It’s no secret that tax debt wreaks havoc on your finances. Unfortunately, the effects run far deeper.
The very presence of debt can influence how you think and behave. It’s associated with depression, anxiety, and a whole host of other mental health issues. Unfortunately, these can prompt inaction, thereby creating a downward spiral of further debt and misery. The sooner you take action to break yourself out of this cycle, the better.
The Devastating Emotional Impact of Debt
Extensive research links debt with a variety of mental health concerns. A notable study conducted by the University of Nottingham’s Dr. John Gathergood, for example, revealed that participants who struggled to pay off debt were twice as likely to suffer diagnosable depression or anxiety. Unfortunately, the social consequences of debt (such as divorce or foreclosure) can make these issues that much more severe.
Breaking the Cycle
Experts often recommend the snowball approach for tackling debt. The thinking behind this is understandable: paying off smaller bills may prove more manageable — and if successful, you’ll receive a surge of motivation to help you make further progress.
Unfortunately, this approach doesn’t necessarily work when dealing with tax debt, which tends to carry harsher penalties. Still, it’s possible to take baby steps, which will provide the momentum you need. Chief among these: IRS installments, which allow you to tackle your debt a little at a time.
The right mindset can do wonders for your financial situation. Often, it helps to seek an outside perspective. That’s exactly what you’ll find with the Highland Tax Group, which can help you take the necessary action to resolve your debt issues and associated concerns. Reach out today to learn more about our compassionate, yet proactive approach to tax resolution.