Taking the shame out of debt

In times of recession, most of us have to cut our spending in one way or another in a way that’s usually relative to our income. If you have a reasonable income and could previously afford to eat out once a week, then ‘cutting down’ might mean only eating out as a family once a fortnight or once a month. If you are on a minimum wage, then cutting your spending will probably be more difficult and may involve real hardship and/or spending less on heating and food.

If you are part of a couple, you may deal with money worries in different ways, with one partner internalising the pressures felt whilst the other one might want to talk about the difficulties a lot of the time. Maybe you judge yourself or your partner for being in debt – there can be judgement that you are an irresponsible person if you can no longer pay your bills on time. When there are financial difficulties, people sometimes blame one another and become more critical of the way money is spent. Clients have told me that their sense of well-being has been seriously affected when they’ve been in debt and that in itself has affected their relationship.

As well as this, people have been brought up in different families where priority was given to different things such as going on holiday being more important that having new clothes on a regular basis. These differences can cause a lot of friction and may not have been apparent when things were going well emotionally and financially.

However, if things have already escalated and one or both of you are feeling harassed, losing sleep and worrying about your situation most of the time, admitting that you have debts is the first stage in resolving the problem. Embarrassment can stop you asking for help but if you manage to overcome this you can then take the following steps to deal with it:

• Talk to your partner or a trusted friend about the issue, how you are feeling about it and what you might do to resolve it.

• Make a list of how much you owe and whom you owe it to. Mortgage or rent payments are most important, so tackle them first. 

• Speak to your lenders. They may agree to you stopping payments for a while if your problem is a temporary one or they could arrange an IVA (Individual Voluntary Arrangement) to pay off the debt at an affordable rate for you.

• Find out how else you can make money. Is there a skill you have that could help you with a second job from home in the evenings? 

• Can other family members lend you money instead of a bank or finance company? If you are able to borrow from within your family or from friends it’s vital to make sure that you agree on a regular method of realistic repayments with an end date for both parties. If you don’t do this, resentment can build up and spoil the relationship.