Debt is more than just a financial burden it can have a profound impact on your mental health and overall wellbeing. At My Debt Plan, we understand how overwhelming debt can feel, and we’re here to help you regain control of your finances and your life. In this blog post, we’ll explore how debt affects mental health, whether debt can be written off due to mental health issues, practical strategies for coping, and the options available for writing off debt.

How Does Debt Impact Mental Health?

Debt and mental health are closely linked. Research shows that around half of all adults with debt problems also experience mental health issues, ranging from persistent anxiety and low mood to diagnosed conditions like depression. The stress of managing debt can:

• Trigger or worsen anxiety and depression
• Lead to sleep problems, which further affect mood and energy
• Make it harder to focus at work or maintain healthy relationships
• Create feelings of isolation, especially if you feel unable to talk about your situation with loved ones

Mental health problems can also make managing money more challenging, creating a cycle where financial difficulties and mental health issues feed into each other. If you’re struggling, know that you’re not alone many people face similar challenges, and support is available.

Can Debt Be Written Off Due to Mental Health?

In certain circumstances, it is possible to ask creditors to write off your debts due to mental health issues. This is usually considered a last resort, typically when your situation is unlikely to improve, and there are no assets or income to pay the debt. Creditors are not obligated to agree, but industry guidelines encourage them to consider writing off unsecured debts when mental health conditions are long-term and there is little chance of repayment.

To support your request, you may need to provide medical evidence. The Debt and Mental Health Evidence Form (DMHEF) is a standard form that can be completed by a health or social-care professional to confirm your situation and help creditors understand how your mental health affects your ability to manage money. While not all creditors will accept the DMHEF, many are familiar with it, and it is recognised by the Financial Conduct Authority.

How to Mentally Deal with Debt

Coping with debt-related stress is crucial for your mental health. Here are some practical strategies:

• Reach Out for Support: Talk to friends, family, or a debt adviser. Sharing your worries can lift some of the burden and help you feel less alone.
• Develop Healthy Financial Habits: Create a budget to track your income and expenses, set savings goals, and make informed spending choices. This can help you regain a sense of control.
• Practice Mindfulness and Stress Management: Techniques such as meditation, breathing exercises, and cognitive-behavioural methods can help you manage anxiety and challenge negative thoughts about debt.
• Seek Professional Advice: Expert debt advisers can help you understand your options and negotiate with creditors on your behalf.
• Look After Your Wellbeing: Prioritise sleep, exercise, and a balanced lifestyle to support your mental health as you work through your financial challenges.

Can You Get Debt Written Off?

There are several ways to have debt written off, depending on your circumstances:

• Individual Voluntary Arrangement (IVA): An IVA is a formal, legally binding agreement between you and your creditors. It allows you to make affordable monthly payments over a fixed period (usually five years), after which any remaining debt included in the IVA is written off. An IVA also protects you from creditor contact and legal action during the arrangement.
• Debt Write-Off Requests: If you cannot afford to pay your debts and your situation is unlikely to improve, you can ask creditors to write off your debts directly, especially if supported by medical evidence of a long-term mental health condition.
• Other Solutions: Depending on your situation, options like Debt Relief Orders or bankruptcy may also result in debt being written off, though these have significant consequences and should be carefully considered with professional advice.

You’re Not Alone – Support Is Available

Admitting you’re struggling with debt can be difficult, but it’s the first step towards recovery. At My Debt Plan, we offer empathetic, expert advice and a range of solutions—including IVAs—to help you take back control. If you’re experiencing mental health challenges due to debt, reach out to our team for confidential support and guidance tailored to your situation.

Remember, debt does not define you, and with the right help, you can find a path to financial stability and improved wellbeing.