6 ways debt can wreak havoc with your emotions - KXLT - Fox 47 Rochester MN News, Weather, Sports #rochmn

6 ways debt can wreak havoc with your emotions

© iStockphoto / Ron Bailey © iStockphoto / Ron Bailey

By Andrew Housser

The average U.S. household has debt – a lot of debt. Each owes more than $132,000, including mortgages. About 40 percent of households have credit card debt, although many pay their bill in full each month. For those who carry a credit card balance from month to month, however, the average balance on their credit cards is more than $16,000. The interest on that debt costs as much as $1,300 per household per year.

If you are among those carrying the burden of debt – or are feeling stress just reading these facts – there is good news. Understanding common emotions and actions surrounding debt, and the positive responses you can take, will help you improve and maintain financial and mental health.

Powerlessness. If you have a large amount of debt, you may feel powerless. For example, if you graduate from college with significant student loans but little income to repay them, you may have a crippling sense that you will never escape your debt. The best way to fight back? Take control. Live as frugally as possible for a few years while devoting every spare dime to repaying those loans. Knowing that you are taking charge will help return your sense of power – not to mention eliminate your debt.

Anxiety and fear. Debt can make you anxious. To combat the feeling, be proactive. For example, set up automatic minimum payments to avoid late payments. Put credit cards away temporarily. If necessary, store the cards in a safe deposit box or freeze them in a container of water. (Do not close the accounts, though; doing so can lower credit scores.)

Retail cravings. Almost two-thirds of women and 40 percent of men have spent money to improve their mood, according to research. Remember that sales clerks are not your friends; they are working to make a sale and, in many cases, earn a commission. If you overspend, any euphoria you experience is sure to deflate, and you will be left with the bills to pay. When you crave a spending spree, ask yourself what is really going on. Think of the HALT acronym: Are you hungry, angry, lonely or tired? Then address your real feelings – and keep your credit cards in your wallet.

Lowered defenses. Common wisdom is that people should never grocery shop when they are hungry. Similarly, do not shop (online or at a brick-and-mortar store) when your defenses are low. Lowered defenses might be caused by anything from having a couple of glasses of wine to battling a cold. Be smart about your actions. Exercise caution if attending events such as house parties where you are asked to buy something after snacks and drinks have been served. To resist online impulse buys, delete credit card information stored on your computer and mobile devices.

Celebration. When it comes to the risk of debt, feeling overly happy can be as dangerous as feeling down. A classic symptom of some mental health conditions is splurging financially. In the media, it is common to see pictures of stars and athletes celebrating with luxury cars, glamorous nightclubs and expensive drinks. A healthier way to celebrate good news is to enjoy time, and a small treat, with the people who matter most to you. Put any financial windfall toward your debt or into savings.

PTSD-like symptoms. A recent survey found that one in four people who are in debt have symptoms similar to post-traumatic stress disorder, or PTSD. That number is even higher for millennials. Among people age 18-34 who are in debt, 36 percent suffer. Symptoms can include denial, avoidance (such as not paying bills), hypervigilance (such as worrying about becoming homeless due to debt) and nightmares. To cope with these feelings, try calming techniques such as exercise, meditation or counseling.

If you are still struggling after you re-evaluate how you deal with debt, you might need professional help. Fortunately, expert advisers can help you resolve your debt problems. These professionals may advise credit counseling, debt negotiation, or debt consolidation, possibly in the way of a personal loan. One place to find a firm that can help is among the members of the American Fair Credit Council (AFCC).

Andrew Housser is a co-founder and CEO of Bills.com, a free one-stop online portal where consumers can educate themselves about personal finance issues and compare financial products and services. He also is co-CEO of Freedom Financial Network, LLC providing comprehensive consumer credit advocacy and debt relief services. Housser holds a Master of Business Administration degree from Stanford University and Bachelor of Arts degree from Dartmouth College.
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