Know Your Customers: The 5 Most Common Obstacles to Overcoming Debt

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June 29, 2017 | By RGR Marketing Blog

Your Customers Are Facing These Debt-Related Obstacles

If your customers struggle with debt, there’s a reason. Borrowing money can be a useful tool, but if someone continues to borrow more than they can pay back, that can quickly become a real problem. You know this, because the simple fact has created a job, and even a career in the debt settlement business for you and your colleagues.

It’s important to be fully aware of the obstacles that your customers face – the things that led them into debt in the first place, and the things you will need to help them solve to keep them out of debt in the future. Even when your customers realize that debt is overwhelming them and must be addressed, they often struggle to get rid of it. Why? Well, there are many reasons, but here are five of the most common obstacles to overcoming debt.

1. Lack of Impulse Control

One big problem that keeps people in debt is lack of impulse control. They see something they want and they buy it. We are constantly being marketed to and credit is relatively available, so people may quickly get into the habit of just buying whatever they want, whenever they want, a practice that often comes back to haunt them. The best solution to this problem is for them to track spending and stick to a budget.

2. Inability to Ask for Help

Some people may feel that their debt problem is insurmountable and no one can help. Or that someone can help but they won’t like the solution that person offers and they will feel obligated to follow it. The only way to overcome this is to reach out to the person in debt, let them know that debt is a common problem that one does not need to be embarrassed about, and that there are solutions that, if not painless, are still manageable.

3. Not Thinking Debt Is a Problem

Some people feel that everyone has debt and therefore, it’s not a big deal. It’s important to show these individuals the affect that debt is having on their life in the present, and how it could impact them in the future to motivate them to make the right decisions regarding their debt.

Even if they’re not at the point where creditors are calling them on a daily basis, debt can have a negative impact on a person’s life. This includes within areas such as the money they waste making interest payments and the effect on their credit, which could make it difficult for them to make major purchases like a car or a home where some credit is usually required because of the size of the purchase.

If you can frame debt this way for an individual, it may motivate them to take a more serious look at their debt and what they can do about it.

4. Not Seeing How They Can Make Progress

When a mountain of debt gets large enough, many people give up. This is called the Snowball Effect and it’s not uncommon. However, a debt snowball can be counteracted with a payback snowball. The more you pay back, the easier paying back gets as principal and interest both go down. If you can communicate this to the person in debt, it may encourage them to give overcoming debt a fair shake.

5. Inability to Budget

Budgeting is an important step in solving debt problems, but if you’ve never made a budget before, or you’ve never been able to stick to one, you may feel like all is lost. It’s true that if you can’t make a budget and stick to it, you will struggle to overcome your debt, but it’s also true that anyone can make a budget and stick to it if they choose to do so.

Direct your client to the many tools that now exist to aid with budgeting, from online budgeting programs to mobile apps that help keep you organized and even gamify budgeting, making it easier and even fun.

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Your Customers Are Facing These Debt-Related Obstacles

1. Lack of Impulse Control

2. Inability to Ask for Help

3. Not Thinking Debt Is a Problem

4. Not Seeing How They Can Make Progress

5. Inability to Budget

Start making more
money today!

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Your Customers Are Facing These Debt-Related Obstacles

1. Lack of Impulse Control

2. Inability to Ask for Help

3. Not Thinking Debt Is a Problem

4. Not Seeing How They Can Make Progress

5. Inability to Budget

Start making more money today!

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