Interesting Facts About Debt

Debt is a common but often risky source of funds for many Americans. Using debt to pay for homes, cars and education is fairly standard in the United States. However, a buy-now-and-pay-later spending mentality has led to many Americans incurring significant personal loan and credit card debt.

Student Loan Debt

Business Insider writer Michael Snyder says Americans owe a total of $875 billion in student loan debt, which is actually more than Americans owe in credit card debt. Over the past three decades, the cost of attending college has risen by more than 400 percent. Costs include tuition, related fees and living expenses.

Credit Card Profits

A look at how much credit card companies take in annually in credit card fees and financing charges shows why so many credit card providers exist, and why it is so hard for Americans to get out of debt. In its "12 Amazing Facts about Credit Card Debt," Delray Credit Counseling indicates that in 2006, for instance, the card industry made $55 billion in credit card fees and another $90 billion in finance charges. This demonstrates the hazards of late payments.

Fast Food Loan

When you think about the common uses of loan funds and credit card financing, fast food payments likely do not immediately come to mind. However, Delray Credit Counseling notes that in 2006, Americans charged $51 billion in fast food purchases on their credit and debit cards. According to Delray, that is equal to 10.2 billion Big Mac meals, 3 billion pounds of fries and 1.7 billion gallons of Coke. This fact partly shows American reliance on plastic, but also shows the buy now, pay later mentality in action.

The Young

Not only do college students often incur significant debt to pay tuition and to get an education, they must also deal with being a major target market for credit card companies. Consolidated Credit Counseling Services indicates that in 2008, about one-in-five 18- to 24-year-olds were considered in "financial hardship," largely because of excessive debt. Lenders compete heavily to acquire young consumers for lifetime interest income possibilities. While young people often lack responsibility to manage debt effectively, it is sometimes beneficial to establish a good credit history early through responsible borrowing and paying off your credit bills.