A recent report states that debt-related stress is widespread in Australia, particularly for young people between the ages of 25 to 34.
“Debt” can be defined as a state of owing money, and is a word that can strike fear into the hearts of most Australians. Credit is easily obtainable, which can mean that getting into debt is much easier than getting out. Whether debt is personal, business-related or as widespread as national debt, the effect on the individual can be phenomenal. The global financial crisis (GFC) had a huge and lasting effect on a large number of Australian people, who lost jobs, homes, superannuation and savings.
The recovery from the GFC was a long process of which many Australians are still suffering from. One lasting effect from the GFC is that we have become more aware of the extreme impacts that debt can have on individuals and families. As a result, many people experience an overwhelming feeling of panic related to being in debt, and yet have not developed the skills to best deal with creditors and financial institutions. Payday lending, characterized by small loans with huge interest rates, is also on the rise. This is a dangerous option for people already in debt, as the relief is temporary whilst the cost is large and prolonged.
An example of the stress related to debt can be drawn from a recent client of our service, who presented to MIDLAS after her husband’s death. She had been left with several debts including credit cards, a St John Ambulance bill and a Telstra debt. She had been experiencing severe anxiety related to her husband’s death and the pressure of having to manage their finances alone. As a result, the client had become emotionally unstable and demonstrated risks of self harm in the weeks before her appointment. A MIDLAS financial counselor worked with this client to obtain a waiver on the ambulance bill, a hardship variation on her credit card and a considerable reduction on the Telstra bill. This client needed the support and advocacy MIDLAS could provide and was able to build her confidence to take control of her financial situation. This is only one example of how debt-related stress was alleviated by talking to a financial counsellor and learning skills and exploring tools and options that are available.
MIDLAS offers Financial Counselling and can assist with the Hardship Utilities Grant Scheme (HUGs) applications to assist in the alleviation of debt-related stress. Financial counseling can provide you with options, information, referral and advocacy on your behalf to successfully deal with creditors. HUGs appointments can result in a financial contribution that goes towards outstanding utility accounts.
The stress related to being in debt can be overwhelming and can start to impact other areas of your life. Act early. Be empowered. Contact MIDLAS for an appointment on 9250 2123 or leave a message on our website: www.midlas.org.au