Tauranga Budget Advisory Service is urging people in financial difficulty to reach out for help.
The call comes after total client debt rose by $11.5 million year-on-year last month to $48m.
That debt was being driven by money owed to finance companies, high-interest lenders, and credit card companies.
The service was holding free remote services by phone, email or Zoom during the lockdown.
Manager Shirley McCombe said many people struggled with finances and it did not necessarily have a lot to do with how much they earned.
''Covid has opened the eye of many people who, for the first time in their lives, are finding themselves relying on a benefit and are surprised at how little they receive. Especially those without children, who maybe own their own home but are left trying to meet their financial obligations, including mortgages on a core benefit, with or without an accommodation allowance.''
McCombe said she took her hat off to many of the people living on low incomes because they were extraordinarily resourceful.
''Although I'm pretty canny, I don't think I could do what they do, day in, day out.''
She said everyone had a combination of intrinsic and extrinsic factors that influenced their decisions when it came to money.
''Interest rates may be low, but only for those with solid incomes and good credit ratings. For those struggling, the options are more limited and the temptation to turn to easy access, high-interest providers is ever-present.''
Rotorua Budget Advisory Services manager Pakanui Tuhura said during the past five years the service had helped about 500-600 households (containing between 2000 and 3000 people) every year with total secured and unsecured debt of between $12m and $19m.
His team was available throughout the lockdown for clients via phone and Zoom.
Tuhura said he intended to reopen the office in level 2.
In his view, limited access to retail stores also meant beneficiaries would be better off through lockdown due to the reduction in household and travel spending.
''Hopefully, the lockdown will prompt most people who had debt issues going into lockdown to seek help with their debts. There will be a small group of people whose debts may increase during lockdown but typically they will seek us out post lockdown.''
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He said it was the repayment of debt and losing control of their money that caused stress and, in turn, relationship and social issues.
''Some people beat themselves up for getting into a high debt situation in the first place, others try to ignore the debt knowing that sooner or later the issue will hit them in the future. Every individual reacts differently ... but for most all they need is knowing where they stand and a little bit of guidance and advice for a way forward to regain control.
''This is why we encourage people to see us early so a plan to manage and control debt repayment can be put in place.''
Need help?
* Free remote service by phone, email or Zoom, Monday to Friday 9.00-3.30pm
* Remote service extended to two evenings, appointments Monday-Thursday 6.30pm-7.30pm and 8.00-9.00pm
* Contact Tauranga Budget Advisory Service 07 578 0969, text 021 08177107, admin@tgabudget.org.nz and www.tgabudget.org.nz
How do you make money decisions?
* Personality Types Some of us are impulsiveness spenders and prone to spur-of-the-moment purchases. Some of us are procrastinating strugglers and find it hard to spend, even when we need to. It is not about being right or wrong, but about understanding yourself and putting steps in place to help make decisions that will allow you to achieve your goals.
* Education For many people money comes in each week and is spent until it is gone, their parents were not taught how to manage money, so how could they teach their children. Often, this lack of confidence prevents people from seeking advice and perpetuates the cycle of poverty. As with so many things in life, knowledge is the key.
* Capacity Many of us struggle to understand contracts or to comprehend the impact of interest over the long term. The right support at the right time can make a world of difference.
* Health and Wellbeing The right support at the right time can make a world of difference. For those living with physical or mental ill-health, addiction, or in an environment of violence or abuse, financial wellbeing can be a real challenge. The role of a Financial Mentor is to understand our clients and work alongside them to access support, advocate on their behalf and provide them with the support they need to move forward.
- Source: Tauranga Budget Advisory Service
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