Debt series: Why we lie about debt

By Marianne Curphey


Many people are shy about sharing the details of their finances. Maybe you're not 100% honest with your partner about your debts or income, or you always accept invitations to go out with friends to try to "save face".

But debt isn't unusual. According to the Bank of England, Britons have more than £200 billion worth of unsecured debt. So why is it so hard to be honest about money matters - and why do some people fall into a pattern of lying about their debts?

Lying about debt is common among Britons
July 2017 research from online lender Sunny suggests that despite many people having relatively high levels of debt, few are willing to talk about it, even with their partner.

See the rest of the series

Check out the second instalment in this series, "How to spot problem debt" and the third instalment, "How to stay debt-free".

In fact, adults in the UK accumulate an average of £4,618 of debt before asking for help from their loved ones to manage it, Sunny's research found.  This figure is even higher among the over 55s, who don't tend to discuss their debt until it reaches around £6,441. For younger people (18- to 34-year-olds), the figure is only £2,936 before they seek help.

The study also showed that people tend to keep their debt secret from partners and family, something debt charities agree is common due to feelings of worry and shame. Of those questioned, 17% said they would never tell their partner or family how much debt they were in, regardless of the amount. One in 10 people (11%) admit to actively lying to their partner about how much debt they're in.

Sunny's research found that almost one in five (17%) UK adults are unaware of the extent of their partner's debt.

"A lot of our clients are proud and don't want to talk about money," says Michael Agboh-Davison, ‎debt advice coordinator at StepChange Debt Charity. "It's a very British thing."

Consequences of lying about your debt
"If you are in a lot of debt, the worst thing you can do is keep it a secret and carry on adding to what you owe," Scott Greever, managing director of Sunny, said in an emailed response to questions. "If you feel your debts are getting out of control, the first and most crucial step is admitting to yourself that you need help."

While it might feel easier to try to ignore the problem, this can lead to more stress, and might mean your debts increase, Greever says. The best way is to talk to someone about it.

"Whilst it can be uncomfortable, open up to someone you can trust, whether a partner, friend or family member," Greever said. "It may feel awkward to speak to a loved one about money but it's possible the person will be relieved that you've brought up the issue so they don't have to."

How to break the debt - and lying - cycle
There are several steps you can take to break the cycle of debt and lying:

1. Face the problem head-on.
Do not ignore letters and emails from your lenders, Greever said. Agboh-Davison says people are often reluctant to speak to lenders, thinking that they won't get a good response.

"That might have been the case 10 to 20 years ago, but now, the earlier you tell the lender you are having difficulties with payments, the earlier they can put a contingency plan in place for you," Agboh-Davidson says.

"Lenders will take account of the fact that you're struggling and may be able to help by adjusting how much and when you pay," Greever adds.

2. Get control of your finances.
You won't have to lie about your debt if you can tackle it.

You can take back control of your finances by drawing up a budget and getting a very clear idea of what money is coming in and what you have to pay out.

"Make a list of all the essentials that you need to pay for - housing costs, food, gas and electricity," he says. "Then think about what you can reduce. People should prioritise the essentials such as rent or mortgage, and utilities. If there is not enough left to pay for credit card or other consumer debts, then you need to [get help]."

Don't overlook all your resources for saving money that you can then put toward your debt, Agboh-Davison says.

For example, people often don't claim benefits to which they are entitled, such as the pension benefit for people of pensionable age, housing benefits for people on low incomes, and tax credits for working parents. This extra income might not completely plug the gap, but it will help to ease the pressure.

You could also shop around for better deals on household expenses such as utilities and insurance - the savings all add up.

3. Look for signs of irresponsible credit use.
Watch for signs of a shopping addiction or just plain irresponsible credit use.

"If you're struggling financially, credit should only be used for emergencies, not to support a lifestyle that's unsustainable," Greever said. If you're seeking new credit while you're drowning in debt, he said, ask yourself if it's for something that is necessary.

4. Get professional help.
There are many free resources available, with trained specialists who can help put your mind at ease and talk through your options to help you to move forward. StepChange, the Money Advice Service and the Citizens Advice Bureau all have teams of experts dedicated to helping people who are struggling financially, and can provide advice specific to each person's individual circumstances. 

The Money Advice Service offers a free budget planning tool on its website to help people take control of their money.  For an analysis of your spending and personalised tips to help you budget more effectively, visit:

"It really does help to talk to someone, and it can make a big difference," says Agboh-Davison.

See related: Industry responds to FCA's proposal on persistent credit card debt, How your debt, mental health issues are related, How to manage debt on an unpredictable income

Published: 22 September 2017