Indebtedness and suicidal Indebtedness and suicidal ideation in Hong Kong ideation in Hong Kong

Dr. Edward K.L. ChanDr. Edward K.L. ChanDepartment of Social Work and Social Department of Social Work and Social

AdministrationAdministrationThe University of Hong KongThe University of Hong Kong

What’s wrong? What’s wrong? Impact of indebtedness on the Impact of indebtedness on the

individual and on societyindividual and on society Debt as a Debt as a health riskhealth risk to the individual to the individual Debt as risk factor of Debt as risk factor of suicidesuicide Reducing productivityReducing productivity Debt, as a main cause of Debt, as a main cause of bankruptcybankruptcy, ,

threat to financial system threat to financial system

Individual indebtednessIndividual indebtedness VoluntaryVoluntary InvoluntaryInvoluntary

Voluntary indebtednessVoluntary indebtedness Undertaken to increase personal Undertaken to increase personal

satisfaction, consumer benefit drivensatisfaction, consumer benefit driven Types include: Types include:

Mortgage Mortgage Study loanStudy loan Cash advance - overdraft for any purposeCash advance - overdraft for any purpose Credit Card debtCredit Card debt Business loanBusiness loan Speculative activitiesSpeculative activities

Financial instruments Financial instruments investment in nature investment in nature Gambling Gambling entertainment in nature entertainment in nature

Involuntary indebtednessInvoluntary indebtedness Driven by externalitiesDriven by externalities

Family Life Cycle – maternity/ paternity, going to Family Life Cycle – maternity/ paternity, going to college / universitycollege / university

Lifetime crisis – unemployment, illness, injury, death of Lifetime crisis – unemployment, illness, injury, death of family members, divorcefamily members, divorce

Previously voluntary debt become dead weight debt due Previously voluntary debt become dead weight debt due to interest repayment trapto interest repayment trap

Credit card: multiple credit card, paying only the minimal amountCredit card: multiple credit card, paying only the minimal amount Speculative activities: margin call Speculative activities: margin call Cash advance / overdraft: compound interestCash advance / overdraft: compound interest

Personality impairmentPersonality impairment Compulsive buying disorderCompulsive buying disorder Problem / pathological gamblingProblem / pathological gambling AlcoholismAlcoholism Substance abuseSubstance abuse

What is Debt?What is Debt? Broad definitionBroad definition

A promise to pay tomorrow, for a A promise to pay tomorrow, for a consumption made todayconsumption made today

Core: Core: FutureFuture repayment, repayment, presentpresent consumptionconsumption

Underlying Underlying uncertaintyuncertainty many variables many variables involvedinvolved

About the studyAbout the study Targets: enquirers of the “Healthy Targets: enquirers of the “Healthy

Budgeting- Family Counseling Budgeting- Family Counseling Programme” , by Tung Wah Group of Programme” , by Tung Wah Group of Hospitals (TWGHs) Hospitals (TWGHs)

783 subjects were recruited from 783 subjects were recruited from Oct., 02 – Feb., 03Oct., 02 – Feb., 03

Distribution of enquirers by Distribution of enquirers by sexsex

52.0%48.0%

Male Female

Age profile of enquirersAge profile of enquirers

1%

19%

37%33%

10%

0%

23%

43%

28%

6%

0%

10%

20%

30%

40%

50%

Below 20 20 - 29 30 - 39 40 - 49 50 - 59

Male Female

Marital status of enquirersMarital status of enquirers

32%

60%

8%

1%

32%

50%

17%

1%0%

10%

20%

30%

40%

50%

60%

70%

Single Married Divorced or separated Widow/widower

Male Female

Percentage of enquirers by Percentage of enquirers by total amount of debttotal amount of debt

16%

29%

20%17%

10% 9%

0%

10%

20%

30%

40%

Below$100,000

$100,000-$199,000

$200,000-$299,000

$300,000-$499,000

$500,000-$999,000

$1 million orabove

Number of credit cards with Number of credit cards with outstanding loansoutstanding loans

3%

11%

17%

13%

10% 10%8%

7%

3%

13%

0%

5%

10%

15%

20%

One Two Three Four Five Six Seven Eight Nine Ten orabove

Main reasons of Main reasons of indebtednessindebtedness

3%

19%

10%

18%

18%

17%

11%

11%

11%

3%

0% 10% 20% 30%

Household expenses exceeds income

Unemployment

Unemployment of spouse

Investment losses

Need cash for friends/relatives

Poor financial management

Business losses

Job change, reducing income

Gambling

Need cash for medical expenses

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

Views of those who had Views of those who had thought about committing thought about committing

suicidesuicide

2% 7%

18%

71%

68%

16%

37%

3%

19%

16%

10%

8%

45%26%

90%

23%

56%

2% 14%

32%

11%

21%

0% 20% 40% 60% 80% 100%

Think about death

Think about committing suicide

Family members would behappy if they die

Commit suicide if know themethod

Bring family members togetherin committing suicide

Worry about family members ifthey die

Never Seldom Sometimes Often

Characteristics Suicidal ideation

Non-suicidal ideation

p-value

Respondent’s Sex Male 42.6 54.3 0.01 Female 57.4 45.7

Total amount of debt (ten thousand)

Mean 50.40 41.14 0.44SD 97.02 129.07

No. of credit card with outstanding loan

Mean 6.29 5.30 0.01SD 4.21 3.58

Amount of credit card debt (ten thousand)

Mean 19.12 16.14 0.060.06SD 19.59 15.46

Impact of indebtedness Suicidal ideation

Non-suicidal ideation

p-value　

Stalking 55.97 27.82 0.00

Impact of indebtedness Suicidal ideation

Non-suicidal ideation

p-value　

Aspects most affected 0.00

Work performance 19.51 18.39

Family relationship 41.46 30.38

Social activities 5.69 5.42

Self-confidence 33.33 27.59

Not affected 0.00 18.23

Total 100.00 100.00

Impact on physical health Suicidal ideation

Non-suicidal ideation

p-value　

Insomnia 79.41 44.05 0.00

Headache 64.71 33.38 0.00

Muscle pain 19.85 6.18 0.00

Loss of appetite 36.03 8.96 0.00

Feeling tired 44.12 17.00 0.00

Dependent on alcohol and drug 11.76 2.47 0.00

Impact on mental health Suicidal ideation

Non-suicidal ideation

p-value　

could not concentrate 54.41 31.84 0.00

Nervous 72.06 61.98 0.02

Frighten 49.26 38.79 0.03

feeling agitated 47.79 43.74 0.39

depressed 63.97 28.13 0.00

RecommendationsRecommendations Debt CounselingDebt Counseling

Retain workforceRetain workforce Restore repayment capability/motivationRestore repayment capability/motivation Reduce family stress/tragediesReduce family stress/tragedies

1. Debt Counseling1. Debt Counseling Three strategies:Three strategies:

1.1. Debt avoidanceDebt avoidance2.2. Debt repaymentDebt repayment3.3. Coping with debtCoping with debt

Debt avoidanceDebt avoidance Increase protection over high-risk individuals Increase protection over high-risk individuals

(children of debtors, problem gamblers, (children of debtors, problem gamblers, individuals with addicted behaviors) individuals with addicted behaviors)

Skills and assistance in financial Skills and assistance in financial managementmanagement

Value “saving for a rainy day” Value “saving for a rainy day” 未雨綢繆 未雨綢繆 over over “spending future money” “spending future money” 先洗未來錢先洗未來錢

Speculative behavior of Hong Kong peopleSpeculative behavior of Hong Kong people Recognizing the reality of potential debt from Recognizing the reality of potential debt from

the status symbol (the gold credit card, the the status symbol (the gold credit card, the prestigious store charge card)prestigious store charge card)

Debt repaymentDebt repayment Amount of credit line usedAmount of credit line used

Formal Formal InformalInformal

Assessment of individual and Assessment of individual and Family Repayment CapacityFamily Repayment Capacity Prioritizing the debtsPrioritizing the debts Improve communication, show effort in payingImprove communication, show effort in paying

Encourage the borrower to respond rather than keeping their heads low Encourage the borrower to respond rather than keeping their heads low (typical behavior which tends to lead to more aggressive collection (typical behavior which tends to lead to more aggressive collection method)method)

Reduce debt/income ratio – avoid incurring new debtsReduce debt/income ratio – avoid incurring new debts Re-asses repayment periodRe-asses repayment period

Coping with DebtCoping with Debt Build / improve / restore resilience in debtors and Build / improve / restore resilience in debtors and

high risk individualshigh risk individuals Ability to cope with significant adversity: Problem-solving skills, Ability to cope with significant adversity: Problem-solving skills,

Social competence (flexibility, communication), Autonomy (self-Social competence (flexibility, communication), Autonomy (self-efficacy and self control), a sense of purpose and future (success efficacy and self control), a sense of purpose and future (success orientation, motivation and optimism)orientation, motivation and optimism)

Improve social integration of debtors, in particular Improve social integration of debtors, in particular their relationship with their family and significant their relationship with their family and significant social nucleussocial nucleus Alleviate stress, even provide financial safety net for debtorsAlleviate stress, even provide financial safety net for debtors

2.Low Income Families Deserve Attention

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

3.Cross Sector CollaborationCreditor Market Information

Debt Relief

Arrangement

Financial

PlanningFamily Casework

Budgeting Education

Families-in-debt

Wish you …Wish you … Free of debtFree of debt Free of interpersonal debtFree of interpersonal debt

Thank YouThank You