Our Top 5 Financial Fears When We’re in Debt

We’re getting into the Halloween spirit here at Clearpoint. From scary movies to haunted hayrides, we have a lot of frights and thrills to experience this month. But we should also stop to think about our finances, and consider some of the common financial fears we all experience. Today we will cover a few of these, explain why they’re so common and give you some tips for how to deal with them.

Money Breaking up My marriage

You’ve likely heard that arguing about finances is a top cause of stress in a relationship and is even linked to divorce. In fact, according to psychological research, it’s the top predictor of divorce.

Plain and simple, we all want to have control over our money, but relationships are about sharing and sacrifice. When there is income inequality in a relationship, a couple experiences a loss in income or someone has a spending problem, things can get out of control quickly.

Couple arguing about money

The most sure way to remedy this situation is to make budgeting a family activity that involves everyone. Make debt repayment a shared goal that you each work toward, and reward yourselves along the way. For more information, be sure to read Why Paying Off Debt Leads to a Happier Marriage.

Losing My Home

As housing counselors and foreclosure prevention specialists, our team here at Clearpoint works with struggling homeowners every day. We’ve frequently heard the stories about what it’s like to have your back against the wall while trying not to lose your most valuable investment and most cherished place.

Bank owned home after foreclosure

It’s a scary thought, for sure. But it’s typically caused by a variety of factors. Maybe it’s a loss of income, poor budgeting, high interest rates or some other unforseen setback. The good news is that there may be quite a few strategies to help you keep the home. There are simple budget and lifestyle changes you can implement, creative strategies like renting out rooms, and even government programs designed to offer aid.

So while this is a valid fear, be sure to exhaust all your options and work with a HUD-approved agency that you can trust.

Taking on (More) Doctor’s Bills

An operation or unexpected illness can create financial havoc. Because these events often catch us by surprise, we haven’t planned for them in our budgets. The bad news here is that if we don’t have the money to cover the costs, we may end up feeling helpless and taking on additional debt in the form of credit cards—or worse, by skipping our mortgage payment.

Even routine and planned trips to the doctor can be big setbacks; the same is true for your monthly insurance premiums.

Medical Bill

In the Kaiser Family Foundation study we participated in, the data showed that even insured adults struggled greatly with paying their medical bills. With family premiums often over $200 a month, it’s easy to see why less cash is available when something goes wrong.

Like with most unexpected setbacks, the best defense is to have an emergency fund. But on top of that, always remember that medical debt is negotiable. Use this guide to negotiate your medical expenses, so that you never pay full price.

Debt Collectors Calling

Having someone on our backs, nagging us to repay a debt is more than just an annoyance. It leaves us with a feeling of constant tension, like we are always looking over our shoulder or waiting for the phone to ring.

Angry Debt Collector

Feeling threatened and under the microscope of someone who has authority over you is a scary situation. Of course, the ideal is to never let our debts reach the point of collections. But even if they do, there are still ways to ensure you are treated fairly. Make sure that any collected follows the rules set forth in the Fair Debt Collection Practices Act, and if they don’t be sure to file a complaint with the CFPB.

Being Conned

Most of us are scared about getting ripped off. We’re smart enough to know not to buy brand-name sunglasses off the street, but we’re less knowledgeable about cyber-crime and the data breaches that are becoming common at retail outlets across the country.

Scam Artist

That’s why Identity Theft remains the number one consumer complaint reported to the FTC each year. It’s certainly a scary prospect—the idea of losing your most personal and private information.

There are three crucial steps you can take to help minimize your risk of theft or control the damage if it happens:

  1. Inspect card readers. At gas pumps and ATMs, in particular, do a visual inspection to make sure there isn’t a data capturing device.
  2. Check your credit report. Use www.annualcreditreport.com and dispute any errors immediately.
  3. Change online passwords frequently.

Face Your Fears

These are all very scary prospects. We hope that you are able to keep these fears from becoming your realities. And remember, we are here to help along the way. Whether it’s stopping the collection calls, coming up with a plan for your home, or getting your credit card interest rates lowered, we will help conquer your fears. We’d love to hear from you when you’re ready to get started.

Thomas Bright is a longstanding Clearpoint blogger and student loan repayment aficionado who hopes that his writing can simplify complex subjects. When he’s not writing, you’ll find him hiking, running or reading philosophy. You can follow him on Twitter.

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