Maybe this will be my crusade. I’m passionate about debt management for one reason: I, along with many others, believe that much like a cancer in the body, consumer and corporate debt has the potential to bring the nation to its economic knees. I believe that if we don’t get it under control, debt may send many of us back to the food lines creating pictures reminiscent of the Great Depression. Do I sound like an alarmist? I hope so.
Close your eyes and allow yourself to think through the people in your world. All of them including the ones you don’t particularly like. Think about how they live relative to the job they have. Think about close friends and family that you know for a fact are living beyond their means. Watch financial self help shows like Suze Orman who talk to people who have more credit card debt than their house is worth. I will admit that some of these judgments of other people are not fair but statistics show them to be true. Here are the top five debt statistics that may shock you:
Today’s consumer has an average of 13 debt obligations on their credit report
The total amount of debt owed by Americans is more than 2.5 trillion. $8,500 per person on average.
38% of the 2.5 trillion comes from credit card debt
The average amount of credit card debt per card holder is $12,500 according to the Federal Reserve
74.9% of families had credit cards and 58% of those carry a balance.
Finally, talk to the forward thinking economists and some will tell you that they believe that although we are in a housing credit crisis right now, the next crisis, and it may be even bigger, may be the credit card crisis. The same thing happened where we have given credit cards to anybody and everybody who wants one and many of these don’t have the ability to pay it back.