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Debt addiction, as commonly called, is better termed as compulsive borrowing. Being in debt is certainly not pleasurable, and no one takes out a loan intending to get addicted. But the truth is, borrowing beyond one’s means is often the start of a slippery slope.


Debt addiction refers to a repeated pattern of borrowing money or taking out loans in order to solve financial, personal or family troubles. The struggling person is often in debt, or stuck in a vicious cycle of borrowing to repay debts. They typically do not a plan for getting out of debt or changing their lifestyle.[1]



Some of the signs are:[2]

  • Faces unhappy situations at home due to the debts

  • Has had one’s daily work or job affected by the debt pressure

  • Makes unrealistic promises about repayment to creditors

  • Feels relief at the prospect of borrowing when facing financial trouble

  • Lies in order to borrow or take a loan

  • Borrows without considering whether one can afford the interest repayment

  • Is afraid of other people knowing about one’s total debt situation

  • Has been unsuccessful in sticking to a repayment plan

  • Neglects welfare of the family due to the debt pressure


Having debts does not mean that one has a debt addiction. Many people take out housing or car loans, and some run up credit card debts after losing their job. However, debt addiction is associated with a mindset of being unrealistic about one’s financial situation and ignoring consequences. As a way of coping, the struggling person develops an unhealthy reliance on borrowing and a high tolerance for indebtedness.


Debt addiction also differs from other forms of addiction. A person could struggle with compulsive gambling or spending but not resort to borrowing. Nevertheless, they often co-occur together. Chalking up debts to feed these habits is a clear sign of having lost control. In addition, having mounting debts could worsen other addictions. The pressure from being chased by creditors could drive the struggling person deeper into his/her gambling or spending habits to find temporary relief.  


Mrs. X comes from the working class. She borrows money from her friends to spend on luxuries, such as expensive family holidays and branded goods. The following month, bills are due. In a tight financial situation, Mrs. X borrows again, this time from other friends to pay for expenses. She believes that the money will come when she receives her year-end bonus. The bonus arrives, and she repays her friends.


The cycle continues, and one day she finds herself unable to repay what she owes. However, she is relieved to know that she can take out a loan from a licensed moneylender. She does not think much about how she could repay the interest. Instead, armed with more money, she continues with her regular lifestyle.


The due date for repayment arrives. Unable to afford the minimum payment, she takes up new loans to service her existing ones. Over time, her outstanding debt snowballs into a heavy and unmanageable sum. Her family does not know how much she owes. Her debts keep her awake at night, but she knows of no other way to repay them. To her, the only way is to keep borrowing.


If this sounds like what you or someone you know is facing, help is available. Don’t let your debts control your life and your family. Reach out and seek help today.

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