How to stop worrying about debt
Why you should NEVER stress about defaulted debt
"I just want it gone"; "It's stressing me out".
What is it about debt, specifically defaulted unsecured debt, that affects so many people mentally and emotionally?
Most people we speak to who have defaulted on their unsecured debt are focused solely on finding a way to clear the debt. When we ask why? The responses are something like the above.
The truth is, it’s not the debt that is the issue. It's the person's mindset and emotional relationship with debt that truly requires focus to help manage the situation optimally.
Let The Real Debt Guy explain...
Your relationship with debt
If you’re stressed and worried about your defaulted unsecured debt, it's important to understand that your mind creates and controls your feelings. They are not shared by others, especially not your creditor.
If you don’t believe this, try calling your creditor stating just your name and no other details. The representative would have no idea who you are, so they will ask for an account number instead. Once received, you will be asked to wait whilst they find out who you are and why you may be calling. That same representative won’t leave work and spend hours discussing your credit card debt.
The CEO of Barclays PLC will not walk into the office on Monday and ask his PA whether you have paid your credit card bill or not.
So, this means the only person being emotionally and mentally affected by the debt is… You.
Fun fact: Apple has over 104 billion dollars worth of debt. Have you ever heard any of its CEOs step down because of the stress related to Apple’s debt level?
Treat your Token Payments like your phone bill
If you have followed our “Token Payment Method” and read our article Why do debt collectors offer discounts? You may be anxiously waiting for the right offer to settle the debt at a discounted sum. You wait and wait until your emotions get the better of you, so you send an offer to the creditor or debt collector. Your offer gets countered with a much higher settlement amount.
“Maybe I should try and raise the money to settle this debt?” you think to yourself.
Stop! Why would that be at the forefront of your mind?
Now, this is where mindset comes into play.
Do you have a phone contract? If your answer is yes, think about how much you are paying per month towards it. It’s usually around £35 per month, whilst your monthly token payments are as low as £1 per month (£12 per year).
Now ask yourself how you cope mentally and emotionally with £35 per month when £1 per month affects you so much that you’re willing to try and raise money you don’t have to clear the debt.
Take a moment to let that register.
Cui Bono
If you are a person who wants to clear your defaulted debt, then you must consider the term “cui bono,” which, translated from Latin, means to whom is it a benefit? The answer should always be… Me.
If a relative is offering the amount you need to clear the debt, for example, which will result in you successfully obtaining a mortgage for a property, that could make sense; you will benefit.
If your reason is “I just want it gone," it may benefit you mentally or emotionally in the short run, but how will you manage your emotional and mental well-being in the future? How will you cope with priority debts like council tax, utility bills, etc? How does it benefit you financially?
Finance is a subject that requires you to try and manage your emotions and take a business-like (logical) approach to decision-making. Guess what? This is what this article and this site are designed to help you with.
We got you!
Don't forget to read The Real Debt Guy's final thoughts below!
The Real Debt Guy is a qualified financial adviser and a UK debt expert. The information in this article is considered to be true and correct at the publication date.
