How Your Credit Score Can Affect Your Mental Health

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Your credit score is a big deal.

In the U.S., it can impact everything from your ability to buy a house, rent an apartment, or qualify for a loan.

Because your credit score can impact so much, it can also have an impact on your mental health, especially if you’re limited in what you can do and purchase with a low score.

Let’s take a closer look at exactly how your credit score can affect your mental health, and what you can do to give both a little boost.

The Poor Credit Cycle

If you’re trying to reach certain goals in life and your low credit score is preventing that, it can lead to excess stress and even depression. Or, you might develop anxiety wondering if you’ll ever be able to reach your goals.

It’s not uncommon for low credit scores to feel like a barrier. Many people who have poor credit also deal with debt. That combination can make you feel both hopeless and helpless, leading to issues like:

  • Negative sleeping patterns
  • Difficulty focusing
  • Physical stress
  • Increased risk of irresponsible behavior

Unfortunately, research has shown that people struggling with mental health issues are more likely to have problems managing their money. It can quickly become a vicious cycle between feeling overwhelmed by your poor credit and making financial choices that make things worse.

Working with a financial advisor or credit counselor can make a big difference in helping you break that cycle, especially if you’re struggling with your mental health. Additionally, there are some positive financial habits you can put in place to improve your credit score and obtain your financial goals.

Improving Your Credit Score and Your Mental Well-Being

Obviously, your credit score and mental wellness aren’t exclusive to one another. But, if poor credit is keeping you from reaching your goals and moving forward with your life, it could be fueling any underlying mental issues you’re already struggling with.

So, what can you do to boost your credit while prioritizing your mental health?

First, prioritize which credit cards to pay off first. Consider paying several times throughout the month to keep your balance low as you work toward eliminating your debt. Second, pay bills on time. If you need to boost your credit fast, ask to be an authorized user on a family member or friend’s credit card, but only if you’re able to pay for the things you purchase on it.

Finally, make sure your credit score isn’t in jeopardy because of security issues. If someone gets ahold of your credit information, they can steal your identity and wreak havoc on your credit score. Be sure to shred any credit card statements or receipts with your credit card number on them to keep yourself safe.

Most importantly, show yourself some compassion. Even if your credit score falls, it isn’t the end of the world. Self-compassion can go a long way in improving your mental health and helping things to feel less hopeless. You’re human, and you might have made some mistakes with your credit in the past, but there’s nowhere to go but up. Having that kind of compassion can boost your confidence, reduce your stress levels, and help you see a brighter, less anxious future with attainable goals.