Americans In Debt: A Closer Look

Debt of Americans

The number of Americans in debt seems to be lurching upward.  Debt can be a scary thing, but it’s also become something to be expected of Americans in recent Americans in debtyears regardless of age or income. This is not only because we need debt to build credit, but also because debt can easily get out of hand and become something completely unmanageable. In fact, a survey showed 8 in 10 Americans are currently in debt.

The main issues relating to debt in this country are housing and student loan debt, but credit cards and other loans also play a major role in what has led to some statistics showing some scary numbers

Debt Through The Years 

A recent report from the Pew Charitable Trusts, which examined debt throughout generations, showed that it’s not just young people getting through school who are in major debt — people are beginning to carry their debt into retirement.

While 69 percent of those polled in a recent survey said they felt non-mortgage debt was a necessity, the subjects also said that the debt was a burden and they didn’t want it.

“Americans have a love-hate relationship with debt. They know they need debt, but they don’t actually want it,” Diana Elliott,  research manager with Pew, said. Other studies have shown that a majority of Americans owe more than they own — a problem that only worsened with the recession and its’ aftermath.

“The share of families in debt … remained almost unchanged between 1989 and 2007 and then increased 50% between 2007 and 2013,” a recent report from the Congressional Budget Office concluded.

How Much Debt We Have 

Another recent study showed that the average household has more than $90,000 — including households that were living debt free. The average American household with debt owes an astonishing $130,000.

Student loan debt is a major cause of the increasing debt in the United States, with the median debt being $20,000 and an astonishing two-thirds of students graduating with some level of debt.

Generation Xers are now trying to figure out how to decrease or eliminate student loan debt. The most alarming part about this particular kind debt, though, is that many students are carrying it through to retirement because of how difficult it is to pay off.

“Many Gen Xers are carrying student loan debt later into life when many have college-bound teenagers. These same Gen Xers, 9 out of 10, believe their children will receive a scholarship, grant, or both, but the reality of that happening is quite lower,” Elliott said. 

Is There A Way Out Of This Debt? 

This is a fairly complex question overall, but there are ways to escape the burden of personal debt and contribute to changing the trends overall. If everyone began paying off their bad debt (high-interest credit card debt, etc), the numbers could turn around quite simply and relatively quickly. It isn’t always that easy, however, but there are ways to reduce your debt and avoid becoming another nationwide statistic.

You can always apply for a balance transfer card if you’ve got good credit, particularly one with 0% APR. Debt consolidation loans are also an option, though many times the interest rates are somewhat high. Another very simple solution is to just call your credit card company and request that they lower the interest rate due to financial woes or difficulty paying down your debt.

So again we revisit Americans in debt – though statistics paint the picture of an America that is swimming in household debt from credit cards, loans, housing and other expenses, finding smart and efficient ways to pay down your debt gives you the opportunity to participate in turning those numbers around. Tackle your debt in a responsible manner and you can eventually pay it off — and avoid becoming just another scary national statistic.

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