Debt guilt, anguish can take a high toll

Feeling overwhelmed by debt is like being in a toxic relationship. You can feel sick to your stomach, find yourself walking on eggshells or repeating old patterns, and be unable to sleep.

That’s how a national organization is framing its new report released this week. The hope is people will be more open about how “dysfunctional” debt makes them feel if they think of it like being with a bad romantic partner.

“People can relate to the idea of being in a typical bad relationship. You are in and out of it,” says CEO of Credit Canada Laurie Campbell.

“It can be an eye-opener to think of being in debt in that same way.”

Some 23 per cent of British Columbians who responded to the survey said their current debt level makes them feel depressed.

It made 22 per cent of them “unmotivated to pursue goals” and 20 per cent of them “avoid social gatherings,” some of the highest numbers recorded in a national survey. Some 29 per cent said it made them feel “like they are never moving forward.”

“Being depressed and unmotivated. That’s a huge amount of people where financial wellness is an important part of mental health,” says Campbell.

The survey asked respondents to comment on how their debt level affects other aspects of life, including “prevents me from going out” and “loss of sleep.”

Economists and central-bank experts have raised red flags about rising household debt levels across Canada and especially noted the more pronounced situation in its more expensive housing markets such as Metro Vancouver.

Across Canada, more millennials or respondents in their early 20s to mid- and late 30s reported toxic feelings (shame, guilt and frustration) about being in debt. They’re the ones carrying higher levels of unsecured debt compared with other age groups and are more likely to be hit by low cash flow and unstable employment.

Some 26 per cent of all millennials (not just those in debt) said they have ended a relationship due to a financial issue compared with 16 per cent of all ages who reported this.

But, in the last few years, a belief in Metro of ever-rising home prices has been another contributor to some taking on increasingly worrying and stress-inducing debt levels, according to the local real estate agent.

“Imagine someone buys a home with $200,000. It went to $1.3 million and they bought (a fancy car) for $100,000 and did a reno for $200,000. Now, they owe $1.1 million. However, what we are seeing is their homes are going down $200,000 in value to $1.1 million. They have completely gone the wrong direction and have more debt than ever and zero equity.”

“It’s true. We don’t talk about our financial situations. People are ashamed. They feel like a failure,” says Campbell.

“It can make them feel like they are in a trap.

“What we want is for them to feel there is a soft place to land where they will not be judged. When people seek counselling for debt, it can be a huge load off. They can sleep and go to work and not worry about (debt) collection calls. They can turn around and be confident.”