Help me, help my friend

Money_Bunny

I've been following the boards for a while and I've been really impressed by the sensible advice offered. So, I'm taking the plunge and seeing if anyone can help me help my friend.

I don't think its fair for me to set out my friend's circumstances in too much detail but I will give a brief sketch.

My friend, who is middle-aged, has a history of mental health problems. She is completely unable to take control of her own life and heavily reliant on others to make decisions for her. Over the last few years she has leaned on me a lot because I'm "sensible".

She hasn't worked for a long time. Following the break up of her marriage she downsized and lived on the proceeds of the house sale. She then "drifted into" (true, even if it sounds odd)a degree course. Because she is a student she has no entitlement to benefits and she is living on student finance. The proceeds of the house sale have run out, she has credit card debts of some thousands and the student finance doesn't cover her living costs and debts.

And, on top of everything, her grown-up daughter has recently developed a serious and life-threatening disease.

Matters came to a head in the summer when she literally ran out of money. She rang me and I sent her to the CAB. As far as I can tell, the CAB have been great - they have spent hours with her and given some astute advice. But she mentally struggles to action what they tell her to do (so she failed to cancel Direct Debits and they all bounced). Her financial situation is now desperate.

So, some questions:

What are the key messages to tell someone with very low income and large credit card debts? (for example, should she keep paying the minimum credit card payments or stop? Are credit card bills more important than utilities bills?)

What suggestions should I make to put her on the road to long-term financial stablity (sell the house? give up the degree and go on benefits?)

How to ensure the sick daughter gets the attention and help she needs?

I should add that I can easily afford to give her a few hundred pounds (my husband thinks I'm mean for not doing so). But if I give her money I want it to help - I suspect if I just write a cheque the money will just "go" and she'll still be in the same position.

mildredalien

Hi there, sorry to hear about your friend's struggles!

My advice would be:
- Council tax is a priority, either as a debt or to focus on paying. If she is a student alone, she may be exempt, might want to check.
- Mortgage is another priority to keep up with
- Utilities would be the next priority on the list
- Credit cards/unsecured loans would be the lowest priority. She should consider writing to her creditors and offering a reduced payment that she can actually afford. To do that, she needs to figure out what she can afford!

Without more specific information about her income/outgoings it's difficult to know what further advice to give. Has she been in contact with student advisory and financial services, or the university mental health team? I assume there is some support available! If she is unable to process information that will help her get out of debt, is there anyone (family perhaps?) that could help out by taking over responsibility for finances? I'm not sure what the legal issues would be, but it might be possible...

Money_Bunny

Thanks Mildredalien. That's really useful advice. Council tax hadn't even occurred to me. There is no mortgage (which is why long-term, selling the house could be an option, I guess). Its good to know its utilities before credit cards. I had thought that ought to be the case but I was worried I was wrong (bearing in mind credit cards charge interest but utilities don't).

Student advisory gave her some very duff advice about benefits (suggesting she might be eligible when she clearly wasn't). Are there likely to be crisis funds and the like? I know universities have such things but this is a degree at a local college "university centre".

It sounds as though I maybe ought to press her to ask her brother to help. I think she really wants me to take over her finances - not only do I not want to but because of my job I don't think it would be "proper".

I don't really want to post more specifics as its not really "my" information.

mildredalien

Heya - I can understand why you don't want to post more info here, maybe it would be worth sitting down with her and going through her finances, trying to get an idea of what her income and outgoings are. That way you can help her figure out whether it's something she can manage or whether she'll need some help. It could be that she needs to arrange a debt management plan - there are free charities that can help give more specific advice such as Payplan or CCCS.

Not sure about crisis loans etc., it's been an awful long time since I went to uni hehe! When is she due to finish? Is there a decent prospect of work, or is her mental health likely to cause issues there?

Credit cards and loans do charge interest, but you need to pay mortgage/council tax/utilities etc. to keep yourself in liveable conditions! If it means paying £1 token payments to unsecured debt, so be it.

I would say though, you are a very good friend but you don't need to do this alone! If she has family or you have other people to help, I'd get them involved. It might not mean paying her way, just giving her a hand with budgeting, prioritising and paying bills. Is she in contact with community mental health services? They may be able to provide some support and advice.

Time_to_face_the_music

Hi Money Bunny :hello:

Check out this information

http://www.direct.gov.uk/en/DisabledPeople/EducationAndTraining/HigherEducation/DG_10035904

Money_Bunny

Lots of useful advice. Thanks so much. I myself feel a lot better for writing this down.

It sounds like there is a lot more support out there than I imagined. I guess I need to get down to finding out how to access this in her area.

Silly question, but is there any charity that would manage her finances for her? I honestly don't think however much "good advice" she receives she'll be able to do much for herself. I mentionned her brother but I know the thought of approaching him would horrify her.

I cannot think that realistically she'll ever be able to work. So this is about long term strategy as much as dealing with the immediate crisis.

ChopinonaBudget

Hi have you contacted MIND? They have all sorts of useful information of mental health problems, and also might know if there are any services or charities that your friend could access to help her in a practical sense to get her finances dealt with.

Blue_Elephant

Didn't want to read and run - there's a leaflet on here entitled mental health and debt - it's free to download and gives you a guide on options. It's really common as both problems feed into each other.

good luck to you both x