Small Business Big Profit

This week was an enlightening one for me as I teamed up with a colleague to visit one of his prospective clients on a debt adjustment case visit and learn more about his work.

The prospect was a 60 year old landscape gardener who had damaged his back in a lifting accident eighteen months before.  As a result of the back pain and the inability to lift after the accident he had been forced to stop working for more than five months, and to do just light work since then.  For the five months immediately after the accident he had lived on borrowing from his credit card, using it for all living expenses and to cover hefty mortgage payments.

In the eighteen months the mental and emotional stress of borrowing more money on less income had taken its toll, to the extent that the man had got into a place where he was no longer opening the post and simply sticking his “head in the sand” like the proverbial ostrich.  When we arrived for the appointment the living room was a mess, the pile of post on the already untidy coffee table was six inches deep in unopened white official looking envelopes from credit card companies and store card firms. 

My colleague who is experienced at helping people in such situations simply sat down with the prospect and quickly came to the point.  Normally a prospect would have ready for the appointment, a list of the creditors who are owed money, together with the amounts due to them.  Knowing that this was not ready for our appointment my friend simply said, “I can see that you are not dealing with the post each day because of your fear of the situation and the numbers that might be involved.  I think the best way I can help you today is simply to take away these demands for payment and sort through them all.”

And that’s what we did.  Back at his office we spent a couple of hours opening more than seventy items of post relating to debt.  The vast majority were duplicated several times over and reflected the worsening situation that had arisen from his not dealing with the bills.  By the end of the evening we had a spreadsheet howing total monies owed of slightly over £48,000.

We had made an appointment to go back with the post and the accurate numbers the next morning, which we were able to do.  The client let us in and my colleague explained the amount owed and showed the client that he should actually be servicing these debts at more than £1,600 a month.  Against his current earnings of £1,100 a month in total there was of course no way he could make an impact on the debts and they were increasing by several hundred pounds a month due to the interest burden.

My colleague was able to highlight the value of the debt, the inability of the man to pay, and the implications of ignoring the problem going forward.  He was then able to come up with a Single Payment Plan that will be accepted by the group of creditors.  The debt is not going to go away, but the interest is frozen with immediate effect and the creditors can no longer make contact with the individual, having to come through the Debt Adjustment Manager instead.  Now the client has to make a single payment each month of slightly more than £100 each month.

The anguish has gone away.  The issue of living with the fear that came from not dealing with the post is already gone too.  Now the client can get on with paying an amount each month that is affordable and get on with his life, something that was simply not possible before. A great result.

Nick Rampley-Sturgeon is a small business owner who has benefitted from the experiences of success, failure and financial recovery. The author of “Small Business BIG Profit” published by FT Prentice Hall, Nick writes and speaks from the heart about Risk, Reward and the Power of Personal Enterprise.

For more information about the process and an introduction to a debt management planner, send an email to nick@smallbusinessbigprofit.co.uk with your details and situation.