7 Signs You Have Too Much Debt

Is money on your mind all day every day? There’s a high chance it’s because you carry too much debt on things like loans, credit cards, and car payments. Most people do, but some way more than others. This condition might destroy your mental health if you don’t start acting on it right now. However, it’s possible to change that and live a healthier financial life if you plan your expenses and have discipline. Here are seven signs you have too much debt:

1) You Don’t Know How Much You Owe

Are you the type of person who knows you have debt, but avoids even thinking about how much you owe? Hiding it from yourself won’t make the problem go away. It is the first step you need to take if you want to be debt-free. You can do that by reading your statements and listing all of your debt so that you can create an action plan to get rid of it. 

2) You Pay Most of Your Bills Late

The bills come, and you feel lost and anxious because you don’t have enough money to pay for everything. As a result, you leave them unpaid for a long time or just start making minimum payments. You end up paying a lot of interest in the end and might end up with even more debt than you initially had. A get strategy you can use to solve this is by using the Snowball Method.

3) Money Causes You Anxiety

Debt is always at the back of your head and causes you a lot of stress. You can’t sleep well, and you’re always anxious. This is a sign this situation has gotten out of hand. You need to create a plan of action to solve this problem, so you get rid of it as soon as possible. 

4) You Don’t Have Any Savings

If you lose your job, get ill, have an accident or anything else, you don’t have anything backing you up because you spend everything you earn. Most people think that they need to pay all of their debt first before having an emergency fund, which is not true. Thinking like that might make you end up in even more debt. Therefore you should consider saving at least 10% of your income in a high-yield savings account. 

5) You Leave Outside Your Means

You’re very familiar with the concept of living paycheck to paycheck because you do it every time. You buy things because you “worked hard for it”. However, you need to change this mentality to become financially independent. Having a budget is crucial if you don’t want to owe even more money, and it will also give you peace of mind. You can still do the things you like to do and have fun, as long as it’s planned and within your resources.

6) You’re Afraid of Phone Calls 

You avoid answering your phone because you think it might be collectors asking you to meet your obligations. However, you can’t avoid them forever, since they might sue you and seize your property or even your money as soon as it reaches your bank account.

7) You Hide Your Spending From Your Friends and Family

Most people in this situation are embarrassed and feel bad about being in debt. They start emotional shopping to feel better, even if it’s a temporary relief, regret later and hide or don’t tell their loved ones about it. Don’t be afraid of admitting you have a problem and ask for help.