Why Dealing with Debt Isn’t as Scary as You Think

It’s no secret that unpaid debt can be stressful, embarrassing, and scary. People are often ashamed to talk about financial troubles, especially if they’re dealing with unpaid credit card bills or missed mortgage payments. Left unattended for too long, the total amount of debt can reach an unpayable level—leaving people looking for debt relief. 

If you have unpaid debts, even if you have missed payments, you don’t have to be afraid—facing debt head-on and taking proactive steps could lead to better results in your personal finances. 

Let’s explore how you could find relief by tackling your debts as soon as possible. 

Why Debt Feels Scary 

It’s totally understandable to feel strong emotions about debt. Debt is a financial problem, but it can cause emotional and psychological challenges, too. When you’re struggling to pay debts, it’s common to feel emotions like stress, anxiety, and shame. Some people might have trouble sleeping because of debt, or might feel a lower sense of self-esteem that can cause them to miss out on opportunities for the future. Some people in debt might even feel afraid of losing fundamental necessities of life, like their car, or even the roof over their head. 

It’s easy to feel strong emotions about debt. But there’s a useful saying some therapists offer: “Feelings aren’t facts.” Just because you feel scared about debt, that doesn’t mean the facts of your life have to be determined by those negative feelings. 

Having debt doesn’t mean you deserve to be treated as an untrustworthy, less-valuable person.

Having debt doesn’t mean you deserve to feel shame. 

Having debt doesn’t automatically mean you’ll lose your home, car, or property. 

Having debt doesn’t mean you have to live in fear. 

Fear and anxiety can be helpful feelings, because they’re the result of your brain trying to keep you safe. But it’s important to try to set those feelings of fear aside and remember: Debt is a problem that can be solved. And debt solutions are often less scary than you might think. 

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3 Reasons Dealing with Debt Is Not that Scary

At first, debt may seem frightening to even think about. It doesn’t feel good to get notices in the mail from your credit card company, or watch balances grow as bills go unpaid. You might be tempted to ignore the problem. But debt doesn’t go away on its own. 

If you’re feeling scared about debt, try to gain a fresh point of view about what debt really means. Here are a few key points to keep in mind that can make debt feel less scary: 

• Debt is temporary. Whether it’s an installment loan for a new car that you pay off during the next few years, a zero-interest payment plan for medical bills, or a credit card balance, most debt doesn’t last forever. There are many ways to pay off debt in a way that fits your budget and lets you enjoy life. 

• Debt payments can give you small wins and momentum. You don’t have to pay off all of your debt all at once. One good thing about debt is that it lets you buy time—instead of coming up with a big lump sum to buy a car, or to pay for the vacation you want, or to buy other must-haves for the life you want, debt lets you pay for things over time. If you’re struggling with debt, just aim to make small progress.   

• Debt is a way of borrowing from your future self. If your income goes up in the future, or your financial situation improves in other ways (like other loans and bills getting paid off or going away), debt can become more manageable. People often say that debt is “borrowing from the future.” Sometimes that’s totally fine, especially if your current budget can fit necessary debt payments in—and your future might be just as bright as you hope, or even brighter than you think. 

• Debt relief is available for many debts. Unsecured personal debts like credit card debts, some medical bills, and some private student loans are often eligible for debt settlement programs. Other creditors and lenders might offer you short-term debt relief like forbearance or deferred payments if you’re having financial hardship. No matter what scary debts you’re dealing with, you don’t have to face them alone. Talk to your lenders and see what help is available. 

When you take the time to think about it in detail, you may realize that dealing with debt isn’t always so bad. 

1. Dealing with debt is nothing to be ashamed of

Debt is as American as apple pie. Americans have lots of debt. It’s likely that many of your friends, family, and neighbors are dealing with debt, just like you are. Americans carry debt from mortgages, auto loans, credit cards, student loans, and more. 

Back in the 19th century, there were debtors’ prisons, and being in more debt than you could handle was seen as immoral, something people should be ashamed of. Not anymore—most Americans today understand that debt isn't good or bad. Debt is just a financial tool. And in some ways, debt powers the economy. 

Getting into trouble with debt isn’t immoral, either. People often find themselves in financial difficulty for reasons beyond their control. Unpaid debts can result from job loss, divorce, loss of a breadwinner, medical bills, or many other unfortunate circumstances that can happen to anyone.

Instead of feeling ashamed about your debt, you can try to put that energy into taking positive steps. Stop beating yourself up, and start beating your debt. 

2. Anyone can tackle debt

You don’t have to earn a lot of money or even be good at math to deal with debt. The most important ingredients are commitment and hard work. A solid strategy for dealing with debt might involve earning a little more, spending a little less, and/or getting professional help. Begin by setting up a budget to figure out where your money really goes each month, and take it from there.

3. It’s easier to get started than you think

No matter how much debt you have or where you are in life, you can work toward becoming debt-free one step at a time. Try these steps for dealing with debt: 

• Look at the big picture. How much unpaid debt do you have, and how much does it cost you per month? 

• Follow an example. Do you know anyone, or have you read about someone in the news or on social media who has paid off debt? What did they do? Can you follow their example? 

• Find the low-hanging fruit. What’s the debt you could pay off the fastest? Sometimes it helps to build momentum by paying off that smallest debt first (the debt snowball). 

• Identify your biggest roadblocks. What’s holding you back from paying off debt? Do you feel overwhelmed, or unsure where to start? 

• Lay out a phased plan. Use a debt payoff calculator to understand how long it may take to pay off the debt. 

• Set expectations. What big changes are you prepared to make to pay off debt? Are you willing to cook all your meals at home for a month? Give up vacations for a year? Sell your car and get a cheaper one? Take in a roommate to save money on rent? Think carefully about what you’re willing to give up today in exchange for a more prosperous, peaceful financial future. 

• Get going. Now it’s time to take action and start dealing with debt. 

How to Stop Panicking About Debt 

Saying “debt doesn’t have to be scary” is one thing. But if you’re struggling with serious debt stress and anxiety, you might need more-concrete help. Here are a few tips to help you stop panicking about debt: 

• Talk to your creditors. If you’re losing sleep about debt and having trouble paying your bills, start by calling your creditors and lenders. Tell them you’re having financial hardship, and ask what they can do to help. They might offer you a forbearance arrangement that can give you a temporary break on your debt payments, helping you buy time and build up some savings. 

• Get mental health help. Talk to your doctor or therapist about debt-related anxiety and stress. If you’re suffering from severe anxiety or depression that’s caused in part by your debt stress, you might be able to get medication or other therapeutic support that can help. 

• Talk to loved ones. Many people with debt feel like they have to bear the burden alone and in secrecy. But it’s important to talk with people you trust. Getting your debt problems off your chest and out into the open can help you feel better. 

• Exercise. Make sure you’re going for walks, bike rides, or regular visits to your favorite gym or fitness class. Moving your body can help you feel better physically and emotionally.  

• Socialize. Connect with your local faith community, favorite clubs or social organizations. Reach out to people who can be a source of support and camaraderie. Debt can be isolating. Don’t feel like you have to stay home alone—stay connected to the world in ways that bring you peace.

• Breathe. Meditation, prayer, and spiritual practices can help soothe your anxiety in times of stress. Practice deep breathing techniques to calm down. Remember that debt is temporary, and this too shall pass.  

Building a Debt Action Plan Without Fear 

Another important way to get past the fear, chaos, and anxiety of debt is to take the first step forward: Make a debt action plan. With a debt action plan, you’ll have a road map of your debts, and you can visualize ways to get rid of them. 

Here are a few easy steps to build your debt action plan: 

• Make a list of your debts. Whether it’s a spreadsheet, a document on your computer, a list of notes on your phone, or a simple list on a piece of paper, make a list. Include details about the type of debt (credit cards, car loan, personal loan, etc.), how much you owe (current balance), what the interest rates are, and what minimum payments are required each month. 

• Decide which debts to prioritize. If you’re struggling to pay your bills or have already fallen behind on any debts, make a note of that on your list. If money is too tight to pay all your bills, which ones do you definitely want to keep paying? For example, if you have a loan on the car you use to get to work, you might want to make that loan payment a top priority so you don’t lose your transportation. 

• Choose a “next best step” for each debt. What can you do next, starting today, to help get rid of each debt? This could include calling creditors to ask for forbearance or deferred payments, making only minimum payments for your lower-interest debts (freeing up more cash to put toward higher-interest debts), or looking for a debt consolidation loan to roll multiple high-interest debts into one payment with a lower interest rate. Set realistic goals, and don’t put too much pressure on yourself. Do what you can, and get small wins along the way.   

Hopefully you’ll find that just the simple act of writing down your debt action plan reduces your debt fear and anxiety. Now that you have your road map for getting rid of debt, you can take the next step forward—finding tools and resources for dealing with debt.

Tools For Dealing with Debt

One hopeful fact to keep in mind is that there is more than one “right answer” for debt problems. Different people might have success with any or all of these choices. As you start your journey of dealing with debt and overcoming debt fear, consider these common debt relief solutions. Here’s how they work, and how to get started. 

DIY debt strategies

Dealing with debt is about repairing the foundation of your everyday financial life. If you consider yourself a DIYer, you may want to try one of these solutions. DIY debt relief doesn’t require a new credit card, new loan, or professional help. Instead, you find whatever extra cash you can, and put that money toward your debts.

Here are the two most common DIY strategies for dealing with debt: 

• Debt snowball. With the debt snowball method, you pay off your smallest debts first, while making minimum payments on all the others. This gets you to your first debt payoff the fastest. When the first debt is paid off, you put its payment toward the second debt (in addition to the minimum payment you were already making). Your payment amount for each new debt grows bigger, like a snowball rolling downhill. 

• Debt avalanche. This strategy works like the snowball, but you focus first on the debt that has the highest APR. This could save you money in the long run. But if your most-expensive debt is big, it could take a long time to get your first win.  

How these methods reduce debt fear and stress: Using a DIY approach to paying off debt can help you feel a sense of confidence and control. It’s also practical and easy to start. All you have to do is decide debt snowball vs. debt avalanche and start making payments.  

Debt relief

Debt relief or debt settlement is negotiating with your creditors to accept less than the full amount you owe and forgive the rest. You can negotiate debts yourself or work with a professional debt relief company like Freedom Debt Relief. Professional help might get you better results than you could get for yourself. They have negotiating experience and relationships with most creditors. 

How this method reduces debt fear and stress: Getting professional debt settlement help can relieve your feelings of debt-related fear, overwhelm, and confusion. If you’re having trouble paying your bills and you don’t want to handle tough conversations with creditors and debt collectors all by yourself, working with a professional debt settlement company like Freedom Debt Relief might help you get rid of debt faster than most other methods.  

Debt consolidation loans for dealing with debt

A debt consolidation loan lets you roll multiple debts into one. This way, you don’t have to keep track of multiple payments and worry about whether you’ve made all of them on time. Debt consolidation loans are best when you can qualify for an interest rate that’s lower than what you currently pay.  

This debt solution is often a good choice if you’re dealing with expensive credit card debt and you can qualify for a personal or other type of loan. 

How this method reduces debt fear and stress: Getting a debt consolidation loan can help you deal with being overwhelmed by too many debt payments. With a debt consolidation loan, you simplify your financial life. Focusing on just one debt payment per month can help you feel calmer and more peaceful. 

Balance transfer cards for dealing with debt

A balance transfer card is another way to consolidate your credit card debt into a single credit card, usually one with a promotional interest rate as low as 0%. You transfer an existing credit card balance to the new card for a fee (generally 3% to 5% of the amount you’re transferring). 

Balance transfers work well only if you can pay off the balance by the time the introductory rate ends (typically six to 21 months). Paying off credit card debt at zero interest for a year (or longer) could give you a powerful tool in your plan for dealing with debt. 

There are some possible downsides to a balance transfer credit card. First, you need good credit to qualify. If you’re already behind on your credit card bills or have delinquent accounts on your credit report, you might not be approved. Also, a common pitfall is to charge up new balances on the paid-off cards after transferring the balances. Doing this could leave you in even more debt than you started with. 

A balance transfer is a bit of a juggling act. But if you have a plan that lets you save some money while you knock out your debt in a relatively short time—and you’re not at risk of running up new debt—it could work. 

How this method reduces debt fear and stress: As with a debt consolidation loan, balance transfer cards can help you simplify and take control of your monthly debt payments while saving money on interest. If you can pay off the full balance by the end of the introductory period, this sense of having a “deadline” might also give you better clarity and focus, helping you get out of debt faster.

Credit counseling

When you work with a credit counseling agency, they might recommend a debt management plan (DMP), in which a credit counselor sets up a structured repayment plan for you. They may also be able to negotiate with your creditors to lower your interest rates. 

The idea is to fully repay your unsecured debts in three to six years. You send monthly payments to the agency, and they distribute the funds to your creditors until you’ve paid off all your debt. You usually have to stop using credit cards while you’re in the plan. 

A DMP with credit counseling can be a good choice, but the payment amount tends to be high. If you can’t make your financial life fit the rules of the DMP, your creditors could back out of the plan.  

How this method reduces debt fear and stress: Talking to a debt expert such as a credit counselor or other financial professional can help relieve feelings of confusion, isolation, and shame about debt. Getting professional advice is a good reminder that you’re not in this alone—you have choices and rights, and many other people have overcome similar challenges before.  

The Real Cost of Avoiding Your Debt 

The scariest thing about debt is that if you leave it alone, it grows. The power of compound interest means that the balances on your unpaid credit card bills and other high-interest debts just keep getting bigger unless you take action. Dealing with debt might be a bit less scary when you keep in mind that the alternative (leaving your debts unpaid and ignoring the problem) is even scarier. 

Here are a few problems you might face if you avoid dealing with your debt. 

Higher debt costs 

Procrastinating about debt is expensive. The longer you go without paying off debt, the more you pay in interest. Making only minimum payments on credit cards could add several years and thousands of dollars to your debt payoff plan. And if you fall behind on credit cards or other loan payments, your creditors and lenders will likely charge you late payment fees or other extra costs.

Damage to your credit 

You might ignore your overdue bills and unpaid debts, but credit bureaus won’t. If you don’t take action to get rid of debt, your personal credit score and credit history are likely to take a hit. Negative events on your credit report (like overdue credit card payments or delinquent accounts) can raise your borrowing costs for years. The sooner you get rid of debt, even if that means seeking debt relief, the sooner you can rebuild your credit. 

Difficulty reaching other financial goals

If you have unpaid debt and no plan to get rid of it, this can be a burden on the rest of your financial life. Having too much debt can make it impossible for you to work toward other important goals, like saving for a house or investing for retirement. 

Getting rid of debt might sound scary, but it can be a big sigh of relief for the rest of your financial life. Facing debt early on—reaching out to creditors, finding out how debt relief works, and making a plan to get rid of debt—can give you more options and better choices. 

People just like you are seeking debt relief in Buffalo, NY and across the country. The first step is the most important one—explore your options.

When Professional Help Makes Sense

If your debt is causing you big stress, fear, and anxiety in everyday life, you may need professional debt help. DIY strategies like the debt snowball method have their place, but sometimes debt is too scary to tackle alone, and there’s nothing wrong with that. People hire professional help for a wide range of financial needs, from managing investments to planning for retirement or doing taxes. Getting professional help with debt can be another helpful tool in your financial toolbox. 

Here are a few warning signs that DIY approaches to debt may not be enough, and you might need professional help with your debt: 

• You’ve fallen behind on bills or have delinquent accounts: People usually go into delinquency on credit cards or other bills because they have serious financial hardship. DIY budgeting tools and debt payoff calculators might not be enough. 

• You’re getting calls from debt collectors: Debt collectors often use fear-based, stressful methods to try to persuade people to pay. If you don’t want to manage these collection calls all by yourself, professional help can be a good choice.

• Your debt makes you feel depressed, paralyzed, or physically unsafe: DIY methods won’t work if you’re feeling too stuck to take that first step. If your debt fear is so serious that you’re afraid of losing your car or the roof over your head, then it’s time for professional help. 

There are a few types of professional help for dealing with scary debt. If you have enough cash to pay their fees, a financial coach or financial advisor can help you set up a customized plan for your overall finances. But if you’re already suffering from debt stress and panic, you probably don’t want to spend more money right now. 

Instead, you might want a free option like consumer credit counseling, or a professional debt settlement program like Freedom Debt Relief. Consumer credit counseling is offered by nonprofit agencies that meet with you for free. Freedom Debt Relief also offers free consultations so you can talk with a professional about your debt, learn about your options, and figure out your best path forward. 

Turn to FDR to Deal with Debt Relief

If you’re dealing with debt and it’s making you stressed or scared, or it’s affecting your ability to pay for the things you need, a debt relief program may be a good option for you. To learn more, talk to a Freedom Debt Relief Certified Debt Consultant. They’ll help you find out if you qualify, and provide information on other options to resolve debt and build a stronger financial future. Contact FDR today.