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The emotional effects of bankruptcy often go overlooked

On Behalf of | Sep 1, 2016 | Personal Bankruptcy

When people in North Carolina are faced with filing for bankruptcy, much of the focus is on numbers, paperwork and money. However, for many, bankruptcy also comes with unseen emotional trauma that can be harmful if not dealt with.

According to The Simple Dollar, one study found that people are two times more likely to suffer mentally from things like anxiety and depression if they are struggling financially. It is also no surprise that debt and stress are closely linked and it has been found that the amount of stress a person suffers is directly related to his or her debt-to-asset ratio. In addition, financial struggles may cause problems in someone’s personal relationships, which in turn can cause people to feel resentment toward themselves or their loved ones.

Relationships can also be affected by feelings of discouragement and annoyance, which people who have large amounts of debt often have. While many debts are often of a person’s own doing, unexpected life events can also cause people to incur debt they had not planned for and this often leads to feelings of anger. Many people are also embarrassed by their debt and their self-esteem can plummet when they see their bankruptcy as a failure.

However, seeking help from a mental health professional can go a long way in helping people deal with the feelings associated with their bankruptcy. In fact, according to U.S. News & World Report, financial therapy grew as an industry as a result of the struggling economy in the last decade. Coping with the psychological effects of debt and bankruptcy in a healthy setting such as a therapist’s office can be much better than someone going it alone and having a breakdown somewhere inappropriate, such as in court. Many people are afraid to discuss bankruptcy due to the stigma surrounding it, but some experts believe that therapy allows a person to face their struggles head on, admit past failures and be able to make a fresh start going forward.


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