Debt is a central feature of many people’s money landscape. Dislike of debt is also a central feature! Many of us take out loans for schooling, a home, and vehicles. There are also debts we accrue during life transitions such as illness, divorce, starting or growing a business, or having a child. It can be easy to feel burdened or even haunted by the weight of owing money. Similar feelings of overwhelm or anxiety can come up after using a big chunk of savings or an inheritance.
When debt leads to painful feelings like these, we may tend to get stuck in a state of resistance as we attempt to push the debt away, ignore it, or wish we’d never generated it in the first place.
And while there are some financial teachers who inadvertently fuel this stance by railing against debt in any form and for any reason, my position is less black-and-white.
I guess you can say I take the more compassionate approach rather than the kick-in-the-ass approach. I’ve also noticed that many of these most ardent teachers have had their own journey with debt and even bankruptcy. So please find the best way for you, which might be a combination of both approaches depending on where you are in your life.
I believe that there can be both healthy and unhealthy debt. With my emphasis on the psychological and relational aspects of money, the most important angle for me is that we keep learning and understanding how we have handled things in the past, continue to deepen our awareness in the present, and see how we can improve our situation in the future.
I love helping people free themselves from the feeling of being haunted by learning how to view and relate to their debt in new and creative ways. We can certainly have a sense of freedom even while we still owe money! I will, however, add that if you are experiencing more of a persistent or addictive relationship to debt, as opposed to having one debt from a particular juncture in your life, then I have additional resources for you below.
Here are some perspectives and resources–some psycho-spiritual and some practical–that can help you shift away from haunted and head toward freedom.
1. Rename.
One of my favorite parts of the Values-Based Bookkeeping doorway (The second doorway in our 3-Part Conscious Bookkeeping method) is when we get to add our values to our bookkeeping system by renaming our Asset, Liability, Income, and Expenses categories. This is a simple yet powerful way to add meaning and fun to our money relationship.
One of my favorite stories of renaming comes from an old student of mine who had a debt, did not want to pay it back, and felt completely trapped by it. When we sat down to have a look at it with fresh eyes, to reflect on its origin and articulate what it had allowed her to experience, her whole perspective on it shifted rather quickly. Turns out that this debt was created by a big trip to Italy she’d taken years before.
This trip was a very important turning point in her life, and she still carried enormous gratitude for it. With this new clarity, she decided to rename her debt-liability “My Italian Experience.” This simple act of renaming connected her with the desire and commitment to begin paying it off with enthusiasm and appreciation.
The key to this type of shift is in seeing and connecting with the very personal value of your debt. The payoff for taking the time to consciously do this can be huge.
2. See liabilities as hidden assets.
One of the ideas that my mentor, Tamara Slayton, shared with me years ago is that some liabilities are actually hidden assets. She didn’t elaborate at the time, but over the years I have uncovered a lot of power in this concept.
At one level, this concept can help us reframe debt when it serves as an investment in our tangible future. School loans and business loans can directly affect our careers and income level.
At another level, this concept can refer to a time of deep transition: grieving over the loss of a loved one, illness, mid-life transformation. This is a time when we may choose to live on that savings or inheritance or go ahead and accrue a chunk of debt.
Reframing this expenditure as a hidden asset can remind us that if we allow ourself the time and space to fully engage with these types of experiences then we will emerge on the other side with new awareness and capacities that will take us back into the world again in a whole new way.
3. Remember that Life has many Cycles and Money Cycles too!
Just as we all go through changing life cycles, so too do we go through money cycles. Most of us experience peaks and valleys to our creativity, productivity, success, and income. Our yearly finances are variable–in one year we may earn more, while in others we may save more, give more, or invest more. Some years we may scramble to live within our means. And yes, some years we take on some debt.
Bringing awareness and intention to these shifting cycles can enhance our clarity and peace of mind, which is one of the reasons I love cultivating an ongoing money practice. Our whole life–most certainly including our financial life–is a continual dance to be living and learning from.
4. Create a ritual.
Ritual provides a wonderful way to strongly engage and amplify each (or all!) of the tools mentioned above. It is a doorway into the healing processes of honoring, forgiveness, acceptance, and understanding. It also a powerful way to mark the end of one chapter of life and call in the next.
Simply put, a personal ritual is a set of actions that empowers some intention. In the context of this article, that intention could be related to debt renaming, liabilities reframing, or honoring and celebrating life and money cycles. It could also address those times that we spent a large chunk of a savings or inheritance.
When we give form to intention by way of words and/or movement, we generate power, consolidating and focusing the energy in and around us. Most ritual has a clear beginning, middle, and end. Within that basic structure, though, the sky’s the limit. A ritual can last a few minutes or a few hours. It can be enacted by yourself or with a group. It can take place outside in deep wilderness or at home in your living room. The only rule is that it needs to feel meaningful and true to you. It can feel intimidating at first to imagine creating a ritual, but if you let yourself experiment (and keep it very simple to start with), I bet you will find it very rewarding!
Check out this post for more details on how to create a ritual.
5. Find your own right pace.
Do a body-check in and ask yourself this question,
“What is the right pacing for paying off my debt?”
As in every area of life, we can fall prey to following external voices instead of our own, internal voice. We can certainly benefit from the guidance of others, but not when it’s to the exclusion of our own inner guidance. Give yourself the gift of tuning in to yourself to find your own right right pace for your repayment schedule, and then re-visiting this every few months to ensure that you are staying true to this right relationship with your debt.
This concept comes from Hiro Boga’s article, “I owe, I owe…Right relationship with Debt,” and I think it’s a very important one.
I had already started pondering this topic when Hiro’s article, as though it was perfectly orchestrated, appeared in my fb thread. Hiro is a spiritual guide and mentor for entrepreneurs. I have been hearing about her work for some time and just recently connected with her via social media.
In her article, she spells out some really lovely and helpful teachings about debt and spirituality. I highly recommend that you read it.
Since there is a wide range of spirituality in our community, just see what fits for you, what might be helpful, and leave the rest.
6. Add in some practical resources.
If you want some assistance with mapping out your monthly debt payments, making sure your interest rates are low enough, plus all of the different repayment options such as consolidation, negotiation, bankruptcy, here are some good resources.
1. Gerri Detweiler– She is my go-to person for answering any questions about debt. This is her speciality. Her book Reduce Debt, Reduce Stress lays out many of your options in a simple and non-judgment way that is very helpful.
2. Savvy Money– Debt account organizer.
3. Payoff– Share dreams, set goals, pay off debt or save for a trip.
4. Mint – and it’s Goal features! You can set up goals to reduce your debt. Mint is a wonderful tool to achieve those goals…at a pace that you define.
5. YNAB – This is a wonderful online tool to help you pay off debt and bring more awareness to your numbers and your patterns.
2. April Benson’s Shopaholic No More
3. Man Vs. Debt
4. Dave Ramsey’s Financial Peace University
5. The book Overcoming Underearning by Barbara Stanny
