My Bipolar Situation is Making it Impossible to Get Out of Debt


Dear Steve,

I’m not even sure where to start. I guess the diagnosis followed with a rough idea of the dollar amount of debt.

I am bipolar and have somewhere north of $80,000 in debt. There are times where I feel positive about my efforts to eradicate it, but most of the time, I couldn’t even tell you who I owe anymore.

My mental state has worsened over the past few years, even with therapy and medication. I have learned methods to control my access to money during episodes and have greatly reduced the potential for causing more damage.

However, I find that when I try to get things on track the way they should be, I soon end up hurdling into another depressive episode, making it feel impossible even to locate accounts where I owe money.

I have been separated for 3 years and will be filing for divorce in a few weeks.

I considered filing bankruptcy in the past but did not know how it would affect my former spouse, so I never went that route.

I am homeless at the moment, living out of my vehicle, which I only intended to be temporary to allow me to apply more of my VA disability check to my debt, but it is starting to seem as though this may be it for me.

I have also considered debt consolidation loans in the past. Still, most of my debt is secured through a credit union that I’ve been told by consolidation companies they cannot touch.

Meanwhile, I have a child support payment for a previous child that is far higher than anything I could fathom paying anymore, along with the arrears owed, as I can no longer work in the career field that I have spent the majority of my life becoming qualified in due to the bipolar condition and that is what it was based on.

I feel like the only way to make any progress is to hire a variety pack of attorneys to act on my behalf. I’m not even close to understanding where to start or what to do.

What is your expert opinion on my situation? Where do I go to pull all this debt together and make it possible to make any progress?



Dear Chris,

Thank you so much for reaching out to me for help. I appreciate the confidence you have in me to answer your questions.

We can’t let the debt become the sole focus of the overall situation. As you observed, debt is the by-product of underlying mental health struggles.

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I can’t see where a debt consolidation loan is going to improve anything here. I’m also unconvinced that a debt relief situation like credit counseling or debt settlement will result in a debt-free outcome.

Those solutions will not result in the outcome you are seeking because they do or can take many years to complete, if at all.

Let’s say you are three years into repaying your debt or trying to settle it and then fall off the proverbial bipolar wagon.

You are not alone in these struggles. See all these past posts.

The most laser-focused thing you said was, “I find that when I try to get things on track the way they should be, I soon end up hurdling into another depressive episode, making it feel impossible even to locate accounts where I owe money.”

In times of feeling terrific many will overextend themselves, and then when they come crashing back down, everything seems impossible, and it can be ignored.

Your primary obligation moving forward is going to be child support. The consequences of getting out of compliance with child support can have severe consequences.

So let’s talk about bankruptcy. You can find a good local bankruptcy attorney and have a free discussion about what bankruptcy would mean for you. Bankruptcy is the fastest way to get a fresh start for the least amount of money.

The attorney can answer all of your specific questions about how it might impact your ex-wife, but it is not my top concern at the end of the day.

The advantage of bankruptcy is that it will wipe away the debt obligations and give you a second chance and a fresh start. That is both good and bad.

It can get you back to the starting line, but bankruptcy will not prevent the debt from building again as the bipolar pendulum swings.

However, there are some roadblocks you can put in front of you to make it harder to go back into debt.

  • You can freeze all three major credit bureau reports. See this excellent post from the FTC. That will make it harder if you apply for new credit.
  • You can make yourself accountable to someone else. This might be a trusted friend or a Daily Money Manager. A Daily Money Manager can help manage and stay on top of your financial affairs for you.
  • Filing for Chapter 7 bankruptcy may reduce some credit offers in the short term.
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None of those solutions is perfect, and all can be defeated.

You could unfreeze your credit reports in a manic phase. You might stop talking to your Daily Money Manager. Bankruptcy will not prevent you from getting new credit offers.

Do You Have a Question You'd Like Help With? Contact Debt Coach Damon Day. Click here to reach Damon.

So you see, it all comes back around again to the underlying bipolar condition.

If I had to focus time and energy right now on one thing, it would be to continue to explore the right combination of therapy and medication to find an equilibrium.

Not only will that allow you to tackle the debt situation, but it will also help to get you back to being more employable and, fingers crossed, out of living in your vehicle.

Until you can find a firmer foundation for your bipolar disorder making continued payments to creditors may not be the best approach. The exception will be if your vehicle has a car loan against it from the credit union.

So here is my suggested plan of action.

  1. Refocus efforts on finding a bipolar disorder treatment solution that you feel works best for you.
  2. Since your credit union debts might create an unusual situation, I would discuss your specific debts with my friend Damon Day on how to best prioritize the debts.
  3. Talking with Damon will also be able to give you some feedback on when bankruptcy would be best timed.

Please come back and comment on what you decide to do. I would love to stay in the loop about how things go from here.

Damon Day - Pro Debt Coach

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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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