The fight to keep heads above water

“We’d never missed a mortgage repayment. Then all of a sudden (in the economic downturn) my husband lost his job after working at a place for 16 years.” – Salvation Army Moneycare client Kathryn

When Kathryn’s husband found himself suddenly unemployed, even though they had always managed their finances well, it didn’t take long for them to feel they were suffocating in debt.

Once the couple knew they couldn’t meet their mortgage repayments, they urgently sought legal advice, as well as advice and support from Moneycare, The Salvation Army’s free financial counselling service.

Kathryn says, at the time, she was desperately trying to work to keep their heads above water, and so having Moneycare financial counsellor Margaret, who was able to negotiate with the banks on their behalf when they were feeling very emotional and distressed, was a significant support. Margaret was able to organise significant relief while they sorted things out.

The couple eventually sold assets, which cleared debts, and her husband retrained and found work.

Kathryn says: “I now feel I can sleep at night. My husband can sleep at night. I’m able to breathe. As we stand right now, we’ve saved our home, which is fantastic!”

Services such as The Salvation Army’s Moneycare (which carried out well over 6,000 counselling sessions throughout NSW, ACT and Qld in the last year) can help with budgeting, negotiating and advocating with creditors, such as banks and finance companies. The Salvation Army can also provide small no interest loans (NILS) to those who meet certain criteria to help with essential items and emergencies.

The service also refers some clients to Salvation Army welfare support.

Moneycare head Tony Devlin says however that many, many clients are presenting in advanced stages of stress and anxiety, and some are suicidal, so step one is often not financial, but rather helping to deal with those issues.

Tony says: “People present to the service from every part of the financial spectrum, but financial counsellors are reporting a growth in clients struggling with living costs and increased utilities bills.”

This trend is also being noted in Sydney’s traditionally affluent suburb of Chatswood.

According to local Salvation Army Community Welfare Centre manager Carol Ennis, increasing energy bills are significantly adding to an alarming growth in demand for welfare, especially from aged pensioners.

Carol says: “Clients, especially those on a small fixed pension or benefit are almost crying, saying, ‘I don’t turn the lights on until it’s really dark, I wrap myself in a blanket…or I go out to the shopping centre because it is air conditioned or warm.’ They are having to make really hard choices and that is very common. They don’t have light and heating, or they don’t buy food.”

Carol says the service is strongly encouraging clients, especially those on a pension or other welfare benefits, to arrange with Centrepay to have a regular amount deducted each fortnight towards their bills. The fact that the client has been making a contribution, however small, helps to ease the stress when bills come in.

The service also refers clients with large power bills to the NSW Government Home Power Savings Program, which includes a free energy use assessment for low-income earners.

However, she says, it is of great concern that, however well managed, small incomes can still only stretch so far.

She says: “An elderly lady came to us with a bill and it wasn’t much, maybe $130, but she didn’t know how she was going to pay it. I assisted her with some vouchers and the lady just sat and wept– she was unaware of the help she could receive and had only come as a last resort to seek help for food.

“For me it is very humbling to see these pensioners, who have probably worked all their life, thinking that it’s come to this– having to seek out charity to help them with everyday living costs, often for the first time in their lives,” she says.