The mental, emotional, and financial strain of living with debt can make you feel trapped and hopeless. You really see no end in sight. Debt is often associated with a constant stream of decisions and mental calculations. Such as what bills to pay first, how to prioritize different types of debt, and which loans to consolidate or refinance. All of these decisions that are part of living with debt can be exhausting. The emotional fatigue that comes with the constant need to manage debt can leave individuals feeling mentally drained.

Debt and your health

When you are living with debt what you can find is that interest fees tend to be eating into the monthly budget, preventing any significant progress of debt repayment being made. So even with the best of intentions it feels like the debt is a heavy burden to bear. Throw in missed payments and late fees and the problem adds even more anxiety and sleepless nights.

The ongoing worry over finances triggers the body’s “fight or flight” response, releasing stress hormones like cortisol and adrenaline. When your feeling like that you may unwise choices, like eat unhealthy foods, smoking or drinking alcohol to feel better.

Additionally, financial stress can lead to a range of digestive issues, including acid reflux, stomach ulcers, irritable bowel syndrome (IBS), and nausea.

How To Get On Top Of Your Debt

There are a few ways you try and regain control over debt.

Create a Budget

A detailed budget can help you track your spending, identify areas where you can cut back, and create a plan for paying off debt.

Seek Professional Help

Credit counselors, financial advisors, and debt management programs can help you living with debt and create a feasible repayment plan.

Prioritize Your Debt

Focus on paying off high-interest debt first while continuing to make minimum payments on other accounts.

Build an Emergency Fund

Creating a small emergency fund can help protect you from unexpected expenses, preventing you from falling back into debt. You can do this by reducing your expenses.

Communicate with Creditors

If you’re struggling, reach out to creditors to negotiate lower payments, extend due dates, or discuss other forms of relief. An IVA (Individual Voluntary Arrangement) allows individuals struggling with debt to come to an agreement with their creditors to pay back a portion of their debt over a set period, typically five years, without facing bankruptcy.

Why should you try and avoid bankruptcy?

Bankruptcy is a last resort, that should be avoided wherever possible. The reasons for this are that it can impact your credit rating and limit your options to lend in the future. There is also stigma attached with going bankrupt especially as it is on a public record that others can see. I briefly worked at a estate agents and we would do credit searches on all potential interested parties. It’s much better if you can work with creditors to avoid bankruptcy and look for an alternative that wouldn’t have such a severe impact on your credit rating such as an IVA. Plus, with bankruptcy you might also have to sell your assets, such as your car and home.