In a 2015 CBS News report, it was revealed that money is the leading cause of stress in America. As for us Filipinos, finances rank third on the list of stressors.

In an open online poll conducted by CNN Philippines, some 14.5% of the respondents said that money makes them stressful. This includes the following:

  1. Financial uncertainty
  2. Credit card bills
  3. Utility bills
  4. Lack of budget
Related article: 6 Warning Signs That You’re an Overspender

There are many reasons Pinoys overspend. But when you overspend, you use the money meant for more important things. If you don’t take control of your overspending, you will soon end up with serious consequences.

1. It Hurts Your Credit Score

Maxing out your credit limit and paying only the minimum can lead to balances. When you have too much debt, you tend to pay your bills late or skip it at all. Thus, lowering your credit score.

Banks advertise that they accept minimum partial payments. And people are misled into thinking that it’s fine not to pay the items in full.

Remember: Credit cards have ceiling interest rates. A partial payment may save you from late payment penalties, but it will still incur interest rates until you settle your balance.

Credit scoring calculation considers credit utilization (credit card balance is to credit limit ratio) for each of your credit cards. Meaning, the more credit balance you have in relation to your credit limit can hurt your score.

When that happens, it’ll be difficult for you to get a new credit card or apply for a loan.That’s because lower credit score can lead lenders to decline your loan application.

2. It Compromises Your Health

The way you handle money and how it can affect your health is like “chicken and egg” situation.According to Dr. Dina Bowman of Brotherhood of St. Laurence:

“Often health concerns can trigger financial distress, say if someone can no longer work because of an illness. But financial worry can in turn trigger health concerns, as people unsurprisingly become distressed and anxious.”

Finance-related stress can affect your appetite, mood, ability to focus, as well as increase your blood pressure. This makes you at risk of heart attack, heart disease, or stroke.

Moreover, poor financial management can deplete your funds for basic needs and emergencies. This can cause you to avoid seeking proper healthcare.

When you’re the one carrying the financial burden, you tend to neglect health in order to save money. You may even go as far as avoiding proper healthcare because you can’t afford to pay it.

In the US, about 9% of Americans considered removing healthcare from their budget according to American Psychological Association’s (APA)2014 “Paying With Our Health” report. Here in the Philippines, however, the Philippine Information Agency reported late last year that 92% of Filipinos were covered with health insurance.

3. It Ruins Your Relationship

As mentioned in a previous post, borrowing money from other people and being unable to pay can ruin your relationship. In fact, the 2016 Pru Life UK’s Prudential Relationship Index reveals that 46% of married couples argue about money.

In relation to this, APA points out that differing beliefs about money can cause conflict:

“Early on in a relationship, many couples discuss their view on marriage, children, and where they want to work and live. Unfortunately, couples rarely sit down together to talk about their financial beliefs and goals.”

Moreover, Jeffrey Drew of Utah State University points out that consumer debt can make a marriage crumble.

“Consumer debt fuels a sense of financial unease among couples, and increases the likelihood that they will fight over money matters; moreover, this financial unease casts a pall over marriages in general, raising the likelihood that couples will argue over issues other than money and decrease the time they spend with one another.”

Bear in mind that your upbringing affects the way you spend and save money. Your money management skills are something you learned from your parents and other family members while growing up. And these financial beliefs and goals become inherent way before you comingle your finances with a partner.

4. It can Damage Your Career

Aside from your personal life, overspending can also have an adverse effect on your career. As mentioned earlier, mismanaging your finances can cause stress and it can stem into all aspects of your life—including your work.

For one, your ability to focus on your job will suffer. That’s because you’re always preoccupied with how you’re going to pay your bills. Unhealthy money habit, thus, can lower your productivity. If you don’t take action, it can jeopardize your career.

There are also cases when creditors will call your colleagues due to late payments. And that will put you in an embarrassing situation. Meaning, overspending can haunt you even when you’re at work; and despite the fact that you can compartmentalize your financial stress.

The worst that could happen is wage garnishment. The payroll department will deduct the payment from your salary and forward it to the people you owe. Otherwise, the company will face legal repercussions.

If you’re a job seeker, some employers conduct a background check on their applicants—and this includes looking into your credit history. When you have an overwhelming amount of debt, companies will tend to mark you as someone who’s unorganized and unreliable. As a result, it lowers your chances of landing a decent job.

5. It can Cause You Your Life

In a 2016 study released by Payoff, 23% of Americans experience financial stress with symptoms similar to post-traumatic stress disorder (PTSD).

Another study from the University of South Hampton reveals a correlation between mental illness and financial problems. It was concluded that people with debt are likely to have mental health problems. Among them are depression, anxiety disorders, and psychosis.

There’s even higher link between debt and suicide. In fact, it was reported last May that two men from Pangasinan committed suicide due to financial problems. On the other hand, about 50% of people struggling with debt in the UK have considered committing suicide.

Often, the financial burden is too much to bear that suicide becomes the only option. People with debt consider “ending it all” because they couldn’t see another way. What they didn’t know is that suicide won’t erase their debts. Worse, it’ll cause a burden to the family members who’ll be left behind.

Aside from mental health issues, people with financial stress tend to be alcoholic and drug dependent. Unfortunately, debt, depression, and addiction often reinforce each other. According to DrugAddictionCenters.org:

“Credit card debt can contribute to depression, which can then lead to addiction as people seek relief. Inversely, depression may contribute to or be a result of addiction; also, addiction often leads to financial instability which may include credit card debt.”

Regardless, depression and addiction usually go together; and require professional treatment.

Overspending Leads to Lifetime of Consequences

As finance blogger, Trent Hamm, puts it:

“If you spend money today on something purely impulsive, you won’t have money to spend tomorrow on something genuinely important to you.”

Related article: 9 Ways to Fix Your Overspending Problems

Good thing, there are little things you can do to curb your spending. This includes understanding what makes you buy stuff on an impulse; as well as finding ways and seeking help to discipline yourself in terms of handling your money.

Otherwise, you’ll find yourself alone and forever drowning in a sea of debt.