DROWNING IN DEBT

It’s easy to end up out of your depth. You spend a bit more, borrow, lose a job, split with a partner or just ignore money issues.

We talk to Citizens Advice debt advisor Rachel Penny about how it’s never as bad as you think and how help is at hand.

WHAT BRINGS PEOPLE TO YOU?

When people come to us they’re often in dire straits. They don’t plan to get into debt, but so many things impact. It could be someone is on a zero hours contract, relationship break up, a life event like a wedding. Or they don’t have access to online advice. In a lot of cases people have just never been taught how to manage a budget.

HOW CAN YOU HELP?

We can help you make a plan to pay your existing debt, speaking to landlords and energy suppliers on your behalf. And we can help you maximise your income; get your full entitlement of benefit.

Part of our role is to empower someone, give them the opportunity to be in control, to say ‘I can do this’. Our money advice team includes a personal budgeting advisor who’ll sit down with someone and take the time to explain.

CAN YOU TRULY UNDERSTAND THEIR SITUATION?

I’m a single mum. When you’ve been through tough times yourself you can relate to people. But I can share my own experiences and tell them how they can still have the things they want. I’ve recently bought an almost new Next sofa for £200 from eBay. With the right help and way of thinking it can be done.

IS DEBT A SYMPTOM OF MODERN SOCIETY?

People have always had debt – in days gone by it would be the Provvy (Providence). Now it’s pay day loans with extortionate interest rates – not many people understand how annual percentage rate (APR) actually works!

IS IT ABOUT EDUCATION?

Yes. We should all learn how to budget from an early age. We’ve spoken to sixth formers who don’t even reali se you have to pay bills!

IS IT GETTING WORSE?

We’re seeing a big increase in the extent people are affected psychologically. It’s also a lot more intense, more and more people tell us they feel like taking their lives. We’re a tight team and we all support each other, but it can be tough.

PEOPLE SAY YOU HAVE TO TAKE DEBT TO GET A GOOD CREDIT SCORE?

Credit ratings do show you are reliable and can pay, but you don’t need to buy a big item like a car to prove that – a mobile phone account will do just as well. Get help – see page 10.

Rachel Penny, Citizens Advice debt advisor

I’m a single mum – I’ve been through tough times myself. Rachel Penny, Citizens Advice debt advisor.

I DIDN’T THINK I'D COME BACK FROM MY DEBT

Linda O’Neill (centre) with sister Mandy (right) who supported her to get help from Rachel Penny.

Linda O’Neill and her husband Kev each had their own roles when it came to the family finances. He’d manage the bills, she’d use their money frugally to keep them and their children fed and clothed.

“We’d never had a debt in our lives,” said Linda. “He gave me money and I did the shopping. We often struggled, but if we couldn’t afford it we didn’t buy it.”

When Kev died in 2016 Linda, now 62, was consumed by grief. It was her sister Mandy who realised bills were being left unpaid.

“I noticed a pile of unopened letters” she says. “Linda had no idea that they paid things like bedroom tax. I told her she couldn’t ignore it, she needed to get help.”

Jolted into reality Linda went into a state of panic. “I thought I’d go to prison. I couldn’t tell my kids – I didn’t want to upset them. I suffered depression and anxiety. I even thought of ending it all, I thought if I go my debts will go with me.”

Mandy persuaded her sister to visit Sefton Citizens Advice in Bootle. Even as they sat down with advisor Rachel Penny, Linda still felt the situation was futile. “I didn’t believe they could help. I thought they’d just say ‘it’s your problem, deal with it’. But Rachel just kept saying ‘don’t worry we’ll get it sorted’. I felt so relieved.”

Rachel contacted Linda’s creditors while a colleague accompanied her to court over unpaid rent charges. The court had been advised of her situation and the case was quashed.

The expert help and guidance she received has set Linda on a new path, with a better understanding of her finances.

Now on job seeker’s allowance she’s a volunteer in a local charity shop. “I didn’t think it was possible to come back, but I’m sleeping well and much more relaxed knowing things are under control. If anyone comes into the shop with debt problems I send them straight to the Citizens Advice service.”

YOU ARE NOT ALONE

Illustration by Ella Byworth

Almost 327,000 people contacted the charity Step Change for help with their debts in the first half of 2018. Around half experienced debt because of job loss, reduced income, or health issues. A third were behind on their council tax – by far the highest category of debt arrears.

WILL GETTING ADVICE LOSE ME MY JOB?

The Government debt advice service Step Change says many people worry that getting debt advice or choosing a certain debt solution will affect their job. They fear that having a poor credit rating might mean that their contract will be terminated, or they may feel embarrassed at the idea of their employer finding out about their debt. Their website says: “As our service is confidential, anyone can get in touch with us for debt advice and find out more about their options. What’s more, we will never tell your employer that you’ve been in touch with us.”

IN DEBT AND NEED HELP?

Get advice as soon as possible Reduce your bills by swapping providers.

WHEN YOU’RE BACK ON TRACK

Reduce your outgoings – it’s the only way to change things Save small amounts with your local credit union for life events.

SOURCES OF HELP

uSwitch – uswitch.com

citizensadvice.org.uk NODDLE free online credit score and app – noddle.co.uk Credit Union – findyourcreditunion.co.uk

DON’T STRUGGLE, GET HELP...

When you’re struggling it can feel lonely. But there are lots of debt advice organisations who won’t judge you. Even if you think you have no spare money they can find ways to deal with debts that you might not know about.

FIND OUT MORE...

The Money Advice service website has details of online, telephone and face to face services. moneyadviceservice.org.uk

Step Change Debt Remedy provides you with the expert advice, budget support and solutions to help you manage your debts. stepchange.org

National Debtline offers free debt advice online through its My Money Steps tool and its web guides, fact sheets and sample letters. mymoneysteps.org

Samaritans offer a safe place for you to talk any time you like, in your own way – about whatever’s getting to you. samaritans.org