The considerable and sustained boom in personal debt recently has in many countries around the world led to experiences of over-indebtedness that are associated with very considerable distress and suffering. This article explores critical perspectives that situate personal debt, material deprivation and suffering, and specific ways of knowing and acting, within the context of recent political and economic practices. There is a need to focus on positioning people's experiences of debt within a broader matrix of factors of national and international practices and policies, including globalisation, changing labour markets, and poorly regulated financial industries. These factors appear to have allowed a network of international financial institutions to adopt practices that have proved successful in creating personal debt. Yet, an individualised discourse of financial capability has been propagated, configuring personal debt as a problem of irresponsible individual consumption. In order to explore ways of resisting reactionary and individualised modes of addressing personal debt, proposals will be made of alternative paradigms for responding to personal debt, defined by two dimensions of community psychological practice, with examples. This article aims to increase collective awareness of the systemic character of debt and the collective responses required. Copyright (c) 2014 John Wiley & Sons, Ltd.