Debt Excessive: How to know when you have too much debt

Posted By: Matt in Saving on 08/25/2016 at 12:40:53

Have you ever thought about debt and wondered just how much you owe·

Do you have any idea what your debt even looks like, beyond paying that minimum monthly payment every month and not so much concerning yourself with the grand total·

If you answered yes to any of these questions, chances are you're doing adequately with your debt in that you're paying what you need to but not addressing the proverbial elephant in the room.

Your massive amount of debt.

If you don't know how much debt you have, there's a good chance you're swimming in it. Those who are financially responsible with their debt can tell you exactly what they owe down to the last cent, even if that number is so staggering that it is embarrassing.

There are other tell tale signs that you're in a ton of debt, some more subtle than others, while you get those moments when your debt is so bad and the red flags are overt and bright as can be, that you simply can't look away for a second.

For starters, if you're getting phone calls from your bill collectors that you owe money, you're probably carrying quite a bit of debt. You also want to check your debt to income ratio to see if it's in the ballpark of the 70 and 30 range (the latter number being the percentage of debt you have in relationship to your income). In addition, you're carrying too much debt if your balances owed are put up against the total amount on the card. A $4,900 balance on a $5,000 credit card is bad news, especially if more than one card is like that.

Debt also becomes an issue when worrying about it starts to change how you act in life beyond the checkbook and savings account. If you are having trouble focusing or you worry about debt so much to the point that you can't work or you're productivity is taking a turn for the worse, you can't ignore those signs, either. We often don't think about the stress of debt and if it keeps us up at night and thus changes or attitude, mostly for the worst.

Finally, if you find yourself using credit card or taking out more loans to pay other debts or loans, you're not really getting to the root cause of your issues, and that is ultimately eliminating your debt or simply budgeting better in that regard.

If you aren't really at liberty to take your debt head on, or you're so concerned with it that you ignore it, that's a sign you have too much debt and a major money overhaul needs to happen.


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