How Debt Can Affect Mental Health

Dealing with lots of debt can be incredibly stressful. Bills keep coming despite attempts to pay them down, interest on the debt continues to grow and calls from creditors and collection agencies can drastically increase anxiety. For some of us, it feels like we are gerbils on a revolving wheel, going round and round with no way to escape.

This can be quite detrimental to our mental health. Debt pressures can often lead to depression and anxiety, as well as feelings of resentment, denial, anger, and frustration. People who struggle with debt often have difficulty focusing on work tasks, may not be able to asleep, eat a healthy diet, find the time and energy to exercise, or have any desire to socialize with friends and family. All of this can be overwhelming.

The good news? In many cases, improving your financial situation can help to dramatically improve your mental well-being as well. Here are some tips that might help you:

One of the most difficult parts of dealing with debt is that bills quickly become overwhelming. You can get ahead of this problem by organizing your finances. The first step? Track down all your bills and relevant paperwork together.

As you are tracking down all that paperwork it is understandable your first instinct might be to “hide” from the debt. But hiding will not help you resolve the problem and will not improve your situation. Understanding the enormity of your debt will make it possible for you to create a financial plan.

Once you understand your debt, you will be able to create a financial plan for dealing with it. The first step is to note all the due dates for your bills, either in a spreadsheet on your computer or with a pen and a pad of paper. It is important not to miss any payments if possible. Not only do missed payments hurt your credit rating, but most creditors charge penalties for late or missed payments (especially utilities, including cable, cellphone, and hydro bills). You do not want to end up paying additional charges on top of what you already owe. Plus, if you do not miss those monthly payments, creditors will not have collection agents calling you. None of us want to deal with collection agencies.

Once you know when all your bills are due and you have noted them, then it is time to create a plan to pay them on time. Make sure you put a category in your budget for “debt repayment” and make it a priority to “pay” into this category each month to pay down your debt as quickly as you can. If you can shave your monthly expenses (such as groceries, restaurants, clothing, and other more flexible expenses) you should be able to find some spare money in your budget for debt repayment.
Having a workable, sustainable budget that you can use to track your spending and your bill payments will not just help you reduce your debt, it will also help you feel more in control of your financial life. This can go a long way to helping to ease your stress and anxiety level.

Give yourself realistic goals. For example, tell yourself that you want to pay more than the minimum balance on your credit cards. If you successfully pay a little bit more of your card balance for a span of three months, you have achieved a solid goal. You can reward yourself (for example, a special drink at your favorite coffee shop or a visit to the local movie theatre). This can keep you feeling motivated and upbeat and give you a sense of real accomplishment.

Sometimes, dealing with financial issues requires help. Consider talking to friends, family, or financial professionals for guidance. The Licensed Insolvency Trustees at Farber can help you understand the financial options available to you so you can deal with your debt without further pressure. If you want to talk to us, please CLICK ON THE FREE CONSULTATION BUTTON, below, or give us a telephone call today. We are here to advise you.

And, while debt and mental health issues often go together, they can also exist independently of each other. For example, in some cases, once the debt has been repaid, a person feels great relief and a sense of accomplishment that improves their mood. But some people continue to experience issues such as depression or anxiety after their debt pressures are resolved. If that is the case, obtaining mental health support from a qualified professional could be a promising idea. Therapists and medical professionals are trained to help with these sorts of issues. Do not be afraid to reach out to them for help.