We all know that dealing with debt is extremely difficult. You’re constantly getting notices, you can barely afford to make your minimum payments, your credit score decreases considerably, and you spent all of your nights lying awake thinking of ways in which you can get yourself out of the hole you dug yourself into. Watching a loved one suffer from this can be just as difficult as dealing with it yourself and can make you feel completely helpless. You might be thinking of loaning them money or helping them pay their bills — at the detriment of your own financial situation. But then, how can you help them without putting a dent in your own wallet? Read on to find out.
Recognize the Signs
Most people who are drowning in debt are too embarrassed to say anything about it to their loved ones, so it’s important that you try to recognize the signs. There are many signs that point towards a person struggling with debt, namely:
Their card being declined when you’re out with them.
This shouldn’t be cause for concern if it only happens once, but if this has happened multiple times when you were on outings together, then that generally means that your loved one isn’t even aware of their account balance because they are either avoiding looking at it, or don’t care enough anymore to keep track.
They don’t have any savings
They might mention in passing that they don’t have any savings to their name. Not having any savings is usually cause for concern, because it means that all of the money they make is going towards debt, rent, and other necessities. If all of their money disappears by the end of their payday, then that’s usually a sign that they’re struggling with debt. It’s not always the case — some people like to live beyond their means and are just spending all of their money without being in debt — but it’s usually the case.
They’re getting new credit cards
If your loved one is always using a new credit card, then that’s a huge sign that they might be drowning in debt. It usually means that they cannot keep up with their payments, maxed out their other credit cards, and are now using new ones to be able to pay for their daily expenses.
They’re moody and working overtime
It’s understandable that being constantly worried about your debt will not put you in a good mood. In fact, you’ll be so stressed that you’re probably going to try to find ways to be working overtime, which will contribute to even more lack of sleep and will worsen your mood even more. So if you notice that your loved one is constantly working and isn’t behaving the way they normally do, it’s a sign that they’re drowning in debt.
What You Can Do
Not knowing how you can help someone you love can be really difficult. Luckily, there are a few things you can do in order to help a loved one who is drowning in debt.
One of the worst things you can do when trying to help a loved one who is drowning in debt is to be judgemental. Sure, maybe you would never let your finances get to the point that your loved one’s are at, but that doesn’t mean you should tell them that. What they need right now is your support, not your judgement. Chances are, they’re already judging themselves enough. Not being supportive might only serve to cost you your relationship.
Do What Makes You Comfortable
Although you should be supportive, you still need to look out for yourself. If they ask you to lend them money or ask you to be their guarantor and you don’t feel comfortable with that, then don’t do it. You shouldn’t risk putting your financial health at risk unless you are 100% sure that the person you are helping will be responsible and make their payments. But just because you say no, doesn’t mean you can’t help. Instead of providing them with money or agreeing to become their guarantor, offer to help them create a budget so that they can keep track of all of their expenses and income. Sometimes, a budget is all someone needs in order to get them out of a sticky situation.
Refer Them to a Licensed Insolvency Trustee
If you’ve tried creating a budget with them, but noticed that they still won’t be able to make their payments on time, it would be wise to refer them to a professional such as a licensed insolvency trustee. A licensed insolvency trustee is trained to analyze one’s financial situation and provide the best solution. Each case is different, and they will find the perfect way for your loved one to get out of debt. There’s always a way out — but the sooner they start, the sooner they’ll find relief. So book a free and confidential consultation today.