Credit Repair and Your Emotions

It is a subject that few people discuss, but more and more therapists are talking about it – the key link between our emotions and our money. We may think that money is all about our rational selves, but in fact our emotions are often very much invested in our pocket wallets.  

If we want to repair our credit, we have to deal with the emotional as well as the numerical side of money. There are a few tips that financial experts now believe can help you harness your emotions in a way that can actually help you improve your credit score:   

Give Yourself a Break:
There is no point in beating yourself up over your credit score – whatever it is. Instead, promise yourself that you will do better in the future and then work to repair your credit rather than working on berating yourself. Taking action to improve your credit rating will improve your outlook as well as your credit.   

Don’t make excuses:
If you have been the object of identity theft or have genuinely been mistreated by a company, then by all means include an explanatory note in your credit report. However, most lenders do not want to hear a lot of excuses. Whatever your problems have been in the past, you will seem like a much more reliable lender if you focus on what you are doing to get out of problems.

You will feel better and get better responses from lenders if your focus on current action rather than past mistakes. Instead of wallowing in pity and explaining in great detail the personal and financial problems that led to a bad credit rating, give yourself and lenders the condensed version and then move on to a detailed review of what you are doing to repair your credit.

Give Yourself a Treat – without affecting your credit rating:
Reestablishing good credit is hard work and daunting as well. Once in a while, as you reach a milestone, you need to reward yourself. You should do this through some means that do not involve debt or money. If you repay your credit card bill, there is no sense in running up that bill again on a shopping trip.   

Instead, you should list some inexpensive and fun treats you could give yourself. Keep this list wherever you keep your financial file. As you reach a big milestone, take out your list and immediately reward yourself with one of the items on the list. This will not only keep you motivated, but it will inexpensively keep you from feeling too deprived while you work on your credit score.

Work on your emotional response to debt and money:
Most of us carry a lot of emotional baggage with us when it comes to money. We see money as a marker of success, or we see money as a way of making ourselves feel better, and these attitudes lead us to much of our financial and credit problems. If we rely on money to make us feel successful, then we are apt to overspend. If we fear money – or the lack of it – we are unlikely to save it or make investments with it. 

We need to be aware of the ways we respond to money and the ways that those responses shape the ways we deal with money. Some financial experts recommend that clients keep money journals, in which they record their money hopes, their money fears, and their responses to spending and money. A money journal can help you by showing you how feel about spending and about money. If you can isolate the emotions that influence how you spend money and how
you make your money decisions, you will be well on your way towards fixing your financial problems.

Don’t mix debt with emotion and stay aware of your emotions:
It pays to separate your feelings of worth and your emotions from your finances, especially when you are trying to repair your credit. Feeling self-pity, shame, fear, or sadness as you try to repair your credit score won’t help you. Staying calm and professional as you deal with credit bureaus and financial professionals will help you. If you need to, keep telling yourself that your credit
score is just an important number. Keep it separate from yourself and your emotional state as far as possible.

Bad credit can be emotionally trying, and boosting your credit can be daunting and difficult as well. It is important that you keep track of your emotions during the process. If you find yourself dwelling on your credit too much or if you find yourself severely depressed, seek help at once. A credit problem is a fixable solution – do not let it become an emotional disaster for you. 

Get help if you need it:
Do not be afraid to ask for help – financial or emotional – if you need it. There are a number of wonderful organizations that can help you if a problem is causing your credit problems. If you have credit problems due to compulsive overspending, for example, Over-Spenders Anonymous can be a great help.

If you suffer from a gambling problem, there are a number of charitable organizations that can help you overcome the addiction. If you have accumulated debt as a result of these sorts of specific problems, you will not really be able to fix your credit rating unless you deal with the problems behind the bad credit. Many good groups and therapists out there can help you. 

Find a recommendation for a good one from your family doctor or a trusted friend or family member. You will be glad that you did.