Money difficulties | 26-year-old Ville tells why more and more young people slip into the spiral of debt in modern Finland

All started with travel fever.

Five years ago Ville was a 21-year-old from Helsinki, who wanted very much to travel with his friends. So passionately that even though Ville had no extra money, he decided to finance the trip with loan money.

He took out a 3,000-euro consumer loan from a financial institution he found online.

“I thought we’d take a bigger sum at once, I’ll be able to pay it because I went to work after all,” says Ville.

“If it had been difficult, I wouldn’t have gone for it. But it was really easy. After I had made the application online, a day passed when the money was already in the account. At that point, I didn’t really understand interest rates, how much they affect and how much the loan has to be repaid.”

After three years, Ville realized that he had drifted like that to serious payment difficulties, that there was not enough money even for food.

Young and the financial and debt problems of young adults have clearly increased in recent years. HS reported at the beginning of July that payment defaults among young people under the age of 20 have also increased.

Read more: Payment defaults among young people under the age of 20 have increased: Some do not even have money for public transport or other basic expenses

CEO of the Guarantee Foundation Juha A. Pantzar told in the story that in addition to low income, there are three main reasons behind the financial problems of people under the age of 29: gambling, the challenges of becoming independent and spending more than one’s real means.

Takuusäätiö is a national social organization that tries to prevent and solve financial and debt problems of private people.

According to Pantzar, young people often postpone debt repayment by taking out more consumer loans. At the same time, they get into more debt, until after a few years the situation becomes impossible.

Thus also happened to the now 26-year-old Ville. Due to the sensitivity of the topic, Ville appears in this interview under an invented name.

When Ville took out his first consumer loan, he worked at the store’s checkout. In time, Ville paid back the loan and stayed on the payment plan. However, the money was spent, and at some point he noticed that the money had run out.

The loan had to be paid, so Ville ended up taking out a new loan: a quick 4,000 euro loan from another financial service in the network. After that, he took another 500 euro quick tip for third place.

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“Practically all the money that came, also went.”

“My money usage didn’t change, even though there was always more to pay every month. I didn’t really budget the money in any way, even though I should have. I continued with the consumption behavior I was used to,” says Ville.

Willen the economy became tangled and ever-tightening. He tried to manage his finances with various arrangements, postponing the payment of bills and trying to negotiate with debt collection companies.

“For a while, I was able to spin the roulette so that the payments stayed more or less on schedule. Until at some point the situation came that the money was no longer enough to pay all the installments.”

When Ville woke up to the seriousness of his payment difficulties, he became anxious. Hobbies and friends remained. Had trouble sleeping. Ville was on sick leave at any time for any reason, but he did not talk about anxiety and depression in occupational health care.

“I was in such a shame trap. It seemed like too big a deal to admit to someone and to yourself that you are not able to manage your affairs financially. It was a difficult time,” says Ville.

“That hole got deeper, and at some point a wall just stood up.”

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“At some point, the wall just went up.”

Ville was 24 years old when he called his mother and told her about his plight. Mother listened and asked. He gave Ville money to take care of acute bills, and they went to the bank together to discuss Ville’s financial affairs.

The debt amount had grown to 10,000 euros. The last quick tip of 500 euros had time to go into foreclosure. As a result, Ville received a non-payment notice and a bill of more than 2,000 euros with interest and collection costs.

From the bank, Ville got a loan and a repayment plan, with which he was able to pay off his debts. The mother became the guarantor of the bank loan.

“The relief was huge. Even at that stage, it was a lot easier when I could tell the parents about it. And when I got things organized, I felt really good,” says Ville.

“Fortunately, I have always had a good relationship with my parents, especially my mother, because I have lived with her for a large part of my childhood. I was in a lucky position in that way, that there was a support network that I could rely on.”

Now Ville has got his life and finances back on track. He lives with his girlfriend in Kouvola. He has a new, meaningful and better-paid job there.

Ville pays back the bank loan as planned for a few years. There is money left for living and saving.

Through problems, Ville learned a lot about everyday money management and the basics of managing finances.

“When I moved in on my own, I was pretty much completely clueless when it came to financial knowledge. Everything was new. In practice, all the money that came in also went out. There were no savings. There was no information about how loan application processes are done in the bank and how they are done in such online services. There was no idea of ​​a reasonable interest rate,” he says.

Ville has also changed his consumption behavior. He doesn’t buy every thing that comes to mind, but evaluates whether he really wants and needs it. In the midst of problems, he used to buy something nice just to make himself feel better for a moment.

Ville is concerned about the increase in payment difficulties among young people and the fact that not everyone necessarily has a support network like he does. He encourages talking about difficulties, even to someone.

He also hopes that young people would also receive more education and guidance related to money matters. In middle school, things related to finances are taught, but in Ville’s opinion, it is necessary to learn a lot even when you are older.

“That’s what you think you’re really grown up at 18, and the idea only gets stronger when you’re in your twenties. Although the fact is that he is really still very inexperienced in such matters.”