Do You Have a Relationship With Debt?

by Gary Foreman

Some of us have a love-hate relationship with debt. We hate when we take on debt, but we just can’t seem to stay away from it. How you relate to money can make all the difference in your financial future. Will yours be debt-filled or debt-free?

Do you have a relationship with debt? You hate it but feel helpless to stay away from it? If so, you’re not alone. To help us dig beneath the debt, we reached out to David Weliver of Money Under 30.

Q: Sometimes people fall into debt suddenly due to an accident or major illness. Short of anticipating and insuring that type of event, is there any behavior that can help put people in a better position to withstand sudden expenses?

Mr. Weliver: Although an unexpected illness or accident is a common cause of major debt, it’s also very preventable. The best thing you can do for your finances is to have emergency savings on hand equal to at least six months’ worth of your monthly expenses. To help you get there, I recommend having two checking accounts and at least one savings account. You deposit your paycheck and any other income into one account and then transfer a fixed amount to the other checking account and that’s what you have to spend. Then, you can transfer the surplus to a savings account and begin to build your emergency fund.

Of course, there will be situations that will draw down even a well-funded emergency fund. If an illness or injury threatens to bankrupt you, slow down and think about the big picture. Doctor’s offices and hospitals will pressure you to pay bills, even if it means putting everything on a high-interest credit card. But that may not be the best strategy. You may be able to negotiate medical bills for significant savings, for example, but not a credit card balance. In addition, entering into a payment plan with a hospital may be far less costly than paying 20% interest on a credit card.

Q: Is being a “shopaholic” just a symptom of a larger problem? Are there behaviors that tend to lead to shopaholic behavior?

Mr. Weliver: I think so. I’m not a psychologist, but based on my own experience, “retail therapy” absolutely provides a temporary high and I can absolutely see how people can get hooked on that like a drug. And just like a drug, the high from spending money is very short-lived and immediately followed by a longer-lasting low of guilt and regret.

If you notice a pattern in which you’re spending money not because you need something or have been saving for something you want but because you’re bored, depressed, anxious, etc., I think making an appointment with a therapist should be your first step. Most financial issues are, in fact, behavioral issues.

Q: What healthy behaviors can people imitate to help keep them from debt problems?

Mr. Weliver: The acts of gratitude and being present will go a long way in preventing debt. We’re not only happier when we’re grateful for what we already have instead of wanting for what we don’t, but also we’re going to save money instead of spend it. And when we’re focused on the present, we’re more likely to be satisfied with the important things in life, like our psychical health and the people we’re with, not material things.

Q: Are there some behaviors learned early in life as children or teens that predict a tendency to have debt problems later in life?

Mr. Weliver: I definitely suspect our early experiences with money shape how we manage money as adults. For example, although my parents were good about teaching me to save money for things I wanted as a kid, I never saved money “just to save money” or for long-term goals like education or retirement. Therefore, I learned the saving lesson, but the way I learned it is that saving is really for buying more expensive stuff! I think that explains a lot about why I overspent in my early 20s and had to learn better money habits on my own as an adult.

Q: Does changing behavior automatically solve debt problems? Or will other steps be required?

Mr. Weliver: Sudden and total behavior change is quite difficult and extremely rare, so I think embracing a debt-free lifestyle will be a process for most people. There will always be situations that tempt you, but if you commit to living within your means and begin to value the security that saving provides more than the gratification spending provides, you’ll make more good money decisions than bad ones. The more you do that, the wealthier you’ll become.

• What Does My Debt Cost Me?
• The Emotions Behind Buying Stuff
• 6 Ways To Build a Healthy Relationship With Money
• Escaping Credit Card Debt: $30,000 Conquered
• Struggling To Build an Emergency Fund
• Staying Motivated To Continue Digging Yourself Out of Debt

Reviewed November 2023

About the Author

Gary Foreman is the former owner and editor of The Dollar Stretcher. He's the author of How to Conquer Debt No Matter How Much You Have and has been featured in MSN Money, Yahoo Finance, Fox Business, The Nightly Business Report, US News Money, Credit.com and CreditCards.com.