3 Reasons Why People With ADHD Go Into Debt and Simple Strategies To Get Out of Debt

Do you feel like your money burns a hole in your pocket?  Do expenses that happen every year tend to sneak up on you? If you struggle with money management, you’re not alone.

A 2022 survey by Monzo in the UK showed that adults with ADHD are three times more likely to struggle with debt than their neurotypical friends. The same study showed that people with ADHD are four times as likely to impulsively spend.  But there is hope!  Read on for some possible reasons why you’re struggling, and what you can do to overcome those money management challenges.

Three Reasons Adults with ADHD Go Into Debt

ADHD debt doesn’t have to be a life sentence, even though it may feel like it. Identifying specific reasons why you struggle with money is the first step. Once you understand how the debt happened, together we can help you figure out how to overcome those challenges. Let’s break it down.

1. Impulsivity

It’s easy for people with ADHD to fall into the trap of impulsive purchases. It seems like a great idea at the time…swipe! We tend to act before we fully think our financial decisions through. This can lead to increased debt.  Consider utilizing our accountability partners ADHD digital community or work with a friend to come up with a plan to help you slow down.

2. Poor Organization & Time Management

People with ADHD tend to struggle with keeping track of bills & due dates.  This can make it difficult to manage financial responsibilities effectively.  Late payments, missed bills, and financial disorganization can lead to late payments and higher interest rates, increasing the amount of money owed.

 3. Difficulty Focusing on Long-Term Goals

“Out of sight, out of mind” doesn’t just apply to physical objects.  It also applies to our money.  Expenses that are far off in the future (new car, kids’ college, retirement?!) are easy for people with ADHD to forget about, because they’re not “right here, right now”.  But this also can lead to getting into debt, because you’re not thinking about all the places the money you do have should actually be going.  It can also be more difficult to get out of debt, because paying off debt often can take years of dedication.

ADHD Money Management: Simple Strategies To Pay Off Debt

It’s important to identify why you have gotten into debt and how your ADHD may be keeping you in debt. Now you can utilize these simple strategies to defeat your ADHD debt.  Make it easy!

1. Create Structure To Manage ADHD

Set up a routine that includes time to pay bills, record transactions, and reconcile your accounts.  Our ADHD Money Coach Stephanie says,”Once your money is organized, it shouldn’t take any longer to manage your money each day than it takes to brush your teeth.”  Some of her clients review their budgets over their morning coffee, while others sit down with their spouses after the kids have been tucked into bed.  It doesn’t matter when you look at your budget.  The most important thing is actually doing it.

2. Develop a Budget and Track Expenses

A budget isn’t just a list of your expenses.  Nope, you need to start with the money you have in your account right now, and figure out what’s coming up that you need to pay, including things that don’t have due dates like gas & groceries.  Don’t forget the dog food!  Subtract those things from the amount in your account.  When you get to $0, you’re done until the next pay day.  Then you repeat the cycle.  But that’s just half way to making and sticking to a budget.  The final piece that’s imperative for success is to track your expenses against your budget.  This helps you see through the course of the month how much money you have left in your categories.

3. Work With Your ADHD Brain

Not sure where to start setting up a budget or what system might work best for you?  Look at other areas of your life to see how you’re keeping track of things.  Do you use a pill container to keep track of your medications? Yes? Then you might do best with a cash envelope system. If you write your to-do lists with pencil & paper, you might find success making your budget the same way.  If you track your appointments on a digital calendar, put your bill due dates there too!  If you use apps to remind yourself of things, using an app for your budget might (eventually) feel like second nature to you.  The point is… there’s no one “right way to budget”.  You need to do what works for your brain.

An Adult With ADHD Who Struggles To Get Out of Debt Might Need a Money Coach

If you find yourself struggling to make a plan for your money, or how you’re going to pay off your debt, you may benefit from working with a money coach who is familiar with ADHD & budgeting challenges.  A Money Coach can help you make a plan for your money, devise a plan to pay off your debt, and then help you stick to that plan, despite your ADHD. Once you have a money management plan in place to pay off your debt, you’ll avoid unexpected expenses, and be able to make progress paying off your debt. 👏🏽 

Speaking of that, I think that every ADHD adult should book a complimentary call with Money Coach Stephanie Berman – she is changing lives! (Psst: This is one of the times that I will tell you it’s actually ok to make the impulsive decision – you’ll be so happy you did!)

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About Ryan Mayer

Professional Life Coach Ryan Mayer is an Accountability and Mindset Coach, specializing in working with adult men and women with Attention Deficit Hyperactivity Disorder (ADHD).
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