Family with two kids in home interior

Debt Basics

How debt stress affects your health—and what to do about it

Jan 07, 2024

Rebecca-Lake.jpg

Written by

James-Heflin.jpg

Reviewed by

Key takeaways:

  • Debt is a significant source of stress for many Americans. 

  • Managing stress is important for maintaining good mental and physical health. 

  • Improving your financial situation and seeking therapy are two ways to manage debt stress.

When your physical or mental health is suffering, debt stress could be a culprit. Taking action, from DIY payoff to consolidation or debt resolution, is one of the best ways to start feeling better. Managing your finances can lighten the burden you feel. Each step you take can bring more relief. 

If debt has you feeling bad, you’re not alone. Let’s explore the strategies that can help you handle your debt in a way that supports both your financial health and your overall health. 

Understanding financial stress

Financial stress happens when money causes you to feel worried, anxious, or some other negative emotion. Common money stressors can include:

  • Not having enough money to cover your bills

  • Worrying that your debit card or credit card will be declined when you try to pay for something

  • Getting hit with a financial emergency that drains your savings account

  • Trying to pay down debt, and feeling like you're getting nowhere

  • Worrying that you're behind everyone else in saving or reaching other money goals

The thing to keep in mind is that personal finance is just that—personal. Everyone's financial situation is different, so what might stress you out may not bother someone else, or vice versa. 

That's important to remember, because it can help you put money problems into perspective. And once you know where you stand financially, it's much easier to put together a plan for getting ahead. 

Finances and your physical health

Financial stress is not great for your physical health. Sometimes, the impacts of money stressors on your body are easy to recognize, but other times they're subtle. 

Financial stress can lead to:

  • Headaches

  • Indigestion and other digestive problems

  • Sleep problems

  • Increased risk for heart disease or stroke

  • Memory impairment and inability to focus

  • Weight gain

  • Reduced immune response

None of that sounds good, right? And frequent stress over money can increase your risk of developing serious health issues in the long term. That can lead to even more financial stress if you end up in medical debt from health conditions. 

You don’t have to have perfect finances to be happy. What’s important is to take control of the financial stressors that may be impacting your well-being, so you can be the healthiest, happiest version of yourself.

Mental and emotional effects of financial stress

Stressing about money can also impact your mental and emotional health. Research has shown that people who experience financial stress are more inclined to experience psychological distress.

That distress can manifest itself as:

  • Anxiety

  • Depression

  • Feelings of hopelessness

  • Emotional exhaustion

  • Serious mental illness

  • Suicidal thoughts

When stress levels get too high, you might feel paralyzed, like you can’t do anything about your financial situation. That could leave you stuck in place, further compounding your stress. 

If you are having suicidal thoughts, you can call or text 988 and talk with someone at any time of day or night. You can also call (800) 273-TALK (800-273-8255).

Sleep disturbances due to money worries

Being in debt can certainly keep you up at night if you're constantly trying to figure out a solution to get out of debt. Losing sleep over your money situation can affect your health in some pretty significant ways. For example, sleep disturbances could lead to:

  • Dementia

  • Heart disease

  • Type 2 diabetes

  • Obesity

  • Certain types of cancer

Making sure you get enough sleep (we’ll look at ways to relieve stress and make that more likely in a minute) is an important step in the right direction. When you get sufficient, good-quality sleep, you can face your financial situation with a clear, alert mind and focus on finding solutions.

How debt stress can affect your relationships and social life

Fights over money are routinely cited as a top reason for divorce in the U.S. And if you're still in the dating pool, you might find potential partners who see debt as a dealbreaker. That doesn't mean you can't make a love connection if you have debt. But it can add a wrinkle to a relationship if you're not on the same page about how to handle it. 

Debt stress can also take a toll on family relationships and friendships. For example, say you borrowed money from a relative to cover the bills, and haven't paid it back yet. So they question you about spending and drop hints about what you owe them. It doesn't always happen, but it can make a relationship uncomfortable if it does.

The same goes if your friends want to include you in things that require spending money. You might feel embarrassed about saying no, or go along to keep up appearances, even if it means adding to your debt. 

Not being able to afford a night out or a spur-of-the-moment trip isn't anything to be ashamed of. But you might feel that way if you get caught in the FOMO trap. 

Ways you can relieve the pressure of debt on your life

If you're experiencing debt stress, the worst thing to do is nothing. Even baby steps can move you forward and help you get control of your finances. Taking action, even a small one, could help turn a downward spiral around. We each have to drive our own bus, even when it seems easier to wait for someone else to take the wheel. You have the power to break the hold those stressors have over your physical and mental health. 

Here are some tips for managing financial stress that might be spilling over into mental or physical stress. 

  • Assess the situation. While it might seem easier to stick your head in the sand, if you don't know what's happening with your finances, stress has a better chance of taking over. So take an honest look at your finances, including how much you bring in, how much you spend, and what you owe. The main goal is to stop avoiding your finances if you have been.

  • Start with small changes. It's difficult to improve your money situation overnight, but you can do things on a smaller scale and get ahead. That might be as simple as making a monthly budget if you don't have one or looking for one small expense to cut out. You can continue making small improvements that eventually add up to a big difference in your finances. And make sure to pat yourself on the back for even small wins.

  • Consider therapy. Talking to someone about your financial stress can help lighten your mental load, versus carrying your fears or worries around. A therapist may not be able to offer advice on fixing your financial issues, but they can offer a safe space for venting and processing emotions. 

  • Practice self-care. Adding self-care to your routine can help you reap mental and physical benefits as you navigate money management solutions. For example, you might try meditating daily or starting a yoga practice. Doing a cardio workout a few times a week, setting an earlier bedtime, and eating a healthy diet can also help you feel better.

  • Consider getting professional help with your debt. Sometimes debt becomes more than you can handle yourself. It can help to talk with a financial professional who can look at your finances and offer solutions. That might include a debt management plan, debt resolution, or another approach. 

You can get through financial stress and defeat your debt. Debt happens to a lot of us, but you don't have to stay stuck. Learn to recognize the symptoms of debt stress, and you can manage your health while you're managing your money. The sooner you take action, the faster you'll get your finances and health back on track. 

What's next:

  • Make a list of your debts if you haven't done so already, including who you owe, the amount, and your interest rates and monthly payments. 

  • Download a free budgeting app to track your income and expenses. 

Consider talking to a debt expert to get advice on your financial situation.

Author Information

Rebecca-Lake.jpg

Written by

Rebecca is a senior contributing writer and debt expert. She's a Certified Educator in Personal Finance and a banking expert for Forbes Advisor. In addition to writing for online publications, Rebecca owns a personal finance website dedicated to teaching women how to take control of their money.

James-Heflin.jpg

Reviewed by

James is a financial editor for Achieve. He has been an editor for The Ascent (The Motley Fool) and was the arts editor at The Valley Advocate newspaper in Western Massachusetts for many years. He holds an MFA from the University of Massachusetts Amherst and an MA from Hollins University. His book Krakatoa Picnic came out in 2017.

Frequently asked questions

Nonprofit credit counseling organizations can offer help with reviewing your budget and debts, and suggestions on managing your finances. The fee for services is often modest, around $30 to $50 per month after a free initial consultation. 

There is no charge to talk to an Achieve debt expert. This is someone who can listen to your situations and explain various financial solutions that might be appropriate. There’s no obligation on your part.

Serious debt requires serious solutions. When you're deep in debt, it helps to assess all the possibilities for dealing with it. For example, if you owe a lot and don’t own much, you might be a candidate for Chapter 7 bankruptcy, which could wipe out your unsecured debts. Another option is to negotiate with your creditors to accept less than the full amount you owe. 

The fastest way to pay off debt is different for everyone. For some people, it’s paying as much as you can every month, following a debt avalanche or debt snowball strategy. For others, it may be resolving debts for less than the full amount that you owe. This is where talking to a debt expert can help you forge the right path.

Related Articles

what-does-it-mean-to-be-insolvent.jpg

Debt Basics

You may be insolvent if you don’t have enough money to pay your debts. Insolvency could allow you to settle debt tax-free or wipe it out in bankruptcy.

good-debt-bad-debt.jpg

Debt Basics

Good debt helps you reach your goals at a cost that’s fair. Learn more about how to judge a debt for yourself.

cease-and-desist-letter.jpg

Debt Basics

Creditors shouldn’t harass you. Learn how to write a cease and desist letter to control contact from debt collectors.

Achieve Logomark

Achieve is the leader in digital personal finance, built to help everyday people move forward on the path to a better financial future.

Footer Trust Pilot Marker

TrustScore 4.8/5

Footer BBB Marker

.

Personal loans are available through our affiliate Achieve Personal Loans (NMLS ID #227977), originated by Cross River Bank, a New Jersey State Chartered Commercial Bank and may not be available in all states. All loan and rate terms are subject to eligibility restrictions, application review, credit score, loan amount, loan term, lender approval, credit usage and history. Loans are not available to residents of all states. Minimum loan amounts vary due to state specific legal restrictions. Loan amounts generally range from $5,000 to $50,000, vary by state and are offered based on meeting underwriting conditions and loan purpose. APRs range from 8.99 to 35.99% and include applicable origination fees that vary from 1.99% to 6.99%. The origination fee is deducted from the loan proceeds. Repayment periods range from 24 to 60 months. Example loan: four-year $20,000 loan with an origination fee of 6.99%, a rate of 15.49% and corresponding APR of 19.54%, would have an estimated monthly payment of $561.60 and a total cost of $26,956.80. To qualify for a 8.99% APR loan, a borrower will need excellent credit, a loan amount less than $12,000.00, and a term of 24 months. Adding a co-borrower with sufficient income; using at least eighty-five percent (85%) of the loan proceeds to pay off qualifying existing debt directly; or showing proof of sufficient retirement savings, could help you also qualify for lower rates. Funding time periods are estimates and can vary for each loan request. Same day decisions assume a completed application with all required supporting documentation submitted early enough on a day that our offices are open. Achieve Personal Loans hours are Monday-Friday 6am-8pm MST, and Saturday-Sunday 7am-4pm MST.

Home Equity loans are available through our affiliate Achieve Loans (NMLS ID #1810501), Equal Housing Lender. All loan and rate terms are subject to eligibility restrictions, application review, credit score, loan amount, loan term, lender approval, and credit usage and history. Home loans are a line of credit. Loans are not available to residents of all states and available loan terms/fees may vary by state where offered. Line amounts are between 15,000 and $150,000 and are assigned based on debt to income and loan to value. Example: average HELOC is $57,150 with an APR of 12.75% and estimated monthly payment of $951 for a 15-year loan. Minimum 640 credit score applies to debt consolidation requests, minimum 670 applies to cash out requests. Other conditions apply. Fixed rate APRs range from 8.75% - 15.00% and are assigned based on credit worthiness, combined loan to value, lien position and automatic payment enrollment (autopay enrollment is not a condition of loan approval). 10 and 15 year terms available. Both terms have a 5 year draw period. Payments are fully amortized during each period and determined on the outstanding principal balance each month. Closing fees range from $750 to $6,685, depending on line amount and state law requirements and generally include origination (2.5% of line amount minus fees) and underwriting ($725) fees if allowed by law. Property must be owner-occupied and combined loan to value may not exceed 80%, including the new loan request. Property insurance is required as a condition of the loan and flood insurance may be required if the subject property is located in a flood zone. You must pledge your home as collateral and could lose your home if you fail to repay. Contact Achieve Loans for further details.

Affiliated Business Arrangement Disclosure: Achieve.com (NMLS #138464) and Achieve Loans are both wholly owned subsidiaries of Achieve Company. Because of this relationship, your referral to Achieve Loans may provide Achieve.com a financial or other benefit. Where permitted by applicable state law, Achieve Loans charges: 1) an origination fee of 2.50%, and 2) an underwriting fee of $725. You are NOT required to use Achieve Loans for a home equity line of credit. Please click here for the full Affiliated Business Arrangement disclosure form.

Resolution is available through our affiliate Achieve Resolution (NMLS ID # 1248929). All estimates for Achieve Resolution’s services are based on prior results, which will vary depending on your specific enrolled creditors and your individual program terms. Not all Achieve Resolution clients are able to complete their program for various reasons, including their ability to save sufficient funds. Achieve Resolution does not guarantee that your debts will be resolved for a specific amount or percentage or within a specific period of time. Achieve Resolution does not assume your debts, make monthly payments to creditors or provide tax, bankruptcy, accounting or legal advice or credit repair services. Achieve Resolution’s services are not available in all states, including New Jersey, and their fees may vary from state to state. Please contact a tax professional to discuss potential tax consequences of less than full balance debt resolution. Read and understand all program materials prior to enrollment. The use of Achieve Resolution services will likely adversely affect your creditworthiness, may result in you being subject to collections or being sued by creditors or collectors and may increase the outstanding balances of your enrolled accounts due to the accrual of fees and interest. However, negotiated settlements Achieve Resolution obtained on your behalf resolve the entire account, including all accrued fees and interest. C.P.D. Reg. No. T.S.12-03825.

© 2024 Achieve.com. All rights reserved. NMLS #138464