The Psychology of Debt
Has this happened to you?
You work hard to clear one of your pesky debts, and then just a few months later you find yourself in the same position - back in debt?
You’re not alone. Debt is a cycle that tends to repeat itself unless you approach it differently.
The psychology behind debt is more simple than you might think.
When it’s related to consumerism (spending too much on materialistic things), it’s almost always driven by consciously or subconsciously trying to fill an underlying void; self-esteem, loneliness, anxiety or sadness. The hard part here is coming to terms with what that void really is.
And, the only way to truly unpack that, is to take a bit of time to understand what’s going on for you, and in your life. Once you understand what’s driving you to spend, you can replace those poor spending habits with something healthy like playing with your toddler, going for a walk, shutting down your computer before getting to the digital checkout of your favourite store, stopping yourself from making comparisons to others and so on.
The idea is that when you have the opportunity to control your spending through better choices, you’ll want to take control. And, the first step to taking control is being totally present, and mindful of what really is a necessary expenditure and what’s simply an emotional non-essential purchase. If you avoid the latter, you’ll stop accumulating more debt, and can actually start to tackle the full balance.
When debt is related to something that’s out of your control, such as unexpected job loss, illness or divorce, it can feel very heavy and like you don’t have many options. But, you do. The first step is to acknowledge where you are today - what do you owe and to whom. Then, do everything you can to park your emotions around why this has happened to you, so that you can focus on the task at hand; getting rid of the debt. Whatever you do, know that the part you can control is getting rid of it.
Whether your debt was caused by you, or happened to you, follow a systematic approach to your debt reduction and don’t be afraid to reach out to a professional to help if you’re not clear about the best way to pay it off.
