If your mental health fluctuates being in debt can bring on a bad episode. If you experience anxiety or depression, you may feel tempted to ignore the problem, hoping that it will go away. You may become too afraid to open any official-looking envelopes or answer the phone. For help with these feelings see our page on dealing with difficult money stuff.
If you are in financial difficulty, you may feel ashamed or scared and not want to talk to others about it. There are sources of help that will allow you to regain control and will not be judgemental.
Being in debt means that you owe somebody money. Owing money is not in itself a problem. Many people owe money, for example throughout the lifetime of their mortgage, use credit and other financial services and are able to manage their finances without any worries.
Many people experience problems with debt. If you do not have enough money to meet all your necessary outgoings like food, rent and bills and to make the minimum repayments on all your debts then you may have problem debt. There are steps that you can take to prevent your debts becoming out of control.
If you are in financial difficulty, you may feel ashamed or scared and not want to talk to others about it. There are sources of help that will allow you to regain control and will not be judgemental.
To work out whether the money you owe is likely to cause you problems you can take the Financial Services Authority (FSA) Debt Test or use the CCCS Debt Remedy Tool.
If you've decided that you do have problem debt, there is a lot you can do about it and the earlier you start the better. Facing up to a difficult situation may not be easy but you are likely to sleep better once you have a plan of action. Citizen's Advice, National Debtline or another free, independent, confidential face-to-face advice service will be able to help. If you are happy talking to someone on the phone, you could contact National Debtline, whose advisers can talk through your concerns with you. The National Debtline has a self help pack that contains all the information and standard letters you need to deal with your own debt problem. The pack shows you:
If you would prefer, you could ask a friend or family member, your carer, your local Mind association, local advocacy service or other support service to help you contact someone for help. For details of your local Mind association see Mind in your area.
Debts can be split into two distinct groups, priority and non-priority debts.
Debts that might result in you losing the roof over your head or getting into legal trouble are called priority debts. Sometimes you can negotiate payment amounts with creditors for priority debts. It is important to focus on repayment of these debts first, due to the legal impact of the debts.
Priority debts are:
It can often feel as if non-priority debts are the most important because you might be chased more persistently to repay them or because you feel a personal obligation to pay back debts to family or friends first of all. However, debts that do not affect your home or have the immediate threat of fines or legal action are considered non-priority.
If you have a limited amount of money you should pay your priority debts first. But if you have non-priority debts it is still important that you deal with them, as you may ultimately be taken to court if you do not make arrangements to repay these debts.
Non-priority debts include: