Call us for free on 0333 987 0005

If you are ready to talk to our non-judgemental guides – call us for free on 0333 987 0005.


Debt Problems and Feeling Isolated

Having debt problems can be worrying, stressful and often isolating. Not knowing where to turn and the feeling of shame and embarrassment that people often feel when it comes to debt can lead to real feelings of loneliness. According to a study from The Royal College of Psychologists, one in two people with debt problems also has mental health problems. It states that “debt can cause — and be caused by — mental health problems”. 

How to Manage Debt

Of course, the answer is to do all that you can to get out of debt. If your debt problems are alleviated, so will the feelings of worry. However, we at Debt Movement know that it is not always that simple. For most people, the road to financial freedom can be a long one. But starting along that road will bring the hope that you need to begin feeling positive about your financial future.

The first thing you need to do is to prioritise your debt. You can read more about priority debt in our debt help section. You must always ensure that you pay your priority debts as these carry the most serious consequences if they are left to go into arrears.

If you are beginning to have debt problems and are struggling to manage your debt, the most important thing to do is to contact your creditors as soon as possible. Many creditors will pause interest and charges to help you to catch up. 


Whether you are struggling to make ends meet or in thousands of pounds worth of debt, understanding how to budget is something that can improve your financial situation.

Keeping track of all of your income and outgoings can save you from getting into serious debt, and it’s never too late to start. Budgeting can help you with paying off your debts in less time and keep track of where you can afford to spend money. You can read more about budgeting and managing debt in our debt help section. 

Here are 5 quick steps to making a monthly income and expenditure budget:

    1. Calculate your monthly household income. Don’t forget to include alternative income such as a pension, spousal or child maintenance and benefits. If your income has been reduced recently or is expected to be, ensure you use the lower figure.
    2. Identify your priority bills. Priority bills include rent/mortgage payments, utility bills, council tax and other payments that carry serious consequences if left unpaid. You can find out more about priority bills here.
    3. Calculate your fixed outgoings. These should include your priority bills and any other fixed monthly payments that you need to pay, such as debt repayments, mobile phone bills, TV and broadband.
    4. Calculate your non-monthly fixed outgoings. It is here where many people fall short when trying to budget. There are often payments that we make throughout the year regularly but not monthly. These can include MOT and car tax, seasonal childcare. Once calculated, divide the total by 12 and you have your monthly total.
    5. Calculate your regular monthly spending. This is the other tricky one. Often when creating a budget, it can be difficult to remember all the small everyday costs. It helps to go over historical bank statements or receipts to get an average amount. Always round up to give yourself a buffer. These outgoings can include food shopping, clothing and uniform expenditure, hobbies and kids clubs, fuel etc. You can download our FREE personal budget tool in Excel here

See our full guide to creating a budget here.

Talk about money

A common feeling that many people describe when dealing with debt problems is the feeling of isolation, feeling unable to talk about money issues or feeling ashamed of their financial situation. This can lead to loneliness and other mental health problems. Not only can talking to people about your problems help to take a weight off your shoulders, talking to those within your household about spending habits can go a long way to reducing outgoings and working as a team to lower outgoings and general spending.

Alongside speaking to those closest to you, getting help and guidance from debt professionals can help you to understand your situation and the debt solutions that are available to you. With the link between debt problems and mental health problems being so strong, there are a lot of resources, services and helplines available to you if you feel that you need to talk to a professional about the way that your debt problems are affecting your mental health. 

You can find a list of services that provide help and support for those with debt and mental health problems relating to debt in our Help and Support Services section.

How much is too much debt?

According to many financial experts, debt to income ratio of under 30% is classed by lenders as low risk. This would suggest that anything over 30-40% would pose a risk of you being unable to meet repayments. If your debt to income ratio is high and you’re struggling to meet repayments, avoid taking on any more debt and seek help and guidance.

Knowing when it’s time to ask for help is important. Leaving it until it’s too late can have a serious effect on your credit file and even lead to bankruptcy. 

What Is Debt Relief and How Can Debt Movement Help?

Not to be confused with a Debt Relief Order, Debt relief is the definition of a debt solution that writes off or significantly reduces the debt owed by someone. Debt relief aims to make the best situation possible for both parties – creditors won’t waste time and money chasing debt that they may never recover and the debtor will only repay what they can afford.

A Debt Relief Order, or DRO, is a specific debt solution for those that have debts of less than £20,000 and no way of paying them back in the requested term. A DRO is set up through a DRO advisor and the Insolvency Service. It allows all payments, interest and charges to be frozen for 12 months. Once this process has started, your creditors are no longer allowed to pursue you for payment. There is a £90 set-up fee and the process will not begin until it has been paid in full. After the 12 months is up, if you are not in a position to pay your debts, they will be written off. A DRO will remain on your credit file for six years.

If you’re unable to meet priority bill payments and minimum debt repayments, contact Debt Movement for a free evaluation of your financial situation.  Our friendly and helpful guides will explain all of your options and debt solutions that may be available to you. If you’re also struggling with feelings of isolation, we may recommend seeking additional advice from charities such as Money and Mental Health or Mind.

Share on facebook
Share on twitter
Share on linkedin