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6 tips for dealing with debt stress


Published: 12 October 2011

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Financial worries and debt are common causes of stress and, if left unchecked, can lead to a variety of problems, including depression, a breakdown in relationships and anxiety, say experts.


However, by taking action against your debt, you can help keep money worries from taking over your life. Here's how to take control of your financial future and reduce your stress.

1. Be honest and accept your debt.
The first thing you need to do in order to tackle your debt and the money worries it brings you is to accept that you have debt.

Before you are able to regain control of your finances and start on your road to recovery, you need to open up and accept that your debt is a problem. More often than not, debt creeps up on people over a long period of time and a few small slips can easily escalate into something more serious.

2. Know that you're not alone.
Nearly half of UK consumers are concerned about their debt, according to a recent study by the trade body for insolvency professionals, R3 -- a 7% increase from last year. Credit card debt seems to be the biggest cause for concern, with 53% reporting particular concern over their credit cards.

If you're currently battling significant debt, don't be too hard on yourself. Many Britons are dealing with the same thing.   

3. Seek advice.
There are numerous charities and government bodies that provide individuals with free debt advice. If you would like to speak to a professional  about how to move forward, ensure that the counsellor  is with a registered charity and be wary of companies asking for a fee.

Contact the Citizens Advice Bureau or Consumer Credit Counselling Service (CCCS). They can provide tailored advice whilst allowing you to remain anonymous.

4. Speak to your creditors.
They may be willing to set up a payment plan or reduced monthly payments if you inform them of your financial situation.


Ignoring your creditors, in contrast, will only encourage them to continue hounding you for payments.

Speak to your creditors sooner rather than later. That way, you are more likely to come to an arrangement that will allow you to start paying back what you owe.

5.Create an action plan and a budget.
In order to know how much you can pay towards your debts each month, you need to draw up a budget. This will let you know what your income and outgoings are so you can create a plan to pay off your debts. The Citizens Advice Bureau offers a step-by-step guide and budget sheet to help you do this.

If you do not have enough money coming in to cover your outgoings, you have two options. You can either reduce the amount going out or increase the amount coming in. This means that you might have to cut back on some luxuries, reduce the cost of your day-to-day living or find another source of income, such as a  second job or additional state benefits.

By talking to a credit counsellor at a charity such as Citizens Advice or CCCS, you might find that you are eligible to receive benefits, such as tax credits or a council tax benefit. Once you know how you are going to fund paying off your debts, you can start working towards reducing them.

6. Tackle your debt stress.
Now that have accepted your debt and started on a route out of it, you need to consider how your money worries have impacted your mental health. Becoming stressed or depressed about your financial situation is normal. However, there are actions you can take to help you stay calm and relax in a difficult environment. 

  • Make your health a priority. Eating a healthy and balanced diet will ensure that your body and your mind are able to function properly, whilst doing exercise can release endorphins and keep you socialising. Professor David Richards, from mental health services research at the University of Exeter, suggests that people with money worries get moving in order help relieve stress. "Take up some type of exercise," suggested Richards in an interview with NHS choices. "It can improve your mood if you're feeling low."
  • Keep a routine. If you are unemployed or have been made redundant, it can be very easy to slip out of a routine and spend the day watching TV in your pyjamas. However, it is important that you keep to your normal routine as much as possible. Get up at the same time, get dressed and ensure you eat properly at meal times.
  • Stay in control. Once you have developed an action plan and budget to help you get out of your credit card debt and avoid debt stress, stay on track. Try to avoid thinking about what a big mess you are in, or having negative thoughts about how  you will be stuck in debt. You have taken huge steps in regaining control of your life and finances, so stay positive as you continue on your road to financial recovery.

See related: Worst consequences of recession 'still to come'; Study: Debt boosts young people's self-esteem

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