Scots are stressed about their money situation but aren’t talking about it
There’s no doubt that being in debt can cause lots of stress and a new survey reveals that 77% of us are stressed about our money situation.
But we are not talking about it.
That’s a mistake because there’s lots of potential help available such as that from the team of expert debt advisors at Scotland’s Trust Deed.
The charity says that around three in four of us are overwhelmed with stress and it’s mainly down to our financial situation.
The charity questioned more than 1,000 people around the country and discovered that 17% said their finances caused them to be ‘very stressed’.
In addition, 14% say they worry every day about money and for 12% they worry two or three times a week.
Worrying over money
This worrying over money means that 80% believe they would be happier if they could earn more and 20% say they are often genuinely scared when they check their bank account.
However, the charity says that this isn’t the most worrying part – they say the big issue is that no-one seems to be willing to discuss their money issues.
So, while 20% of those who say they are bad with money, 38% saying they don’t feel comfortable discussing their money issues with someone else.
A separate study has highlighted that around 74% of people are so stressed about finances over the last year that they have felt unable to cope.
Discuss money problems
And there’s no doubt that for 22% of people when they discuss money problems it’s the level of debt that’s the biggest cause for stress.
This level of stress leads to memory and sleep problems and can increase the risk of heart disease and stomach ulcers. Some say they respond by drinking, overeating or taking drugs.
Fortunately, for people living in Scotland who are struggling with debt there are a range of options available including a debt arrangement scheme.
The friendly team at Scotland’s Trust Deed can help with debt advice or even help arrange to set one up.
For many people, the debt arrangement scheme is an efficient way to reduce their monthly repayments on debt to become a more manageable amount.
Sign up to the debt arrangement scheme
Those who sign up to the debt arrangement scheme will then repay everything they owe over a longer period of time but at a much lower rate.
The scheme has been created by the Scottish government and there are criteria around those who will be accepted on to it.
One of the big attractions for Scots struggling with debt is that once you have a debt arrangement scheme in place your lenders can no longer hassle you and you enjoy legal protection.
For other Scots worried about their money situation, it may be that a trust deed which is only available in Scotland, might be a better solution.
As with the debt arrangement scheme, a trust deed will see a Scot repaying what they owe at a more affordable rate for up to four years.
The big difference with a trust deed is that when this term comes to an end, the remaining debt is then written off.
Debt advisers at Scotland’s trust deed can offer help
If you live in Scotland and are worried about your debts then the team of debt advisers at Scotland’s Trust Deed can offer help and advice that’s impartial so you don’t have to follow what they recommend.
Break-ups can lead to a debts crisis for Scots
For many people, the break-up of a relationship can be a time of stress and worry but can also create a financial shock that leads people into a debt crisis, one charity is warning.
The charity also says that people under the age of 25 are more prone to money issues caused by poor budgeting.
However, it is the lack of money that comes from a financial shock such as divorce and redundancy rather than managing money poorly that leads many of us into the red for most age groups.
The charity adds that a large proportion of those seeking help for its services and advice are tenants and single parents.
A spokesman for the organisation said: “Our clients’ issues show that the problem of debt is far from solved and with the prospect of interest rate rises ahead it’s a mistake to be reassured that the wider economy is gradually improving.”
Average mortgage debt
The charity also says that the average mortgage debt they deal with is more than £3,000, for County Court judgements it’s nearly £2,000 and for council tax its £1,000.
However, there are also issues with rent arrears of nearly £1,000 and water and electricity bills of £700.
Despite the numbers of single parents with children accounting for 6% of households, the charity says that 21% of people asking for help for the first time fall into this category.
For many people, a divorce or redundancy can create a serious financial shock that they may struggle to overcome.
Debt solutions available for people living in Scotland
It’s at this point that advice should be sought from those who understand the debt solutions available for people living in Scotland.
Among these are a trust deed so someone can repay what they can afford for up to 48 months with the remaining balance being written off. There are strict criteria for those being accepted for a trust deed.
For those who don’t meet the requirements, for people in Scotland there’s the debt arrangement scheme which is run on similar lines.
Under the scheme, Scots can repay an affordable repayment rate over a longer term but they will repay all that they owe with nothing being written off.
There’s also the option for sequestration, or bankruptcy, but careful thought needs to be taken before undertaking this debt solution.
Friendly team of debt advisers at Scotland’s Trust Deed
The bottom line is that no one should suffer in silence when struggling with their debts and if you live in Scotland there are debt solutions available and the friendly team of debt advisers at Scotland’s Trust Deed can offer more help and information on these issues.
What options are there for Scots to deal with debts?
According to various charity and news reports, growing numbers of people in Scotland are struggling with debts but what options are available to resolve them?
The situation is different in Scotland because there are different routes to deal with debt then elsewhere in the UK.
For those who have some money to repay debt it is important that you deal with urgent debt first, these are the ones where the consequences of not paying can be serious such as losing your home for not paying the rent.
Also, for people living in Scotland you could approach creditors to see if you could pay less; or ask a debt management company to approach your creditors or consider loan consolidation so your debts are dealt with under one loan.
There’s also the option of a debt arrangement scheme, a trust deed or sequestration (bankruptcy). These are explained in more detail below.
There are advantages and disadvantages to each of these routes so you should get as much as information as possible before making a decision and do not sign anything until you know you are taking the best option.
Debt arrangement scheme
Set-up by the Scottish government, the debt arrangement scheme helps Scots manage their debts.
Under the scheme, you make a regular payment to your payment distributor who then sends portions of the money to your creditors. While you can apply directly for the debt arrangement scheme and approved money adviser can make an application for you.
The debt arrangement scheme is a popular choice because you will repay everything that you owe but at a much lower rate and over a longer period of time to help free-up money so you are not stressed about your debt situation.
Scottish trust deed
A trust deed is a legally binding agreement between yourself and your creditors with your assets, including property, being passed to a trustee to manage your financial affairs.
The aim of a trust deed is to pay those you owe money to as much as possible and your creditors cannot take action against you while a trust deed is in place.
You’ll need to have at least £5,000 worth of debt and should make regular payments for paying the debt which will be for at least four years.
The big attraction for a trust deed is that after four years you will have met your obligations and be discharged from it. The amount of debt that remains at this point will then be written off.
In Scotland there is also the option of sequestration, better known as bankruptcy, which is for those who have no money to pay debts or so little income that it will take many years to repay everything they owe.
You can apply for sequestration or your creditors may choose to sequestrate you. There are several routes to bankruptcy and you should take advice before pursuing this route.
Help and advice about a trust deed, a debt arrangement scheme or sequestration
For more help and advice about a trust deed, a debt arrangement scheme or sequestration then there’s a team of experienced and friendly debt advisers at Scotland’s Trust Deed who are available to give impartial advice.
This means that the advice they give you does not have to be followed but they will help you understand the options that are available and arrange for these on your behalf.
The number of Scots seeking debt help rockets
The numbers of Scots who are struggling with their debts and wanting help to resolve them is rocketing, one charity warns.
They say that the numbers looking for debt help have increased by nearly 50% over the last four years.
Worryingly, the charity says that dealing with serious debt is now part of day-to-day living for many people in Scotland.
They say that last year, more than 19,000 Scots were struggling with money problems – it has grown by 47% compared with 2013’s figure.
Indeed, the charity says that across the UK they dealt with the highest number of people seeking debt help in their 25 year history and helped nearly 620,000 people.
Average amount of unsecured debt for Scots
Their figures highlight that the average amount of unsecured debt for Scots last year was £12,488; that’s a fall of 1.5% from 2016 but still higher than the previous two years.
Also, when monthly incomes are taken into account, the charity says that the Scots who get in touch with them are 10% more in debt than others in the UK.
Reasons for the growing need for debt and advice in Scotland include rising prices and falling incomes.
The charity says that the average monthly income for Scots contacting them is £1,253, a rise of just £60 from the figure five years ago. The say incomes are not keeping pace with inflation.
This means that Scots are left with £15 a month after paying for heating, housing, food and other essentials.
In a report, the charity says that while the amount of unsecured debt is smaller, on average, it is widespread and entrenched for many people living in Scotland.
The charity also highlights that the rollout of universal credit is leading to a drop in benefit income leading to more people heading into debt.
Number of Scots looking for debt help
There’s no doubt that the number of Scots looking for debt help is on the increase and it’s important to seek impartial help and advice about the potential solutions to resolve your financial situation.
One of the best ways is to speak with the team of debt advisers at Scotland’s Trust Deed who can review your situation and recommend a course of action; this will be impartial advice so you don’t have to follow what they say.
It will be an interesting and helpful way to find what can be done and the team is available to speak with every day.
Among the choices available will be a trust deed, a debt arrangement scheme and bankruptcy or sequestration.
This last one is a serious course of action to take in resolving your debts in Scotland and you need to think carefully before proceeding.
The debt arrangement scheme
Alternatively, there’s the debt arrangement scheme (DAS) which was created by the Scottish government as a way to help people repay everything they owe.
The DAS works by agreeing an amount to repay your lenders which will be affordable and your debt repayment period will be extended so all of the debt you owe will be repaid in full.
There’s also the opportunity of a trust deed which works in a similar way to a debt arrangement scheme except when the agreed period, it’s usually four years, comes to an end any debt that remains will be written off as unaffordable.
Obviously, this makes it an attractive way to repay debt and it’s important for those who have at least £5,000 in unsecured debt to agree to the terms of the trust deed.
Advice about repaying debt in Scotland
For more help and advice about all aspects of repaying debt in Scotland, then you should contact Scotland’s Trust Deed who have the experience to help you resolve your current financial situation.
Debt crisis in Scotland with housing benefit reforms
The housing benefit reforms launched by the UK government is leading to a debt crisis for Scots, a report claims.
The findings from the Scottish Government highlight that rent arrears are on the increase with private renting increasingly becoming ‘completely unaffordable’ in some parts of Scotland.
The report highlights that the introduction of Universal Credit is having a big impact not only on the numbers who have rent arrears but also on how much they owe is increasing.
Their findings highlight that 72% of East Lothian’s social housing tenants who claim universal credit are now behind on their rent, compared with 30% on average for the region.
Around one in five of Scotland’s 2.4 million households receive financial help with their housing costs.
Parts of Scotland also highlight that some private landlords are looking to sell their rental properties which is making families homeless.
People living in Scotland and struggling with their debts
For people living in Scotland and struggling with their debts, there is help at hand and freely available advice.
One potential way to find out what you can do to deal with your debts is to speak with the debt advisers at Scotland’s Trust Deed who can discuss your current situation and a way to resolve it.
This advice is impartial which means you don’t have to follow it.
Along with the option of undertaking a trust deed, which is a way to repay your debts at an amount you can afford and the amount that remains at the end of the agreed period being written off, there’s also the chance of a debt arrangement scheme (DAS).
This was created by the Scottish government and works in a similar way to a trust deed in that you agree to repay your creditors at a lower rate for a set period until all of the debt has been repaid. This is an increasingly popular choice for Scots in debt.
Advantages and disadvantages with a debt arrangement scheme
As with the Scottish trust deed, there are advantages and disadvantages with a debt arrangement scheme with the advantages including protection from your lenders hassling you and all charges and interest being frozen on the debt.
The debt arrangement scheme helps to make unsecured debts, that’s things like bank overdrafts, payday and personal loans and credit cards, be more manageable.
The aim is to repay them at an amount you can afford over a longer period of time though it is possible to have a suspension of repayments should you suffer a reduced income temporarily.
The disadvantages to a debt arrangement scheme include not being able to include your secured debts such as a mortgage or hire purchase repayments and the arrangement will last until the debt is fully cleared.
Also, your name will be on the DAS register so you will be unable to borrow more money while the agreement is in place.
Living in Scotland and struggling with debts
For those who are living in Scotland and struggling with their debts, the debt arrangement scheme will appear to be attractive but it’s important you receive expert debt advice which may outline your other potential options.
If you want to know more about a debt arrangement scheme, or a trust deed, then you should speak with the team of debt advisers at Scotland’s Trust Deed as soon as possible.