‘Can I reduce my debt while off work?’
Rachel Chloe Gaeta, 29, from Skegness, has been signed off work with stress but has big debts
“I worked at a bakery for eight years but, last September, I was signed off with stress caused by family problems. I don’t know when I’ll be able to return to work. I get statutory sick pay of £400 per month and housing benefits of £180 per month, but it’s too little.
“I was already in debt as my part-time salary was low, so I relied on credit cards. Last year I took out a loan of £11k to pay them off, but I’m struggling to pay back the loan. My credit card balances have crept up to £5.6k, too. My Barclaycard has £2.5k on it with an APR of 18.9%, while my Virgin credit card has a £3.1k balance with an APR of 20.9%.
“I was born with Turner syndrome, a genetic disorder that affects my height and sexual development, so I need regular health checks on my heart and kidneys. I am unaware if I’m eligible for any type of disability allowance.” SARAH’S 3-POINT PLAN 1) Ask for financial assistance. Rachel should speak to Stepchange or Citizens Advice to see if she is entitled to more financial support because of her health condition. She may be eligible for a Personal Independent Payment, which helps with costs related to longterm illnesses. Rachel should also speak to her local council about a reduction in council tax. 2) Prioritise health. Debt problems can exacerbate stress, so Rachel must think about her mental health. Her GP may be able to provide a Debt And Mental Health Evidence Form so her creditors take her condition into account. Rachel should also look at Mind.org.uk as they have advice about money and mental wellbeing. When she goes back to work, she should transition gently, perhaps with a part-time job that allows working from home. Although Rachel isn’t a mum, Workingmums.co.uk is the best place for advice and info on working part-time. 3)Confront the debt. Rachel can remain on good terms with her lender if she explains her situation. Lenders may renegotiate her borrowing or reduce the repayments. And Rachel should look to consolidate her credit card debt into one card, as her current cards are charging huge interest.