Emotional debt is a form of self-harm

Expensive debt is crippling many people by sucking the life out of their finances and leaving them with nothing. Imagine the devastation left by a plague of locusts and you’ll begin to see this endemic problem for what it truly is. But what if I told you a large percentage of expensive debt is self-inflicted? Would that unsettle you?

What is going on behind the scenes when people get themselves in trouble with expensive debt? Here are a few causes of emotional debt that I call a form of self-harm.

In my experience people use credit cards, hire purchase and high interest loans to fund their decisions that are made in a moment rather than through planning. Lack or foresight usually means lack of preparation. When there’s an amazing special on something you want but you haven’t thought about it until you saw the advert on the TV you react and “charge it to the card”. People who plan ahead are prepared financially whereas those who buy on emotion get themselves in financial trouble.

I’ve seen others use spending as a “make me feel good” form of therapy. I had one friend admit that he used to spend money he didn’t have because the emotional charge he received from shiny new toys made him feel better about himself. The problem with this is twofold: toys are never going to positively affect your self-esteem, and secondly, spending money you don’t have will hurt you financially. Plus, the resulting financial difficulty will only add to the self-esteem issues that exist, thus making the problem worse, not better.

A potentially damaging mindset is the “sunny day” mentality that underpins many people and their spending habits. What I mean by this is the belief some have that the rainy day will change into a sunny day sometime soon. We all know we can’t control the weather, but these people put their hope in the sunshine that might come not realising their behaviour is making their circumstances worse. That kind of thinking would have me swimming in my pool in August, something I am definitely not prepared to do! We should prepare ourselves for the weather we have today, not what might come next week or next month.

Finally, there’s the Eeyore mindset. Remember Eeyore from Winnie the Pooh? He decided in advance that his life was not going to be enjoyable and so he self-prophesied doom and gloom. And that is what he got. When we see the negative state of our affairs and accept it as our lot in life we destine ourselves to a life of poverty in the mind and the pocket.

The first step in fixing all causes of self-harm is the difficult step of beginning to think that you are worthy of good things. I recognize this is a sensitive subject but I see it too often and I hate the affect it has on people. You are a good person and you deserve the best in life.

(This article was originally published in Phil’s regular column in the Waikato Times newspaper.)