Debt in America came to the forefront in a dramatic way during the economic downturn of 2009. It was at that point that the entire financial system seemed on the brink of total collapse and consumers began to see the effects of years of reckless spending and lack of financial regulation by government agencies.
Cards Rule
Cards of all types appear to be the preferred method of payment in America and are among the most prominent reasons for consumer debt in this country. According to the Progressive Relief website, there are more than 1.3 billion different payment card types in circulation in the U.S., including debit, department store and credit cards. In fact, the site states that the average American household has 13 payment cards.
Older Debt
In America, the latter part of middle age is the time in which you have the most debt. According to Credit Sesame, the 50 to 59 age group has the most accumulated debt at $20,157, as of 2010. The group with the lowest amount of debt is the 70-plus age group, with just $6,000 in debt, on average. By comparison, 30- to 39-year-olds have just over $15,000 in debt on average.
Overspending
One of the main issues with consumer debt is America is that people spend more than they make, which puts them living outside of their means. This contributes to overwhelming debt and serious financial problems. The Progressive Relief website states that 40 percent of Americans spend more money than they earn as of 2010.
Home Debt
U.S. homeowners stay in their homes for up to seven years, according to the National Association of Realtors. With a rate of about 8 percent on their mortgages, most will still owe more than 90 percent on their mortgage at the time of sale. With this trend, homeowners may never actually pay off their mortgages during their lifetime. In fact just 2 percent of homes purchased are actually paid off.
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