The smart way to better manage your money.
Emotional intelligence is essentially the ability to manage emotions – your own and other people’s. It includes skills such as being able to identify those emotions, to harness them and to control them. Many experts believe that getting into debt is often driven by various emotional triggers. Which is why, if you want to get out of debt, emotional intelligence could be useful in helping you do it.
How emotional intelligence helps with debt
Make better financial decisions. Honing your emotional intelligence will enable you to control emotions when it comes to money. So, you’ll be much less likely to splurge when you’ve had a bad day or to feel overwhelmed and look for a solution at the shops. It enables you to slow down and consider what’s troubling you, problem solve and work through things before you make any decisions financially.
Be more proactive. A high degree of emotional intelligence is usually accompanied by being more proactive. So, you’re much less likely to stick your head in the sand when it comes to debt if you’re emotionally intelligent. This kind of intelligence makes a person much more likely to face up to a difficult situation like overwhelming debt problems and to start doing something about it before it becomes unmanageable.
Embracing difference perspectives. Being emotionally intelligent gives you the ability to see situations and arguments from the point of view of others. It means you have a more calm and rational approach to understanding different perspectives and can a see of facts from all sides. This can be extremely useful when it comes to finding solutions to debt problems such as paying high rates of interest on credit cards, guarantor loans or other types of secured loans. Emotional intelligence allows you to see the issue from all angles and to identify a wide range of ways to deal with it, as opposed to being limited to just one.
Tips for using emotional intelligence to get out of debt
- Start to monitor your emotions and keep track of peaks and troughs and how you deal with debt at those times
- Work on being more self aware – if you do this it’s impossible to hide from debt issues
- Check impulsive decisions and take your time instead – you’re more likely to make better decisions about money if you have time to think
- Learn how not be overcome by fear and negative emotions – being in debt is frightening and it can be overwhelming but it’s not your life forever. The less paralysed you are by fear, the more proactive you can be in solving the problem.
- Stay proactive and not reactive in a difficult situation – this will keep you moving in the right direction
- Relish the small victories – even reaching out to a debt counsellor, or paying bills on time are worth noting
- Learn how to express your emotions so they don’t become pent up – speak to someone who is upsetting you, be clear if someone has crossed the line, ask for help if you need it
- Don’t waste time punishing yourself – getting into debt is not unusual and it’s a waste of time to make yourself feel bad for something that happened in the past. Forgive and move on.