfast because you’re still in bed, or eat snacks instead of having proper meals. Learning how to cook healthy meals on a budget can also help you learn new skills.
You may have suspected for a while that someone you care about is going through a rough patch with money. Fewer than 1 in 5 people will seek help with their debt problems, with it often taking them to hit a ‘tipping point’ whereby something happens that makes things worse (such as an unexpected expense or immediate change in circumstances). It’s only at this point where the financial reality finally hits home, and this can have a huge impact on their mental and physical wellbeing.
In this section we provide information so you know what to look for and what you can do to help someone with their financial problems.
Debt warning signs
Debt warning signs:
The above can be extremely hurtful to experience however it’s important to understand the shame that people can feel when they are experiencing debt. In fact, people often withdraw when they need support from others the most.
How to support someone who is experiencing debt
Talk. Talking about debt is a first step in tackling it, support someone you care about by listening to them and researching local support services. Share online forums with them where they can see plenty of people exchanging conversations and asking for support in paying off their debts can help them to not feel alone. They need to know they’re not alone.
Avoid the quick fixes. Resist the urge to lend any huge sums. We don’t doubt that you want to help your friend or loved one, and chances are you’ve probably lent them the odd fiver every now and again, however it is important to know that some people can also get into debt because they sacrificed their own income in order to help someone they care about. If someone you know is struggling with debt now, chances are they’ll struggle to pay back a loan on time each month as well. If someone asks you to be a guarantor on a loan to help them get out of debt, kindly but firmly tell them no. Explain that you don’t want money or debt to ruin your relationship, but that you are there for them and will do all you can to positively help them with their situation.
Plan a realistic future. Support them through suggesting ways that they can make additional money or ways to save them money to help them with their debt. This would be a perfect time to suggest that they seek some confidential debt advice.
Rotherham Warm Welcome
Rotherham Council and its partners are offering a Warm Welcome at venues across the borough this winter.
These venues are open to anyone to use whether you want to meet with friends and family, get involved in events and activities, or just have a change of scenery while you read a book or do your crossword puzzle.
Rotherham Money Matters
If you are concerned about the impact the rising cost of living is having on your financial position and wellbeing, support is available. You can find a wide variety of advice, access to financial support and guidance on the Rotherham Council website. Money matters – Rotherham Metropolitan Borough Council
Citizens Advice – Rotherham and District
General advice line: 03444 111 444
Universal credit help to claim: 0800 1448 444
Main reception: 01709 515680
Email: debt.support@citizensadvicerotherham.org.uk
Web chat available
Citizens Advice Rotherham
The Rain Building, Eastwood Lane, Rotherham, S65 1EQ
Citizens Advice Rotherham offers practical up-to-date information and advice that is free, confidential, independent and impartial. Drop into our RAIN Building office and speak to an adviser about your problem Monday to Friday 9:30am–4.30pm
Cortonwood Comeback Community Centre
01226 759572
enquiries@cortonwoodcomeback.com
Chapel Avenue, Brampton, S73 0XQ
Registered charity offering a wide range of help and activities to the whole community, including: debt and benefit advice help with employment, job search and training.
Gambling and Debt
Gambling problems can happen to anyone from any walk of life. Your gambling goes from a fun, harmless diversion to an unhealthy obsession with potentially serious consequences. Whether you bet on sport, scratch cards, roulette, poker, or slot machines in a casino, at the track, or online a gambling problem can put a huge strain on your relationships, interfere with work, and lead to financial ruin. You may even do things you never thought you would, like running up huge debts or even steal money to gamble.
Kiveton Park Independent Advice Centre
01909 773966
info@kpadvice.org.uk
Kiveton Park Independent Advice Centre
Kiveton Park Community Library, Wales Road, Kiveton Park, Sheffield, S26 6RB
A free, impartial, confidential general advice and advocacy service for the people of Kiveton Park and surrounding areas, in conjunction with free legal advice offered by local solicitors. Lots of advice and information on the services’ website; especially around money and debt.
RMBC Advocacy and Appeals Service
01709 822293
advocacyandappeals@rotherham.gov.uk
The Advocacy & Appeals Service can give free advice and help you to draw up an income and budget plan, understand your priority payments and help you repayment offers or find a suitable debt solution. They can represent you in court on some issues, if your money problems are caused by a loss of benefit they can help you to challenge and appeal the award you have been given.
Suicide Prevention
Help and support is available right now if you need it, for yourself or for a friend, family member or colleague. You do not have to struggle with difficult feelings around debt alone.
Money Advice Service
0800 138 7777
Typetalk: 18001 0800 915 4622
WhatsApp: add +44 7701 342744 to your Whatsapp and send us a message
Web chat available
enquiries@maps.org.uk
Online free resources for advice and guides to help improve your finances, tools and calculators to help keep track and plan ahead and support over the phone and online. Phone support available Monday to Friday, 8am to 6pm.
National Debt Line
0808 808 4000
Web chat available
Independent charity dedicated to providing free debt advice by phone and online to people across the UK. Expert debt advisers who are supportive and trained to a high standard. Committed to providing free, impartial and confidential debt advice.
Phone support available Monday to Friday 9am–8pm, Saturday 9:30am–1pm
Step Change
0800 138 1111
Web chat available
Monday to Friday 8am–8pm, Saturday 8am–4pm
Provides the UK’s most comprehensive debt advice service. Helping people with debt problems take back control of their finances. Offers services including advice, budget and debt management plans.
PayPlan
0800 280 2816
Monday to Friday 8am–8pm, Sat 9am–3pm
Free debt management service and advice guides on budgeting and alternative debt solutions.
Turn2us
0808 802 2000
Monday to Friday 09:00–17:30
National charity that helps people in financial hardship gain access to welfare benefits, charitable grants and support services.
Mental Health and Money Advice
Clear, practical advice and support for people experiencing issues with mental health and money.
MIND – money and mental health
Practical tips on managing your money and improving your mental health.
NHS – coping with money worries
Advice and information on how to cope with money worries.
Gov.uk
Christians Against Poverty
Specialising in debt counselling for people in financial difficulty, including those facing bankruptcy or insolvency.
Services include Job Clubs, Fresh Start groups and Life Skills courses.
Mental Health and Money Advice: New cost of living hub
Mental Health UK, in partnership with Money Advice, have launched their new Cost of Living Hub to help those who might be feeling the strain as the cost of living continues to increase. Here you will find information about how you can maintain your mental wellbeing at this time, alongside information on how to manage your money as your bills rise.
Money Dashboard helps you to stay on top of your money. You can see all your accounts in one place, know how much money you have left until payday and grow your savings. A web app is available as well as smartphone app.
Emma helps you in avoiding overdrafts, finding wasteful subscriptions and giving the control you need over your finances. Connect all your accounts in one place, for free.
WorryTree helps you record, manage and problem solve your worries and anxiety based on Cognitive Behavioural Therapy (CBT) techniques.
The NHS App gives you a simple and secure way to access a range of NHS services on your smartphone or tablet.
You can use the app if you are aged 13 or over. You must be registered with an NHS GP surgery in England or the Isle of Man. You can also log in through the NHS website on a computer to use NHS App services.
HealthUnlocked is the world’s largest social network for health. Find and connect with people with a similar health condition. The service has over 700 online communities focused on health and wellbeing topics. With more than 4 million monthly users, there is a community for you.
