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I feel so anxious about £8k debt, I’m trapped in a vicious spending cycle – how to find your way out
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TEARS roll down mum-of-two Zaneta Ballard’s cheek as she checks her bank balance, she’s already deep into her overdraft and owes £7,000 on credit cards.
The 37-year-old from Buckinghamshire, who runs an online shop selling nail wraps called The Happy Nail Place, is trapped in a vicious cycle of buying online to distract from her anxiety and then feeling anxious about not having money.
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“For a little while I will be trying to save where I can, but as soon as I have a little bit of money, I overspend again,” she says.
“To be honest I can't even work out if I feel anxious because I overspent and am out of money or I overspend because of anxiety. It just keeps going round and round in circles.”
And she’s not alone, the Office for National Statistics says as many as a quarter of us suffer from anxiety, and research by savings and investments company Hargreaves Lansdown found people with anxiety struggle more with managing money.
They are less likely to have enough savings or cash left over at the end of the month, have less saved enough into a pension, are less likely to own a home, and are more likely to be in arrears.
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After moving to the UK from Latvia in 2009 when she was 21, Zaneta, who had struggled with mental health issues in her childhood, thought she had put it all behind her.
Finding work as a finance administrator, she then fell in love and married her electrical engineer husband seven years ago.
But when she had her first son, now four and a half, problems resurfaced. And they only got worse when the couple had their second son, now one and a half.
Zaneta had to cut her hours to three days a week to raise her family. Nursery was initially £1,000 a month – eventually falling to £400 with the 30 hours free childcare when her child turned three.
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“But by that time my youngest started nursery, so we had to pay his full fees. I was left with about £300 per month,” she says.
Struggling to keep up with work, kids, the bills and housework, and with her anxiety levels rising, Zaneta turned to online shopping to relax.
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“Trying to balance it all felt overwhelming. I’d find myself online looking for a little treat, and the kids always need something. It's exciting to buy something new and makes me feel better for a day. But with every month I was struggling even more to keep up.”
Zaneta knew she was spending more than she could afford, but just avoided checking her bank account.
“I wanted to believe there was more money than there actually was and kept spending. When I eventually checked the account, I cried.” She’d used up all her £900 overdraft and had debts of £7,000 on her credit cards.
What followed was a couple of “really bad” anxiety episodes. She would promise herself to only buy necessities, but always fell back into spending.
“I felt helpless realising how much I will have to pay back. It's so easy to spend all this money with everything being online,” she says.
Zaneta’s complete breakdown came when work “very suddenly became toxic” but her debts meant she felt she couldn’t leave.
“My husband works and makes sure we have a roof over our heads, but I couldn't be out of work and expect him to not only provide for us but also pay my debt,” she says,
Eventually Zaneta was made redundant. Some of the money she got as part of that went to pay off some of her debts. But now she is stressed about finding a replacement income.
“If I don’t find a new job soon or my business doesn’t start earning me enough, then I will be in a much more complicated position,” she says.
“My anxiety around money gets my mood so low a lot of the time, it affects my interaction with the kids. I snap more when it's getting me down which is not fair on them. Not a very nice place to be.”
Hargreaves Lansdown's research shows homes where people have high levels of anxiety suffer from poor financial resilience in all sorts of areas of their lives.
Households where the main earner has high anxiety earn around a third less on average – at £32,312 compared to £47,399 among those with low anxiety. They also have just £166 left at the end of the month compared to those with low anxiety who have £296, on average.
“When you’re struggling with your mental wellbeing, it can make it more difficult to deal with financial issues,” says Sarah Coles, head of personal finance at Hargreaves Lansdown.
“People might struggle to face them, they might overspend, and they might even be unable to work, exacerbating all their financial problems,” she says.
Higher bills due to the cost of living crisis are a big part of people’s money worries. But there are some techniques that could help those also dealing with ongoing anxiety.
Georgina Sturmer, a registered counsellor, says when it feels as if anxiety is having an impact on our financial behaviour, it’s worth writing down and tracking our thoughts alongside our financial decisions.
“This gives us an opportunity to notice patterns and triggers in relation to our saving and spending. It also gives us a chance to challenge any negative thoughts, or to see if we are spiralling into a catastrophe,” she says.
She also recommends finding someone to talk to. “When we feel anxious, it’s easy to end up feeling isolated in our struggles. If we can find a trusted friend, colleague or family member to open up to, then it can help to alleviate our worry,” she advises.
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If you are struggling with your finances, you can get free debt help via a number of avenues.
- Citizens Advice - 0800 144 8848 (England) 0800 702 2020 (Wales)
- StepChange - 0800138 1111
- National Debtline - 0808 808 4000
- Debt Advice Foundation - 0800 043 4050
How firms can help people struggling with anxiety
TALKING to companies about spending limits, unpaid bills and mounting debts can also be a struggle.
Ed Fraser is founder and head of financial coaching at The Parent Money Coach.
He says companies need to do more to better support customers with anxiety. He says they can do this by:
- Offering a range of methods of communication – for those who struggle to walk into an office or branch or to pick up the phone.
- Listening to anxious customers – they first need to be listened to and not just told the
- solution.
- Being clear with language – keep it simple, straightforward and positive.
- Being empathetic, not sympathetic.
- Following up with that customer – if you say you are going to contact them via phone or email, do it.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected].
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