Top Merits Of Staying Debt-Free In Life
Inflation and wage stagnation do not go hand in hand. It gets difficult to survive the same wages when cost of living rises. And this scenario leads to borrowing money for survival necessities.
The entire population of the UK is witnessing this.
At the end of February 2019, people in the UK owed £1,633 billion to credit cards, banks, direct lenders and mortgages. The average total debt per household, including mortgages was £59,552 in January 2019.
According to a recent estimation by the Money Advice Service, 8.3 million people in the UK are over-indebted. Not just that. 22% of adult population of the UK has less than £100 in savings.
These numbers pose a dangerous picture of the financial bubble existing in the UK. Personal debt seems to keep going up every year, with the wage increase not so much.
Also, such statistics mean these people are highly vulnerable to any financial blow. The situation would worsen for the debt-ridden people who are unemployed or have to pay their loans on benefits.
Living under such heavy burden of debt is scary. While it is understandable why people need to borrow money at vital times, it is advisable to work hard on paying the money back.
Being debt free has advantages in every area of your life. Be it physical, financial or mental – you would find yourself in a better state of mind if you do not have a debt hanging over your head.
when you are under debt, you have no room for savings. Whatever is left of your income after your monthly expenses go towards your debt payments. In such a case, you do not have any source of funds to rely on during emergencies.
Even a minor financial shock can come as a big setback for you during your debt ridden days. Living such a high risk life is not preferential to anyone. When you are out of debt, you lead a much risky life, with reliable savings to count upon.
- Credit Score
Your credit rating is a reflection of your borrowing behaviour and every lender checks it before approving your loan application. Missing repayments and piling up debt directly leads to a falling credit score.
A lower score causes higher rate of interests offered on your borrowings. This costs you hundreds of pounds every year as interest and charges, making it more difficult for you to escape the debt trap.
When you are on time and regular with your repayments, your credit score keeps building up, and you form a healthy and appealing credit report.
- Blood Pressure Levels
When you have unpaid bills and managing with current income gets harder each day, your stress levels see a hike. You are constantly worried about repayments or losing your job.
An increase in stress directly leads to higher blood pressure levels. Your health suffers with your debt.
Getting rid of your debt is a huge burden off your head and chest both. When you do not have upcoming repayments to bother, you are much relaxed and happy.
A survey found that almost 45% of people under debt suffer from migraines, as compared to just 15% of people with lower stress levels. Constantly pressuring your brain about your financial issues just aggravates the pain.
Headaches do not affect you as much when your mind is clear of financial stress. Once you are able to sleep better, your health improves and even increases your mortality rate.
- Mental Health
People under debt have been known to exhibit symptoms of depression in some cases. Mental health of a person is affected greatly when he or she is unable to make both ends meet.
Financial troubles affect a person more than anyone can anticipate. The constant fear of losing a job, being out of money, calls from the lender, legal action being taken and not being able to afford necessities puts a person in jeopardy. Suicidal tendencies have also been known to exist in such people. There have even been instances of people committing suicides to get out of debt.
- Self Esteem
People who go out of their budget to
live a life to fit in the society often end up in a financial pit. While the outside
picture looks beautiful, the painting inside ruins the confidence and
self-esteem of a person.
When you are a person surviving on benefit support and you still had availed doorstep loans with no credit checks, it can take a toll on you when your monthly income falls short of affording the repayments.
Living within spending limits and being responsible about paying off what you owe keeps a heavy burden off your chest. You do not drown yourself into money worries. There is no fear of authorities knocking at your door asking for money.
With such positivity, your inner peace and esteem levels automatically rise. You are a much happier and positive person to be around.
Taking a debt is not a bad thing, but going beyond your affordability is. Your health and finances suffer massively when you are trapped under a debt.
A debt-free life is a happy and relaxed life. You even have a savings fund for your rainy days. Borrow only what you can repay. Stay debt-free, stay stress-free.
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