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02/04/2010

Still in denial at the end of the recession: a third of those with debt problems have not told their family or partner

The stigma of personal insolvency has not lessened as new research shows that 30% of those struggling financially without help haven’t even told those closest to them. According to research from the R3, the insolvency trade body, a further 19% can’t even face opening their bills, while 21% said they ‘didn’t know where to go for help.’

“Here lies the damming spiral of personal debt,” says R3 President Peter Sargent. “Even after a long recession people are still terrified to ‘own up’ to debt problems. Yet this ultimately makes the issue worse – we know there is a group who are not addressing their financial problems and can’t even come clean to partners or family about them. In my years as an IP, I have seen many cases of people coming into my office with unopened bills. We need to break this cycle of fear. Even people who do seek advice usually delay six months in doing so.“

Nearly 90% of the group struggling financially thought that lessons in how to manage money should be taught in schools. Nearly half (44%) believe they have to pay for debt advice. Peter Sargent added:

“We need to make one point clear to those in debt; advice can be free. An Insolvency Practitioner (IP) will give you an hour’s free advice and the CAB does not charge. Financial education is also a great step for the future, and quite frankly if we were all able to talk freely about personal debt without fear, it would not be such a problem.”


Note to editors: 

  • Methodology note - Commissioned by R3, research agency ComRes surveyed 1,961 members of the public who describe themselves as struggling with debt by online questionnaire, between 17 December 2009 and 7 January 2010. Within this, sample, 1,193 individuals described themselves as struggling with their debts, but haven’t contacted anyone for help. 

  • According to research by R3, 90% of Insolvency Practitioners said they would give their first hour of advice free, but this should be confirmed in each case.

R3 Press Office

Notes to editors:

  • R3 is the trade body for Insolvency Professionals and represents the UK’s Insolvency Practitioners.

  • R3 comments on a wide variety of personal and corporate insolvency issues. Contact the press office, or see www.r3.org.uk for further information.

  • R3 promotes best practice for professionals working with financially troubled individuals and businesses; all R3 members are regulated by recognised professional bodies
     
  • R3 stands for 'Rescue, Recovery, and Renewal' and is also known as the Association of Business Recovery Professionals.