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Indebtedness and suicidal ideation in Hong Kong Dr. Edward K.L. Chan Department of Social Work and Social Administratio

Indebtedness and suicidal ideation in Hong Kong Dr. Edward K.L. Chan Department of Social Work and Social Administration The University of Hong Kong. What ’ s wrong? . Impact of indebtedness on the individual and on society Debt as a health risk to the individual

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Indebtedness and suicidal ideation in Hong Kong Dr. Edward K.L. Chan Department of Social Work and Social Administratio

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  1. Indebtedness and suicidal ideation in Hong Kong Dr. Edward K.L. Chan Department of Social Work and Social Administration The University of Hong Kong

  2. What’s wrong? • Impact of indebtedness on the individual and on society • Debt as a health risk to the individual • Debt as risk factor of suicide • Reducing productivity • Debt, as a main cause of bankruptcy, threat to financial system

  3. Individual indebtedness • Voluntary • Involuntary

  4. Voluntary indebtedness • Undertaken to increase personal satisfaction, consumer benefit driven • Types include: • Mortgage • Study loan • Cash advance - overdraft for any purpose • Credit Card debt • Business loan • Speculative activities • Financial instruments  investment in nature • Gambling  entertainment in nature

  5. Involuntary indebtedness • Driven by externalities • Family Life Cycle – maternity/ paternity, going to college / university • Lifetime crisis – unemployment, illness, injury, death of family members, divorce • Previously voluntary debt become dead weight debt due to interest repayment trap • Credit card: multiple credit card, paying only the minimal amount • Speculative activities: margin call • Cash advance / overdraft: compound interest • Personality impairment • Compulsive buying disorder • Problem / pathological gambling • Alcoholism • Substance abuse

  6. What is Debt? • Broad definition • A promise to pay tomorrow, for a consumption made today • Core: Future repayment, present consumption • Underlying uncertainty many variables involved

  7. About the study • Targets: enquirers of the “Healthy Budgeting- Family Counseling Programme” , by Tung Wah Group of Hospitals (TWGHs) • 783 subjects were recruited from Oct., 02 – Feb., 03

  8. Distribution of enquirers by sex

  9. Age profile of enquirers

  10. Marital status of enquirers

  11. Percentage of enquirers by total amount of debt

  12. Number of credit cards with outstanding loans

  13. Main reasons of indebtedness

  14. About 17% or 136 subjects had thought about committing suicide.

  15. Views of those who had thought about committing suicide

  16. Recommendations • Debt Counseling • Retain workforce • Restore repayment capability/motivation • Reduce family stress/tragedies

  17. 1. Debt Counseling • Three strategies: • Debt avoidance • Debt repayment • Coping with debt

  18. Debt avoidance • Increase protection over high-risk individuals (children of debtors, problem gamblers, individuals with addicted behaviors) • Skills and assistance in financial management • Value “saving for a rainy day”未雨綢繆 over “spending future money”先洗未來錢 • Speculative behavior of Hong Kong people • Recognizing the reality of potential debt from the status symbol (the gold credit card, the prestigious store charge card)

  19. Debt repayment • Amount of credit line used • Formal • Informal • Assessment of individual and Family Repayment Capacity • Prioritizing the debts • Improve communication, show effort in paying • Encourage the borrower to respond rather than keeping their heads low (typical behavior which tends to lead to more aggressive collection method) • Reduce debt/income ratio – avoid incurring new debts • Re-asses repayment period

  20. Coping with Debt • Build / improve / restore resilience in debtors and high risk individuals • Ability to cope with significant adversity: Problem-solving skills, Social competence (flexibility, communication), Autonomy (self-efficacy and self control), a sense of purpose and future (success orientation, motivation and optimism) • Improve social integration of debtors, in particular their relationship with their family and significant social nucleus • Alleviate stress, even provide financial safety net for debtors

  21. 2.Low Income Families Deserve Attention

  22. Low socioeconomic status / Socially disadvantaged: low income, unemployed, single parent, chronic illness patient and family, sudden lifetime crisis

  23. 3.Cross Sector Collaboration Creditor Market Information Debt Relief Arrangement Families-in-debt Financial Planning Family Casework Budgeting Education

  24. Wish you … • Free of debt • Free of interpersonal debt

  25. Thank You

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