The Surprising Mental Health Benefits of Paying Off Debt
Written by
Vance Cariaga
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Getting deep into debt isn’t just a financial problem — it also contributes to mental and physical health issues. People with heavy debt are more likely than others to suffer from stress, anxiety and depression. This creates a snowball effect that makes the problem even worse over time, because debt-induced stress can lead to further financial mistakes and mismanagement.
As the National Institutes of Health (NIH) noted in a 2019 report1, chronic debt “impairs psychological functioning and decision-making, contributing to the poverty trap.”
Because debt can cause mental health issues, it stands to reason that paying it off can improve mental health. Becoming debt-free has numerous mental health benefits, ranging from less stress and more confidence to a sunnier outlook on life.
In that same report, the NIH stated that people who pay off debt “experienced greater improvements in cognitive functioning” and “reported less anxiety.”
Before you can reach that point, however, you first have to take steps to get there. A blog post from Equifax2 recommends the following:
- Review all of your debts.
- Review your credit reports.
- Determine what you can pay off each month and budget accordingly.
- Contact your creditors to see what can be worked out to make your debt more manageable.
- Connect with a credit counseling service.
Where to Start
The best course of action is to pay off your debt altogether. An often overlooked strategy to become debt-free is debt relief, in which a company negotiates with your creditors so you can pay a settlement, often a lump sum of money, that’s less than what you owe.
One company that offers award-winning debt settlement solutions is National Debt Relief. Since its founding in 2009, National Debt Relief has helped more than 550,000 people resolve more than $11.5 billion in debt. It’s accredited with the Better Business Bureau and has an A+ rating, and it was named the top-rated debt settlement firm in 2023 and 2024 by Forbes Advisor.
National Debt Relief puts a big priority on spending time with clients to discuss their overall financial situations. It then develops customized plans to meet individual client needs.
National Debt Relief can help cover most unsecured debt and will negotiate with major credit card issuers and banks to reduce debt loads. Here are some of the debt categories its services cover:
- Credit Cards
- Personal Loans
- Lines of Credit
- Medical Bills
- Collections
- Business Debts
- Certain Student Debts
How Debt Relief Works
Here’s how it works: First, tell a Certified Debt Specialist at National Debt Relief a bit about your situation in a free, no-obligation consultation. Then, if you’re eligible and interested in their program, they’ll put together a customized plan that’s right for you and your budget.
With debt settlement, National Debt Relief’s experts will negotiate directly with your lenders on your behalf to agree on a reduced balance, so you could pay less than what you owe and get out of debt much faster.
With debt consolidation, all your debt will be combined into one new loan, ideally with a lower interest rate. This will help you pay off your balance faster and save you money on interest payments in the long run. National Debt Relief’s experts will help you weigh the pros and cons of all your options.
Bottom Line
Debt can have surprising impacts on mental health. If you want to take the first step in becoming debt-free and relieving some of the stress and anxiety that goes along with carrying debt, it’s simple to get started here.
It takes just a few minutes to set up a free, no-obligation consultation to see what your options are. You could pay off your debt for much less than you actually owe.
1 https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6462060/
2https://www.equifax.com/personal/education/credit-cards/articles/-/learn/impacts-debt-mental-health/
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