Having some form of long-term illness will be a worrying enough experience, but having to cope with mounting debts will not aid the recovery process. Having debts while employed can be stressful enough, but if you cannot work, and have debts due to illness, then a vicious circle can often be set in place.
Illness and Loss of Income
For many people illness does not necessarily mean loss of income. Long term sick pay from employers known as statutory sick pay will allow a sick person to have a certain percentage of their salary for a certain length of time. This percentage may then drop in relation to the amount of sick time. Some employees may start off at full salary for around six months and then drop to half salary for a further six months. This percentage is true of some, but not all employers.
A great number of employees will not receive any sick pay and will have to apply for government benefits when on long-term sickness. These benefits will be nowhere near enough to cover payments such as mortgages, rent, taxes and living expenses. This is when added stress can have a detrimental effect on the person who is ill.
Debts Causing Illness
If a person is seriously suffering from heavy debts, then the stress can sometimes be the cause of illness. People who are in debt can suffer from severe depression and stress, leading to absenteeism from work. Mental health experts have termed this condition as ‘money sickness syndrome’. This stress and depression is a mental illness and help should be sought as soon as possible.
Contact Your Creditors
If you explain your situation to your creditors regarding your debts due to illness, then negotiating repayments should not be a problem. Creditors are usually understanding in these circumstances and should offer to either stop interest and/or lower repayments until you can afford to repay them.
The Doctor’s Letter
When contacting any creditor, make sure that you have a letter from your doctor with details of your illness. In many cases this letter will be the only proof that you can show to creditors and it will make a difference with repayments. It is not unheard of for creditors to simply allow you to stop repayments, or even write off the debt completely on the strength of a doctor’s letter.
Credit Lenders and Illness
There are some credit lenders who are notoriously unsympathetic when it comes to illness and debt repayments. They are usually the largest high street lenders that offer credit to low income earners, but apply exorbitant levels of interest. Many of these lenders will demand their money no matter how ill you are. When confronted with this type of lenders the important thing is not to panic; you do have consumer rights.
Many people never factor in debts due to illness in any form of budgeting or money management plan. But illness can strike at any time without warning and some form of cover should be set in place. Contacting creditors as soon as a doctor has signed you off work due to long term illness is a wise move. The quicker you receive any benefits or medical insurance the quicker your stress will be relieved and your recovery can begin.
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Last Updated: 30-Jun-2016 07:39 PM
Copyright 2014 Fidson Healthcare Plc