Psychology of Debt

Debt itself is not bad but badly borrowed debt is bad.

A leading economic psychologist has looked at the impact of debt and the outcome is unsurprising:

“Being in debt can be quite an emotional experience for some consumers and according to the report, 20 per cent of the adult population are financially phobic.

These 'financial phobes' reported the following emotions at the thought of personal finance:

• 45% reported anxiety
• 15% say they felt immobilised
• 12% felt physically ill.

Professor Alan Lewis says "Consumption has become so important today that to have is to be. The tendency is to want more and to want it now. With the daily bombardment of finely tuned messages encouraging consumers to take out new credit cards and short terms loans, it is no surprise that many consumers find borrowing easy and safe. In particular, 'financial phobes' tend not to think about their personal finances and are less inclined to monitor their expenditure.

Professor Lewis adds "Three easy steps can help consumers resolve their financial difficulties. Firstly, consumers need to assume responsibility for their actions. The second step is for consumers to prioritise spending and the final step is to develop an effective money management strategy. “ * (Agilisys Ltd)

Always face your debt or use an adviser to help you and remember that today is the tomorrow you worried about yesterday and all is well. Keep it that way.