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How to identify that your friend has a debt problem?

August 3, 2023

Several million people – up to 10% of the population – are reluctant to admit that they are having debt problems.
As a result, we must call on friends and family members to do more to spot the tell-tale signs of money issues.
These include secretive behavior, or a tendency to buy the latest “must-have” items.
There can also be physical and emotional symptoms that they are in trouble.

Signs to watch out for include:

  • People have been in debt in the past
  • They have recently had a life event, such as a new baby, been made redundant, or gone through a divorce
  • They are living beyond their means, and always buying new gadgets or clothes
  • They are spending less time socializing with their friends
  • They are starting to hide issues and avoid talking about finances
  • They have reduced – or increased – the amount they are spending
  • They seem tired or are having trouble sleeping
  • They have put on or lost weight

If your friend is struggling now, chances are they’ll struggle to pay back a loan on time each month as well. So if a loved one asks you to be a guarantor on a loan kindly but firmly tell them no. Explain that you don’t want money or debt to ruin your relationship, but that you’re there for them and will do all you can to positively help their situation.

You could look at different ways they could make some extra money through selling on OLX, simple home office tasks, saving on costs like telco packages, utilities, rent, etc.

This would be an opportunity to suggest they get confidential debt advice but they must decide if they are ready for it or not.