| Whilst the effects that debt can have on a | | | | or monthly fee will normally apply, but at |
| person's life are well known, such as an | | | | least the debt is being given the attention |
| inability to get credit and no capacity to | | | | it requires before the situation |
| afford treats and luxuries, debt can also | | | | deteriorates. |
| have a far more profound effect on an | | | | |
| individual beyond the practicalities of life | | | | Then there are IVAs (Individual Voluntary |
| on the breadline. In fact, the anxiety and | | | | Agreements). These allow the individual to |
| stress caused by mounting debt problems can | | | | pay an agreed, reduced amount of the total |
| create feelings of hopelessness and | | | | amount of the debt. After a set amount of |
| desperation and can lead many people to | | | | years, the debt is generally considered to be |
| depression. | | | | settled. As this is a formal arrangement, an |
| | | | IVA is usually managed by a licensed |
| Indeed, this can also work in reverse, with | | | | Insolvency Practitioner (IP). |
| people suffering from mental health problems | | | | |
| and then subsequently going into debt due to | | | | The important thing to remember in all of |
| their inability to work. It is estimated that | | | | this is not to panic or ignore the problem, |
| one in four people in Britain who suffer from | | | | as unopened bills won't go away, and it will |
| mental health problems are also in some sort | | | | probably only lead to the situation |
| of debt or arrears, so there is a clear link | | | | spiralling even further out of control. It's |
| between mental wellbeing and financial | | | | always better to pay a small amount than |
| capacity. And this is why it's important to | | | | nothing at all, and this is why a debt |
| take effective action as early on as | | | | management plan is the best way forward for |
| possible. | | | | many people. |
| | | | |
| For anybody who is struggling to keep up | | | | Anxiety and stress caused by mounting debts |
| repayments, a debt management plan could be | | | | can lead to mental health problems in many |
| the best way forward from here on. These | | | | people; but it's important to tackle the |
| plans are typically administered by | | | | issue of debt at the earliest possible |
| specialist companies who negotiate a set fee | | | | opportunity and ensure it's managed and |
| with each creditor. The debt management | | | | monitored in equal measures. Otherwise, what |
| company will then collect the monthly payment | | | | begins as a small problem can escalate and |
| and distribute accordingly amongst the | | | | have repercussions for years to come. |
| creditors. Of course, a small set-up fee and | | | | |