Excessive Spending and Mental Health: Debt Management Plan

What do you do when you have a mental health condition which makes excessive spending more likely? Bipolar Disorder can lead to needing a debt management plan, and I hope my ideas based on my experience will help you.

I have created an article that I will be following after a recent bout of hypomania has seen excessive spending on my part, and I need to get it under control.

Now, my last resort, because of pride, is to get someone I trust to manage my finances, but I haven’t got to that stage yet, but I won’t rule it out. Sometimes it is the best option, as it will cause the least stress for you in the long run.

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In my case, and as I have written about before, I will opt for the medical forms to send to my creditors, and if this does not work, I will apply for a debt relief order.

However, I am determined in the meantime to pay back as much as possible. But to do that, I need a debt management plan, and this is where I will store it on my website. I hope it will be useful for you.

Excessive Spending Cut Off

The first thing I will be doing is cutting up my credit cards and also deleting any stored numbers from websites. In one of my previous articles, I mentioned remembering the three digits on the back and with some of my cards, I remember those numbers. So before I cut them up, I need to claim them as lost, so I’ll get a new card sent through, then I’ll cut it up without looking at the back of it.

I then will need to work out my budget. This will prove tough as reality sets in; how much money am I going to have to repay monthly to clear my debt. How much has my excessive spending cost me? It is something I dislike doing, as it hones in on how disastrous my finances have become.

But, it needs to be done. I use the Money Savings Expert budget planner; you can find it here on his website. I often go on this website to help me discover new ways to save money, but lately, I’ve had to avoid it because of hypomania. I start applying for credit cards.

So be warned if you are hypomanic, do not visit the site. Work out your budget on a piece of paper, but I doubt you’ll do that as if you are anything like me when hypo, you are not concerned with future debt, only the compulsion to spend.

Consolidate Debt

This is a great option if you are out of a hypomanic state; I made the mistake of consolidating my debt and not cutting up credit cards. Lo, and behold, I ended up with a loan and credit cards; you can guess the outcome.

Do not consolidate when hypomanic.

There are times when it is good to consolidate, and this is when you are stable or when you have someone else looking after your finances. But before you do, you need to work out your budget to make sure you will be paying less out than what you are paying out currently.

Individual Voluntary Agreement

If your excessive spending has led you to have a poor credit rating and cannot consolidate, then look at IVA’s; this is a debt solution where you arrange with your creditors to pay off your debt. It is best to get a company to do this for you, but they will get a reduced payment amount.

It will affect your credit history, but to be honest, the less likely you are to get credit, the better as you cannot overspend if you don’t have access to money.

An IVA is for unsecured debt; if you own your own home, this option will not suit you as you could sell your home and downgrade to pay off your debt.

Another bonus is that once you enter an agreement, the creditors will no longer send you letters or make phone calls.

If you are using a company to organise the IVA, they will charge you, which is normally added to the monthly repayment amount.

Debt Relief Orders

I have spoken about these in a previous article which you can read here. I used a DRO back in 2013, once again after an episode of excessive spending, and I’m so glad I did. You have to pay an upfront fee, and you will need an expert to help you organise it. I used the Citizens Advice Bureau, and they took care of everything for me, except paying a fee to get the DRO, which was under £100; At the time of writing, it is currently £90.

To qualify for this, your debt needs to be under £20,000, and you have less than £50 left after you’ve paid out your household expenses, such as food, gas and electricity etc.


If your debt exceeds £20,000 and the above options are not suitable for you, then this may be the way to go. It will cost you though, at the time of writing it is about £680 in the UK.

Before considering this speak to an advisor either with the Citizens Advice Bureau or Step Change. They are far more knowledgeable than I.

What Have I Learned About Excessive Spending

There is no room for shame, you have a mental illness, and excessive spending can be a part of it and, just like you can’t stop sweating when it is hot. For some, like you and me, spending is a compulsion based on various chemicals in our systems.

In an ideal world, we would not have a credit system. Therefore it would cut the options down, but we do. As bipolar person, if we could not spend, we would end up doing something else when hypomanic or manic, such as ruining our relationships with sleeping around or other risk-taking situations.

Also, I have learned not to keep it to myself. I used to years ago, and the stress of it caused problems with my illness. You need to speak to people about it, even if it an expert from the debt management organisation. Ideally, it will be a family member who you trust, as it is a big step to admit that you have lost control.

The main thing is not to feel guilty about it; it happens to the best and worst of us. And remember, no matter how much debt you are in, there is a way out to give you peace of mind. Don’t mither about it, and please don’t consider self-harm to be rid of it; there are far better options.

I wish you peace and blessings

Lou x

i'm not a doctor

Lou Farrell

Welcome to the mental health blog of Lou Farrell. I am a writer and copywriter who pens all manner of articles relating to mental wellness and mental illness. I write about my own experiences and the knowledge I have gained over the years as someone who has bipolar disorder. I hope you enjoy the website :-)

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