Ian is 48 years old and lives in a 120 year old home in a Melbourne suburb. He is very proud of his home and its historical significance and wants to do everything in his power to keep it. Prior to being retrenched Ian claims he had his finances under control, paying his bills and credit card on time and keeping up with loan payments for his car and his mortgage.
In May 2008 Ian was retrenched from his long-term employer. Initially he wasn’t eligible for unemployment benefits because he was deemed to have liquid assets (around $12,000 in shares). He started to sell the shares and, for a period, lived off this money while looking for work.
The money from his shares is now all spent, he still owes money on his car, and is struggling to hold onto the home he loves.
He negotiated a three-month moratorium hardship variation with his bank for his mortgage thinking he would find a job before long and catch up the missed payments. Ian is yet to find other employment
Ian has done everything he can to reduce his spending — driving less, seldom eating out, and buying less food. He never buys the gourmet foods he enjoyed in the past, and missed meals completely on occasions because he simply couldn’t afford it.
When it got to the stage that he started borrowing money from his father who was on the aged pension Ian realised his finances had got completely out of hand. He tried to get an appointment with a debt management agency, but they refused to see him because he had no income.
Ian made an appointment with a financial counsellor who suggested he apply for early release of his superannuation to cover the mortgage payments. Ian was reluctant to use his retirement money but decided he was prepared to do that rather than risk losing his house. He also believed that doing so would reduce his stress levels and help him in his search for a new job.