IVAs And Relationships – How Are They Affected?

While your Insolvency Practitioner can ensure the IVA will effectively sort out your financial issues, you might have to recognise and work on the impact an IVA could have on the relationships in your life. Living and working with someone who is in serious financial trouble can be incredibly difficult, especially if you have been trying to pretend everything is ok.


Because IVAs are specific to an individual, when one partner has one the other can end up feeling the strain. One half of the relationship is on a strict budget, the other isn’t. The latter may feel pressure to pay for luxuries like holidays, Christmas and birthdays, and the latest technologies that otherwise wouldn’t be possible.

There may also be the pressure to help the financially stricken partner by loaning them some money to help pay off their debts, sometimes by transferring cash outright from savings or perhaps buying an asset from the indebted partner. If not handled very carefully it can lead to a lot of resentment.

Then of course if the property is jointly owned, the other partner has to agree to have a restriction put on the deeds by the Land Registry to prevent the property being sold or secured against during the IVA term. Perhaps your other half had plans to move, to downsize or upgrade, even add to your family and an IVA may put those plans on hold. It can all make things a little bit tense between you.


Besides spouses and partners, your children (if you have them) will be the next closest relationship that you need to take care of during your IVA. It can be hard to stick to a budget when you have kids – all sorts of things will crop up on a daily basis that cost money, from school trips to leaving presents for teachers to sweet stands at the checkout. The IVA does allow a reasonable amount of the budget for taking care of children, especially in the early years as it recognized these can be very expensive times.

But when it comes to teenagers, how will you explain to a teen that very expensive gifts and treats for Christmas and birthdays may not sustainable for the next few years when they desperately want to keep up with the latest trends in technology and fashion like their friends?


When it comes to families, your relationship with them during an IVA will often depend on whether you borrowed any money from them and how they feel about that. If they are one of your creditors, you may have no choice in the matter as to whether they know as they will be invited to the creditors meeting if you want to include their debt in your IVA. However, they may not be happy with a proposal that means they will not get back all of the money you have been loaned (most IVAs write off some debt balances at the end of the term). You will have to carefully manage their disappointment if they were expecting to be fully repaid.

Of course some families are the complete opposite and will write off the debt in full before it goes into an IVA. In which case you may be left feeling guilty and still feeling indebted to them.

If they have not lent you money and you do not want them to know about your IVA, you may find difficulties in attending and/or fully taking part in all the family events and traditions that normally occur. Family weddings can be notoriously expensive affairs, especially as weddings abroad are becoming more common, while Christmas gifts may have to be scaled back as will frequent meet ups for lunches, dinners and drinks. And that’s before you take into account Christmas and birthday gifts.


Because of your budget you will not be able to do as many things with them as you could before. If going out and spending a lot in clubs, pubs and restaurants was part of your life with them, they may not understand if you cannot do this as much anymore. You may feel pressured to keep up with the old gang, or even be considered to be spoiling the set up you all had.

Work colleagues

You might think that work is the one place where you can keep costs down, but there is always the pressure to put something in for collections, to contribute to charitable causes and provide acres of sticky buns and cakes on your birthday. Then there are expenses. While reimbursed, you still have to pay for them first before claiming them back and that can be a little awkward if you only have a finite budget to work with.