Because debt reduction is fundamentally a mental issue, not a financial one, this may be a different take on debt reduction that what you might be used to hearing. We’ll give some practical strategies and tactics, but first let’s figure out HOW we think about debt.

Finances are a major stressor for most marriages, so here is a checkpoint for you personally. You might already know this, but if you’re not 100% sure, sit down with your spouse and ask them what meanings they assign to debt. Ask the questions: How does debt impact you or affect you? What do you feel when you think about the debt we have right now?

I know that Caleb and I experience debt differently, but empathy comes from understanding. Caleb is more comfortable with debt, as long as he has a sense that his income will cover the payments to repay it, but because he knows that I am less comfortable with it (as in, totally-anxious, make-me-sick uncomfortable), he is very considerate and will not go into debt without me being totally on board with it first.

How we think about debt is critical, so today, we start with the psychology that you need to wrap your mind around before you think about what you can wrap your income around.

To give you a frame for background, let’s look at some research. In 2011, 63 couples with great marriages were asked about their finances.[i]

A few themes became clear showing that part of the success of great marriages is due to a careful, effective reduction of debt. Happy couples were more likely to pay off debt as quickly as possible. They were less likely to use credit cards at all, or just used them as a convenience and paid them off monthly. The couple shared the common goal of debt reduction.

Common goals are critical because if you can’t agree on this, it’s not going to be possible to move forward to debt reduction. If this is your situation, you’re either going to have to accept the reality that your spouse isn’t going to change or find another way to have a conversation about debt that your spouse can relate to. When you do that, you’re giving them a choice whether they want to act out of a place of empathy or choose to disregard your concerns. All you can do it put it out there to start with.

Another theme that showed up in this study was that some couples started with a debt-free philosophy and others came to it over time. This is helpful as you have to see yourself as creating a great marriage and get comfortable with the fact that you are in development together. Give it time – give your mutual commitment to debt reduction time to develop and shape itself in your marriage as part of your common goal settings.

The question arises though: if debt reduction is a critical part of a successful marriage, why is it so hard to actually get on the same page about it?

There are actually predictors of debt found through some extensive research studies. For example, one study found that health status and levels of changes in income are very robust predictors of debt in general.

In other words, if your health is poor and/or your income never changes over an extended period of time, you’re most likely to be in debt.

The same study found that for intermittent and chronic debt, locus of control, family structure during adolescence, socioeconomic status, work effort, and marital status are robust predictors. Self-esteem also plays specifically into chronic debt.

Anything considered to be a disadvantage in life generally is indeed a disadvantage with regards to debt reduction. Sounds discouraging… Let’s look at Locus of Control a little closer.

Locus of Control (LOC) is a concept from personality psychology that puts your personal belief about whether you have control over life or not on a continuum from external to internal. If it’s external you believe that fate, or God, or chance really initiates all the things that happen in your life. If it’s internal you believe that you have control over all of the things that happen within your own power.

Now, considering the list we just mentioned there is a lot there to speak to the external locus of control. Meaning our struggles with debt could be portrayed as outside factors, many of which we feel are outside of our control, which leads to a sense of feeling stuck and unable to change.

Watson points out that:

  1. if your LOC orientation is primarily external, you are more likely to use external controls, such as financial resources and purchasing activities to achieve a sense of control,
  2. if your LOC is primarily internal, you are less likely to misuse credit cards and much less likely to be compulsive in your buying behaviours.[ii]

Perhaps, if you have an external LOC you believe that debt is inevitable, that you need to buy what you need to buy because life just happens, or you even buy to feel a sense of control when so many other parts of your life feel out of control.

If you are in this category, you really want to pause and think about how your LOC beliefs are influencing your purchasing behaviours. It is not so much about what you actually need or want and more about how you feel about how life treats you. You’re trying to rationalize what is actually psychological and belief-oriented rather than practical and objective.

When you think of all the factors that go into debt reduction, it is crucial to stop and really think about if you have behaviours that are more driven by underlying psychology you’ve ever really considered. Engage in personal growth as a long-term strategy for debt reduction.

We know that HOW WE THINK about debt affects our financial status, but what can we do about it? Let’s get practical about how to reduce debt.


There are a couple of different ways of looking at this. The US Securities and Exchange Commission website says, “No investment strategy pays off as well as, or with less risk than, eliminating high-interest debt.

Most credit cards charge high-interest rates – as much as 18% or more – if you don’t pay off your balance in full each month. If you owe money on your credit cards, the wisest thing you can do is pay off the balance in full as quickly as possible.

Virtually no investment will give you returns to match at 18% interest rate on your credit card. That’s why you’re better of eliminating all credit card debt before investing. Once you’ve paid off your credit cards, you can budget your money and begin to save and invest.”

The website also tells you to stop using your credit cards, figure out how much you owe, and then pay off the card with the highest rate.

This works for some people, but others need to see a change to be motivated by it.


Dave Ramsey uses a different approach called the snowball method, which goes in a different direction than the US Commission’s method.

FREE TOOL: Debt Reduction Calculator

This tool allows you to enter your own numbers to get rid of your debt by creating a payment schedule that will help you see the snowball method working for you.

Dave Ramsey’s premise is similar to ours – that this is mostly about behaviour and psychology and less about math. He acknowledges that paying off high-interest loans first makes the most sense mathematically but in terms of the psychology of success, he has created what he calls the snowball method.

The snowball method is where you aim to pay off the smallest debt first to create momentum. Everything else is kept on minimum payments. When you get that smallest debt paid off, you take the payments from that and add them to the minimum for the next largest debt. As you knock off these smaller debts you’re also increasing the payment size as you move to larger debts.

It took me a few minutes to wrap my head around this and it’s hard to talk through but let me try to paint a picture:

  1. Say you have $1,000 debt on a furniture purchase that is $100/month payments. Imagine there’s no interest so that the math is simple.
  2. And you have $10,000 on a car loan that’s $500 a month
  3. Also, let’s say $30k on credit cards and you’ve been paying $1000 a month on that
  4. The snowball method says to make the minimum payments on everything. So, let’s say you can drop the CC to $750 a month.
  5. What you do then is you take the $250 you’re not paying onto the credit card and add that to the $100 a month for the $1000 furniture debt. Now, it is $350/month against that in total. The furniture debt is cleaned up in about three months.
  6. Then you take that $350 plus the $500 you have for the car loan and pay the car loan down at $850 a month. It would take about 9-10 months to clean that up because you’ve already been paying the minimum payments while repaying the furniture debt.
  7. Once you’re done paying off the car loan, you take the $850/mo from that, add the $750/mo you were doing onto the CC and pay $1600/mo against the credit card debt. Previously, you had been paying $1000/mo on the CC. At this point, you are paying $600 more but you have already eliminated 11k in debt and in about 3 years you’d have all of your debt eliminated.
  8. That’s how you snowball. You’re achieving wins along the way and you’re creating this larger snowball for attacking the larger debts.
  9. The key here is that once you have the furniture paid off you don’t put that $100/month into your family budget for spending money. You keep leveraging the payments power by snowballing them.
  10. You want to achieve cumulative payments. You want to start with the smallest debts so you are giving your self rewards by feeling the success of getting stuff paid off.

If you’re facing debt, remember the first step is to get on board with each other. If you don’t want to do what your spouse wants, or your spouse isn’t on the same page, be gentle with each other. Find out what is really going on for you and why you’re stuck.

Then work on moving towards a place where you can honor the dream of being debt-free. Even if it’s not super important for you – you can give that as a gift to your spouse.

If you get stuck, Get In Touch!

Finance Series

This is Part 5 of 5. Make sure you view the rest of the series:

[i] Linda Skogrand et al., “Financial Management Practices of Couples with Great Marriages,” Journal of Family and Economic Issues 32, no. 1 (March 2011): 27–35, doi:

[ii] Stevie Watson, “Credit Card Misuse, Money Attitudes, and Compulsive Buying Behaviors: A Comparison of Internal and External Locus of Control (loc) Consumers,” College Student Journal 43, no. 2 (June 2009): 268–75.