If you have recently realized that your debt is weighing you down too much, you may have also started yourself some important questions regarding the way you spend your money. Out of all these questions, one stands out though: which are the actual reasons for which a person ends up indebted, while other people can perfectly manage their finances?
The first reason is also the most obvious one: you have a low income. To make ends meet, you may feel tempted to rely on your credit card loan and you may end up indebted towards your lender. Also, if you are surrounded by people with higher income, you may also feel tempted to spend more than you can afford. Moreover, if you come from a family that has been struggling with debt, it is quite likely that you will simply accept the fact that this is just the way things work when someone takes a loan.
The second reason for which people have to carry too much debt is mostly related to your psychology. In essence, there are two types of people out there: those that know that everything they do is their responsibility and those who believe external factors to be of a much more influence than they actually are. The first ones will always shoulder the loan and carry on, while the other ones stand a greater chance to end up indebted to the point of filing for bankruptcy.
Furthermore, how efficient you think you are in a specific field can influence how you deal with that field. For instance, someone who is very good with computers will not panic when they have to fix something up in their PC. But the same someone can be a complete wreck when it comes to paying off a personal loan, basically because they do not actually believe that they can be good with finances.
Another very commonly encountered reason for which people end up carrying too much debt is the way they can cope with depression or with unpleasant events in their lives. Being a “shopaholic”, for instance, can influence your finances in the same way any other addiction can. Furthermore, once you start being burdened by debt, you will most likely cope with it by doing the exact same thing that got you there in the first place. And, in the end, the debt towards your legal money lender will reach unbearable limits.
The cycle can be broken, but the first thing to do is to realize where you are doing wrong. Accepting the fact that you can be flawed and keeping yourself focused on how much you want to change will help you to eventually overcome debt.