Uncertainty and instability are permanent features of our ever-changing world, and that includes stress related to being in debt. After all, paying the debts that you owe local money lenders puts a strain on your budget, and being unable to do so has serious consequences.
Thus, much like stress for any other reason, you must learn how to manage debt-related ones. Aside from helping you go through this problem gracefully, doing so will also strengthen your character.
Whatever your debt situation may be, here are some ways you can remain mentally healthy while trying to comply with loan obligations:
Plan Ahead
Even before you research loan products, loan amounts, and interest rates, you should already be coming up with a repayment plan. This way, you will have a realistic view of how your current income will handle an additional obligation.
Include a budget and timeline in your plan. Managing cash flow without a plan, especially when you have multiple debts, can often feel like a high-stakes game. You may not be able to anticipate all the elements you will face in getting to a better financial status, but having a plan will boost your confidence. At the very least, you’ll be able to anticipate more problems.
Talk to Your Lenders
Before your loan is approved, you can start asking your potential lenders questions. Ask them to simplify terms you do not understand, especially before you sign any loan contract. The fine print you failed to fully grasp because you didn’t ask the lender could be a problem for you in the future.
Also, keep your communication channels open even after you receive the loan proceeds. You might need to ask them things that slipped from your mind when you were applying for a loan. If If anything is unclear in the loan agreement, you can contact them. Instead of getting all worked up and worried, clarify with the lender and ask if they have recommendations. If you have a good relationship with your lender, you might even be able to negotiate better interest rates or ask to renegotiate some loan terms depending on your financial situation.
Plan for Emergencies
Try your best to set aside a portion of the loan amount to cover a month or two of amortization. Put this in a savings account. Whatever you do, do not use these funds for leisure. Think of it as a way of taking care of your future self. You will be grateful for this when something unfortunate and unexpected happens. Even if you get fired, you will have at least 2 months to get a job before you worry about defaulting on your loan payment.
Remember to Account for Inflation
With the volatility of our economy and even the global economy, it’s important to anticipate how the rising inflation will negatively affect your finances. The value of money today is usually less than its actual value in just a few years. Include this when you make your budget so it will be one less thing to worry about.
There’s nothing worse than getting surprised at how little your money can buy compared to years ago. By being realistic in your expectations and making plans on how to manage these scenarios which will definitely come, you can stay calm.
Do Self-Care
Self-care does not need to be expensive. You do not need to splurge on a plane ticket or an out-of-town trip. Instead, do things that will mentally benefit you, like meditation, eating the right meals, and taking a short but relaxing break.
It also helps to look within yourself. What triggers your stress and anxiety? What brings you joy? What are your cheap thrills? What are the simple things that can make you happy? These things should help you cope with your difficult financial situation. Remember, you will not be able to solve your debt-related problems if you burn out too soon.
Conclusion
The world is full of things that can stress us out. Planning ahead and knowing ourselves are basic steps in learning how to combat stress and avoid burn out. Think of the long-term. Life is a marathon and not a single run. Learn how you can live and thrive even with uncertainty and pressure.
