Debt worries not just a financial but an emotional issue
Wednesday, 06 February 2013 07:12

Unresolved debt can be factor in depression

by David Portney

    Do you feel like your debt is dragging you down?  Does it bother you so much that you are not able to shake the blues or are having trouble eating or sleeping? 
    These are all symptoms of depression. A recent study from the University of Wisconsin found that when the dollar amount of a person’s debt increases by 10 percent, depressive symptoms increase by 14 percent. 
    If you are young, you may not worry as much about your debt, thinking that you have many years to pay it off. But if you are between the ages of 51 and 64, worries about debt can be a heavy burden. 

    There are two types of debts:  long-term, like mortgages and student loans; and short-term, like credit cards and medical bills. 
    Strategies are available to the consumer to deal with both types of debts.  This article will deal with the short-term debt and we will talk about long-term debt in another article. 
    Whether young or closing in on retirement, the greatest enabler of depression is inaction. The worst thing that you can do is nothing.
    For example, credit card debt is often sold to collection companies that are sometimes referred to as debt buyers. 
    A recent Federal Trade Commission report analyzed nearly 90 million consumer accounts held by debt buyers, with a face value of $143 billion (It is estimated that the total amount of credit card debt in the U.S. is $693 billion).  According to the report, consumers only disputed 3.2 percent of debts that collection companies are attempting to collect upon.    
    That means 96.8 percent of consumers are doing nothing when a collection company contacts them and begins collection procedures. 
    Is it any wonder that people are depressed about their debt? 
    The FTC report further concludes that only 50 percent of the disputed debt could be verified, which means that half of all persons who disputed their debt paid nothing. 
    It is very important that you take action when a collection company contacts you or files suit against you. You should seek professional legal guidance and counseling regarding your creditors’ attempts to collect money from you. 
    Remember that doing nothing may not only lead to your wages being garnished or your bank account frozen, but may lead to the more serious problem of depression.
    This information is general in nature and should not be considered a substitute for personal legal advice which will take into consideration all relevant information relating to your individual situation. 

•David Portney is a partner in the Baltimore law firm Grossbart, Portney and Rosenberg, P.A.