Debt: How Can Something That Feels So Normal Be So Bad?

Ask any 10 people if they have debt, and the odds are overwhelming that at least eight will answer “yes.” Debt has just become a fact of life for most all Americans. According to the website Americans with credit cards are now carrying an average balance of $15,675. American household debt now averages $132,158.

More than 40 million Americans have student loan debt. The average monthly student loan payments for borrowers age 20 to 30 is $351! And the delinquency rate on student loans is 11.2% – meaning that more than one in 10 borrowers default on their student loans.

According to a study commissioned by and reported on, only 51% of those with credit card debt worry about it. This same survey revealed that only 25% worried about their credit card debt, and only 28% felt guilty about how much money they were putting on their credit cards.

The disconnect

What these statistics reveal is that there’s a substantial disconnect between the amount of debt Americans are carrying, and their feelings about it. It suggests that Americans may be carrying a considerable amount of debt – especially credit card debt – but they don’t worry about it.

Some do struggle

Df course, some people do struggle with their debts. A recent article in the Durango Herald reported that people earning less than $30,000 a year feel they will never be debt free. It has also been reported that millennials are worried about their student loan debts. And older people who are taking out student loans to help pay for a child or grandchild’s education may also feel they won’t get that debt paid off in their lifetimes.

It may feel normal but it’s bad

These statistics suggest that debt has become an accepted fact of life for most Americans. The problem is that most of them apparently don’t understand that debt is bad.

You’re penalizing your future self

The first bad thing about debt is that you’re penalizing your future self because the money you borrow today will have to be repaid by the future you. This will leave less money available for you to enjoy a good life. While many people don’t think of it this way, debt is like writing an IOU that you’ll have to honor sometime in the future.

Debt costs money

Unless you have a rich uncle who agrees to loan you money interest-free, all the other money you borrow will cost you in the form of interest. Credit cards can be especially costly due to compounding interest. Let’s say you borrow $5000 at 14%. The next month you’ll owe $5014 and will be paying interest on it. It gets even worse if you make just the minimum payments on that debt. Here’s an example of how bad this can be. If you make a minimum monthly payment of $200, it will take you 30 months to pay off the $5000 and cost you $946.20 in interest charges.

Debt can cause physical problems

Believe it or not, the stress of dealing with debt can lead to physical problems. A study done by AP-AOL found that people who say they have high levels of debt stress suffer from a myriad of illnesses related to it. This can include migraines, back pain, ulcers, depression, anxiety, and heart attacks.

Debt can damage your credit score

Like it or not, your financial life is pretty much governed by that little three-digit number called your credit score. It’s comprised of five components. The most important of these at 35% is your credit history or how you’ve handled credit in the past. If you were late in making payments, or worse yet, missed a few payments, you’ll likely have either a fair or poor credit score. This will make it more difficult for you to get new credit, and it will have a higher interest rate. In fact, a poor credit score good keep you from renting a house or apartment.

Debt can hurt your marriage

Debt can cause arguments as to how much debt is too much, who’s responsible for the debt, and who’s creating the debt. These arguments can put a serious amount of stress on a marriage. They can even escalate to the point where the marriage completely breaks down.

In conclusion

Don’t let yourself get lulled into the feeling that debt must be okay because it’s so normal. As you have read, debt can have very serious consequences, up to and including a heart attack. Stop thinking that debt is normal and start thinking what you can do to get rid of it. Your future self will thank you.