Positive thinking is part of the strategy of paying it down.

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Loving your debt sounds like an oxymoron. The reality is that it doesn’t have to be.  Learning to make friends with – and even love – your debt is one of the most effective ways to manage it and make it work for you.

Debt is undoubtedly stressful. It can permeate your thoughts and can create both mental and physical health issues. So how could it be possible to love something that seems so inherently negative and brings about so much pain?

It’s all how you look at it. Learning to love your debt doesn’t have to mean that you like having to pay bills and that you love that you owe people money, but you can look at the process as one that works for you instead of against you.

Loving your debt is more about recognizing the situation you’re in, taking ownership of it, being grateful for what you have and recognizing that someone thought so much of you as to give you credit for something to buy that you wouldn’t have been able to have it without their generosity. You start to realize that paying down your debt is a form of self-care.

To learn to love your debt, you’ll need a better understanding of good and bad debt, strategies for dealing with bad debt, and how to feel more positive about the entire process.

Good debt vs. bad debt

In many cases, certain types of debt (i.e., credit card debt) and the word debt, in general, are deemed “bad,” while other types of debt such as mortgages or debt you took out when you needed cash are considered “good debt.” However, in reality, defining debt as good vs. bad boils down to how you manage debt. Therefore, you have control over whether your debt is good or bad.

Starting out, any kind of debt – credit card debt, mortgage debt, student loan debt – is good because it helped pay for something you needed. Your home, car, education, and perhaps even food were likely paid for with credit. Those purchases were inherently good and gave you something to feel happy about and something to take care of you and your future. That good debt can go bad if you do not pay the bills on time, have enough money to pay it or simply have too much of it. Bad debt doesn’t denote a certain type of debt, simply debt that’s being mismanaged. Bad debt occurs when your debt has gotten out of control. It’s when it becomes that stressor when it starts creeping into other parts of your life, when it starts causing problems including and beyond financial issues.

Debt is part of life. Aiming to be completely debt-free is a wonderful goal, but for many of us, it’s simply not realistic. Cutting spending or credit use cold turkey often isn’t a reality. Instead, start looking at your debts from a different perspective and categorize it as good (it’s working for you) or bad (it’s working against you). Once you know your debt, it’s time to take control and start managing it correctly to fit it comfortably into your lifestyle and monthly budget. Once again, the type of debt is irrelevant here. It’s simply about how you look at it and how you let it affect you and the rest of your life.

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Turning bad debt into good debt

When you have bad debt, it may feel as though you’re drowning. “Crippling debt” is a term for a reason – it can physically and mentally cause you pain. And like with many other negative emotions, this feeling can seem like it will never go away. But it is possible to turn bad debt into good debt.

Recognize the problem

The first step in turning bad debt into good debt is recognizing how your debt went from good to bad in the first place. Try to pinpoint the cause. Were you spending beyond your means? Is your budget out of whack? Do you have a lack of cash flow? It can be difficult to admit to these problems or to take such a critical look at your financial situation. But taking ownership of your debt – and wanting better for yourself – will help you make a plan to address the problem and tackle it.

Examine your budget

Your budget is the backbone of your financial situation and a snapshot of your lifestyle. When dealing with debt, it’s important to examine your budget carefully. Having bad debt means your debt is not fitting comfortably in your budget – or that your budget is not allowing enough room to make substantial payments to reduce and eliminate your debt. Go through your budget with a fine-toothed comb. Find an area in which you can cut back, reduce spending, and increase payments to debts to pay them down. If you can’t remove any items from your budget, look for ways to increase your income and reduce expenses. It may not be easy, but it’s an important first step.

Like dealing with debt, budgeting can seem overwhelming. Budgeting is like a math problem, and not many people love math or want to deal with the whole process. As a result, many people simply avoid dealing with it. Don’t overcomplicate budgeting. Write down what you have to pay out and how much money comes in. Start simple. Then expand it and add in more detail. Keep adding onto it and stay connected to your budget until it’s in your head – you can see it and know all of the bills and the approximate payments. Revisit it often and make friends with it. Talk to it with positive energy and words. It may sound strange, but it works.

But when looking through your monthly expenses, start to say to yourself how lucky you are to have this bill and that you be grateful for each bill you’re able to pay. These bills are helping sustain your life as you know it. And freeing up funds in your budget will allow you to make greater payments to your debt. If you’re struggling to find ways to cut back, consider whether you are able to bring in more income, whether it’s through taking on more hours at your current job or finding something to do on the side.

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Make a plan

Now that you know your debt, make a date with your debt. How can you pay the bills and give enough love to the debt that it gets smaller and smaller? Decide what approach you’re going to take to make payments. Some people prefer to pay down the debt with the highest interest rate first and work their way down. Some prefer to start with the highest balance, while others begin with the lowest balance because it will be the quickest way to see results. You can also start with the debt that causes you the most stress. Getting rid of your most anxiety-inducing debt will help set you on the path to feeling more positive towards your debt.

There’s no right or wrong place to start. Once you’ve determined your payoff method, calculate how much you’re going to make in payments each month and how long it will take you to get to a more comfortable place.

Say thank you to your debt

When debt is overwhelming, staying motivated to pay it off can be difficult. Having a positive mindset can be crucial in helping you stay on track. Try to get in the habit of saying thank you to your debt and getting excited about getting your mail and bills each month. Sound insane? Think about what your debt has given you – a home, an education, perhaps even a great vacation or a financial cushion during a difficult time.

It’s all about switching your mindset. Instead of saying, “This debt is a burden and I hate paying it off every month,” say, “I’m grateful for the life debt has helped to give me and I am simply helping to repay those good things.” This simple change in thinking can go a long way. It can be the extra push you need. It can help on those days when paying your bills seems like a chore. It can help you realize instead that you’re doing something good for yourself.

Loving your debt is not easy, particularly when debt has overwhelmed you. Recognize when debt has turned sour – face it head-on. But instead of grimacing, smile. Smile for what your debt has given you and for knowing that you’re going to take care of it – and that you’ll be better off because of it.

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About the Author

Leslie Tayne

Leslie Tayne

Leslie H. Tayne, Esq. is an award-winning financial attorney and author of Life & Debt. She has over 20 years of experience in consumer and business financial debt solutions. Leslie is the founder and managing director of Tayne Law Group, P.C., a New York-based law firm dedicated to debt management, debt resolution, and bankruptcy alternatives.

Published by Debt.com, LLC