There are a number of reasons why having a disability may make you more vulnerable to debt. These can include:
The additional costs associated with living with a disability, which include everything from paying for carers to making adaptations round the home and the extra costs travel may bring. While financial assistance is available with all these areas, what is covered depends on your circumstances and where you live, and not everyone claims their full entitlement. Difficulty obtaining benefits can therefore compound the problem.
Finding a job can be more difficult with a disability and a long-term lower income can make it more difficult to repay the money you have borrowed.
Difficulty budgeting - while this can affect anyone, aspects of some disabilities may make it more difficult for someone to manage their money well.
Shopping around for financial products may be more difficult, encouraging more reliance on mail order or services that can be accessed from home.
Irresponsible lending, which doesn't take into account difficulties people face in paying back the money they owe can lead to people borrowing more than they can afford. This can be compounded by a lack of the support needed to make their repayments.
Reducing your debt
It can be easy to push your concerns with your debt to one side, focusing on other aspects that are directly affected by living with a disability, but as with anyone, ignoring the issue will only worsen the situation.
Although having a disability can make it particularly hard to tackle uncontrolled debts, espeically if you have a low income, there are steps you can take to help address the problem.
If you are finding it hard to pay back your debts, the following may help:
Get in touch with your lenders
It is important that you contact your lender/s as soon as you get into difficulty.
While they won't waive your debts they will often help you by renegotiating your borrowing and could reduce the money you need to pay back each month to a more achievable level. While this can mean that you will pay more in interest overall, in some circumstances it can help make debts more manageable.
Determine your budget
Total up your weekly or monthly earnings, as well as any benefits you receive, along with everything you spend your money on during this period. If the money coming in is less than your outgoings, identify non-essential areas where you can cut back your spending.
To help with this determine how much you spend on your accommodation, utility bills, food and anything that relates to your disability; pay for these expenses first and then see how much money remains for other items.
Avoid further debt
While further loans or other forms of borrowing may seem attractive when you are not making ends meet, taking out more money should be avoided, as it will only perpetuate your problems with debt.
The only exception to this is if you can consolidate your debts to make them cheaper (via a balance transfer for instance) but you should carefully work out the cost and check your likelihood of getting approved before you apply and not borrow more when you do so.
Ask for help
Speaking with an impartial debt adviser will allow them to tailor a plan to your individual needs to help you clear your debts. It is also important to seek advice on whether you are receiving all the financial assistance that you are entitled to. Contact companies like StepChange or the Citizens Advice bureau for help.
Financial assistance that may be available to you
If you are struggling with your repayments, your disability may entitle you to financial help to ease your debt problems.
This will depend on your circumstances and is assessed on a case by case basis, but you may be able to claim the following:
Personal Independence Payment
If you are not already claiming Disability Living Allowance, this payment is being phased in and is available for new eligible claimants to help with the extra costs related to disabilities and chronic health problems. This is assessed based on your care needs and your mobility; you may receive payments towards one or both of these, either at a standard or enhanced level.
Employment and Support Allowance
If your disability prevents you from working, this benefit provides assistance; equally if you are able to work with your disability, you can receive money towards supporting this.
Benefits for industrial injuries
If you developed your disability as a consequence of a work-related accident, you may be able to claim Industrial Injuries Disablement Benefit.
If you're over the age of 65 and your disability means that you require care or supervision, you can receive money towards this. If you receive Industrial Injuries Disablement Benefit and require daily care, you may be able to claim Constance Attendance Allowance.
You may be able to claim Income Support if you are not working or you do so for less than 16 hours each week. Another benefit to be aware of is Working Tax Credit, which may be available to you if your work at least 16 hours weekly and you receive a disability related benefit.
While avoiding debt is the best option, if this is not possible, taking the necessary steps to address problems with repayments early on allows you to regain control of your finances, so there will be one less problem for you to worry about.