How Debt Clouds Your Thinking

If you think having debt is starting to affect your quality of life, mental health and financial outcomes, you’re not imagining it. Debt can have a huge impact on how we feel, think and act. One of the major reasons debt tends to beget more debt over time is because of how debt clouds our thinking, making it more disfficult to take control of the situation.

Here’s a closer look at some of the ways in which debt is capable of impacting our brains.

 Debt Can Impact Your Emotions

Debt can contribute to feelings of stress, helplessness, depression, anger, regret and more.

One recent study found more than half (53 percent) of respondents with high levels of student debt said they’ve “experienced depression” due to said debt. Furthermore, nne out of 10 survey participants reported feeling substantial anxiety stemming from the burden of these loans. One out of 15 respondents even admitted they had considered suicide because of their hefty student loans.

Another study found debt affects our ability to:

  • Treat ourselves sometimes (59 percent)
  • Live the lifestyles we want to live (59 percent)
  • Pursue our interests and passions (53 percent)
  • Donate to causes (53 percent)
  • Show generosity to family and friends(50 percent)
  • Partake in hobbies (45 percent)
  • Enjoy activities with friends (39 percent)

Many people consider the items on this list contributory to a full and meaningful life. Debilitating our ability to do what we want and/or feel we need to do, debt often holds power over our mental state.

 Debt Can Worsen Quality of Sleep

Medical and psychological experts herald adequate amounts of quality sleep as a must for optimal brain and body function. However, the mental strain of debt and financial worries is correlated with poor sleeping habits.

One survey found people worried about paying their bills had more sleep issues than those who were not worried about paying the bills. One-third of worriers reported never waking up feeling rested — only 13 percent of non-worriers reported the same. In general, worrying about being able to pay bills and maintain their lifestyle, something often impacted by debt levels, contributed to reports of feeling less rested.

Having a plan to get out of debt can help borrowers get on the path toward lessening this mental and physical burden. There are many different options people pursue when trying to vanquish their outstanding balances. These include do-it-yourself repayment strategies, debt consolidation loans, debt management plans, debt relief programs and bankruptcy proceedings if the situation gets too dire.

While there are pros and cons to each approach, asking questions and doing research can help those who are dealing with debt make progress.

 Debt Negatively Affects Decision-Making

Research also shows getting rid of debt doesn’t just improve borrowers’ financial situation, it also takes off a mental load that “clears up cognitive functioning, lessens anxiety and improves impulse control,” according to MarketWatch.

Participants in the study made fewer errors on cognitive tests after their debts were paid down. Fewer participants exhibited anxiety symptoms after clearing up their debts, and fewer people demonstrated a bias toward instant gratification — like making rash purchasing decisions.

In other words, it’s hard to feel good and make sound decisions when you’re dealing with the ill effects of debt on the brain. Getting out of debt doesn’t just signify financial freedom; it can actually change how we think, feel and behave for the better.

Debt can damage our financial stability, but perhaps more insidiously, it can play with our emotions, increase restlessness and tarnish our ability to make good decisions. Getting out of debt one day at a time gets us closer to unclouding our thinking and thriving.

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