How debt affects your job

How debt affects your job

Often, people don’t want anyone, especially their employer, to know their financial business or whether they are dealing with debt-related issues.

Your debt and finances are confidential to you, and legally, any debt-related matters can’t and won’t be discussed with anyone other than yourself unless you have given prior permission and consent.

However, this is not to say that your debt situation won’t affect your job, as this is a possibility in certain situations and industry sectors, especially when working in law or the financial sector.

It is always advisable to work with your creditors and professional debt collectors when you find yourself with overdue invoices, like the team at Direct Route, as avoiding these late payments will only lead to more stress and anxiety.

You can also seek the professional support of a debt advisor, who can help you better understand how debt affects your job and how to manage late invoice payments.

The effects of debt on your job

First, it’s important to note that not all job roles are affected if you have a debt history. In fact, not many businesses, unless you’re in banking or accounting, will perform a credit check and check your credit rating, so you can be assured that this information is not seen and will remain confidential.

If you do find yourself in debt and making repayments and you’re conscious of your employment status, make sure to check your employment contract thoroughly. The aim is to find out as much information as possible to understand better where your company and employer stand on debt without it impacting your job.

It’s important to check this out as your employer may have certain restrictions in place, and being aware allows you to better prepare for those conversations.

You can also speak to a member of your HR team confidentially to see how and if reduced payments or a debt solution could affect your job. They will be able to refer to company policy and may also be able to point you in the direction of debt advisors to help you further.

Bankruptcy vs debt management plans – how debts affect employment

Bankruptcy can affect your job role and position in a company compared to less formal solutions such as a debt management plan.

Roles and sectors where bankruptcy may be taken into account include:

  • Charity Trustee
  • Company Director
  • Insolvency Practitioner
  • Solicitor
  • Estate Agent
  • Consumer Credit Licence Holder
  • Accountant
  • Self Employed
  • Civil Service
  • Police
  • Security

Of course, outside of these roles and sectors, there is no legal requirement or obligation to inform your employer if you go bankrupt, but again, it is always advisable to check the terms and conditions of your employment contract.

Bankruptcy also stays on your credit report for six years, which people can access if they wish (and have the right personal information about you). So, it’s important to be aware that this information is still publicly available.

If you are declared bankrupt, you will not be able to become a company director without the court’s permission, and you will not be able to set up, promote, or manage a limited company without the court’s permission.

Bankruptcy may also mean you have to leave your position if you work for a bank, are an insolvency practitioner, or work in the gambling industry or other regulated sectors.

In comparison, a more informal debt management plan allows debtors to repay their outstanding debts in manageable instalments without the need to notify anyone, as this arrangement is between the creditor and the debtor.

Debt management plans are a great way to help debtors manage their money and support them in improving their financial situation. Helping to take a realistic approach to dealing with debt and avoiding it from becoming unmanageable.

These types of plans typically won’t prevent you from doing your job or carrying out your job

role; however, again, some careers may still possibly be affected, such as solicitor, accountant, director of a limited company, etc.

Although it may not directly affect your job, it may have a knock-on effect on your ability to carry out the role.

Again, it is advisable that you check the provisions in your employment contract and speak to a member of your HR team if you have any concerns or queries.

Invoice Unpaid?

Let us help.

We know that late payments and unpaid invoices happen, and we also understand that chasing payments and following up with customers can be time-consuming and resource-heavy.

That’s why, as a professional debt collection agency, we use our years of experience and knowledge to help you effectively and efficiently collect outstanding invoices and implement robust and successful credit control processes and procedures.

To avoid your business debts spiralling out of control, call us today on +447860197476.