Debt affects more than just our financial well-being; having money problems can also affect our physical and emotional health, which is why it’s important that we understand how to deal with debt stress.
Debt and stress often go hand-in-hand. When we’ve fallen behind on our payments and our creditors begin calling, it’s common to get overwhelmed with worry as we start wondering whether we’ll ever get our finances back on track.
If you’ve found yourself overcome with debt-related stress, below are some strategies you can use to help you deal with debt stress and get debt relief.
“Debt Stress Syndrome”: How Debt Can Cause Health Problems
Difficulty concentrating, sleepless nights, and a change in eating habits are just a few physical symptoms in which debt stress can manifest, and this phenomenon has given rise to what is often referred to in medical circles as “debt stress syndrome.” Researchers have documented the health effects of debt, and unsurprisingly, studies show that having money problems can increase your stress levels and affect your health.
If you’ve been struggling with your finances for months or even years, this level of prolonged stress has often been linked to high blood pressure, elevated cholesterol levels, diabetes, and obesity. Putting yourself under tremendous amounts of pressure can also lead to a compromised immune system, which can make you more susceptible to illnesses.
In addition to our physical health, debt stress can also affect our mental and emotional health. In 2014 a team of Finnish researchers conducted a review which showed that individuals dealing with debt suffered from depression more often than those who were financially free. And, a 2012 research study from the University of Nottingham also showed the correlation between debt and stress. The study found that those who struggled with their finances were more than twice as likely to experience a host of mental health problems, including depression, suicidal ideation and anxiety.
Debt stress can cause health problems and affect our personal and professional life, and it’s for this reason that debt stress is something that must be acknowledged and addressed. Here are five things that can help you get your finances under control, and get debt stress relief.
1) Face Your Money Problems Head On
If you’re experiencing stress from your debt, the first step towards finding a solution is to acknowledge your money problems head on. It’s certainly easier to bury your head in the sand and pretend that everything is going swimmingly, but if you continue to ignore your escalating financial woes, you’ll only be setting yourself up for more stressful situations.
Be honest with yourself in terms of how much you owe and to whom. This honesty applies more than just to yourself; it also applies to your partner, your family and those closest to you. If you are dishonest with your partner and with your family about your spending habits and your current financial situation, it could cause tension in your relationship, which will further add to your stress.
When you’re ready, go through your financial paperwork and start putting together a list of all your creditors, and how much you owe each of them. You may be surprised by how much you’ll end up owing, but take a deep breath and know that you’ve just taken the first step towards clearing your debts and relieving stress.
2) Make a Plan to Pay Off Debt
Once you know how much you owe and to whom, you’ll be in a better position to make a plan to pay off debt. Creating a plan to eliminate your debt will help ease the mental and emotional burden, while also giving you the hope and motivation you need to become financially free. With a plan in place, you’ll feel an immense sense of relief knowing that there is a light at the end of the tunnel, and that you’re taking the necessary steps to reach it.
The first thing you should do is to prioritize your debts in order of importance. Priorities will be different for everyone, so it’s important for you to decide which debt you want to pay off completely first. Then, you can put together a budget, which we’ve explained in depth here.
A budget ensures you’re living within your means, and it will also give you a set timeline on when you can expect to become debt-free. This interactive, budget calculator spreadsheet will help make the budgeting process less painful. If your income isn’t enough to cover all your expenses, you’ll have to make some adjustments to your budget. This is something a credit counsellor can help you with.
Now that you know how much money you have to work with, you can start paying off your debts strategically. Some people believe that the best way to pay off debt is to make the minimum payments required on your debts with the lowest interest rates, and to maximize your payments on the debts with the highest interest rates. Once a debt has been paid off completely, use this extra money to pay down the debt with the next highest interest rate. Or if you prefer, you can try a more psychologically motivating approach.
An accredited, non-profit credit counsellor can also help you make a plan to pay down your debts, which we’ll discuss a bit further down in this article.
3) Identify Your Spending Habits and Make Changes
There are different ways we cope with debt stress, and one of the most common ways people comfort themselves during stressful times is to indulge in retail therapy. Studies have shown that the more overwhelmed we are, the more likely we are to buy something to make ourselves feel better. Although buying something nice for ourselves may relieve stress in the short-term, this feeling of elation is only temporary. If this mindless spending continues, it will unquestionably lead to more money problems, which will bring on additional stress in the long term.
If you want to reduce your stress level, it’s time to take an honest look at your spending habits so you can identify if you are an emotional spender. If you tend to reach for your credit card each time you’re feeling blue, there are healthier ways you can manage and spend your money, which will have the added benefit of keeping your debt stress levels in check.
So the next time you feel inclined to spend money you don’t have, pay attention to your emotional drivers. If you’re feeling anxious, avoid going to the mall and hit the gym to work off any tension. If you’re upset, skip the online shopping and call a close friend to talk about whatever is bothering you. If you pay attention to your emotional drivers, you can make more conscious choices that will allow you to save money and keep debt stress at bay.
4) Take Care of Yourself
When we’re overcome with worry or anxiety, our usual tendency is to put our personal needs on the back burner as we devote all our time and energy on finding a solution to our problems. Although working towards a solution is an important part of overcoming debt stress, it’s just as important that we don’t neglect our health.
When you’re in a tough financial spot, make sure you take some time to relax, enjoy yourself, and do what you can to take your mind off the problems weighing you down. If you’re on a limited budget, it may not be possible to take up a new hobby or to go away on a weekend retreat, but there are many alternatives you can enjoy that won’t cost you money.
For example, small daily rituals – like meditating every morning, soaking in a hot bath on Sunday nights, taking a walk after dinner – can make a world of difference in lowering your stress levels. If there’s an activity that you enjoy, set aside some time to do it. You’ll get bonus points if those activities rejuvenate your mind and body.
Many of us have fallen into challenging financial situations, and it’s important that you don’t beat yourself up for it. Being in debt is already a stressful situation in itself, and if you continue to berate and punish yourself for your past financial choices, you’re only making a tough situation even more difficult. The good news is that debt stress can be managed through strategies such as moderate exercise, plenty of down time, and a nourishing diet. So, start taking steps to take care of yourself. You’ll be surprised by how a few lifestyle tweaks can make you feel so much better! Here are some stress relief tips you can try incorporating into your daily routine.
5) Get Debt Help From a Non-Profit Credit Counselling Service
Debt is a topic many of us aren’t comfortable discussing, so we tend to keep our struggles to ourselves and bear the burden on our own. And, this results in a constant state of worry and fear, which can affect our health, relationships, job performance, and how we function in our day-to-day lives.
When people are under stress, they often turn to a physician, or even a psychiatrist, for help. But when the cause of your worry or anxiety stems from financial problems, getting help may not seem as easy. However, what many people aren’t aware of is that you can get debt help through a non-profit credit counselling service.
If you have money problems and you’ve been dealing with debt stress for some time, calling an accredited, non-profit credit counselling society is the best thing you can do for yourself, and for your finances. A credit counsellor will thoroughly go through your finances, help you put together a budget, and they will also provide you with a list of options that can help you get your finances back on track, all at no cost to you.
With a plan in place, you’ll feel a tremendous sense of relief knowing that you’re well on your way to becoming financially free. If you’d like to make an appointment to speak with one of our counsellors, you can give us a call, and one of our client care specialists will be happy to assist you.
It’s Important to Know How to Deal With Debt Stress Before It Gets Out of Hand
When our finances take a turn for the worse, our personal and professional lives can easily follow suit unless we know how to deal with debt stress. Ignoring our financial problems may seem like a painless thing to do, but by doing so we’ll only be prolonging – and worsening – our financial problems.
Debt does more than limit your financial freedom; the constant worry and fear about the state of our finances also puts a strain on our mental, emotional and physical health. If your financial worries are impacting your health, consider meeting with an accredited, non-profit credit counsellor.
A credit counsellor can help you put together a workable budget, restructure your debts so your monthly payments are at a manageable level, and direct you towards tools and resources to help you get your finances under control. You won’t become debt-free immediately, but knowing that you have a plan in place will do wonders to help you ease your debt stress.
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The sooner you start dealing with your debt, the sooner you see an improvement in your credit report If you need some help getting started with a plan, or if you’re not sure if your budget is realistic, contact a non-profit credit counsellor for free, confidential help. Typically, the earlier you contact us, the more options you’ll have.