Why Debt is Not Normal

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Despite the fact that so many Americans are in debt, it's not normal. It's a dangerous mindset to fall into. Here's why debt is not normal or good to have.

I live with three housemates. Three of us also have significant others, meaning there are seven people in and out of my house regularly.

Of those seven people, five of us have some kind of debt: student loans, credit cards or a mortgage. Sadly, our numbers reflect the average American: the average American household carries $15,611 in credit card debt, $155,192 in mortgage debt, and $32,264 in student loan debt. 

Despite the fact that everyone seems to have some kind of debt, debt is not normal.

Debt is Everywhere

Americans have an unhealthy relationship with debt. Credit is offered to people of all ages, incomes and credit histories. Eighteen year olds fresh out of high school are offered credit cards, personal loan offers get mailed directly to our homes, and car leases make getting a vehicle easy-peasy. We finance a lot of stuff – from cars and homes to TV’s and holiday presents.

We don’t like to be told “no.” It’s part of our culture to figure things out, to defeat the odds. We, as a nation, like to overcome obstacles and emerge victorious!

So when we get told, “You can’t afford that,” we turn to credit to prove that voice wrong. Maybe we can’t afford a $1,000 payment up front, but we can swipe a card and make that $22 monthly payment no problem.

Except that it IS a problem. One that lots of people have. According to USA Today, one third of Americans were delinquent on their debt in 2014.

Being delinquent means a payment is so overdue the bill has been given to a collections agency. The failure to pay is also reported to credit bureaus, negatively affecting millions of people’s credit scores.

Credit Scores Matter

Like it or not, credit scores matter. If you’re someone who runs off of credit cards, your credit score matters even more.

Credit scores are used to determine how much credit you can be given (a $500 limit vs a $5,000 limit), and how much interest you’ll pay on that line of credit.

It doesn’t just apply to credit cards – generally, whenever you apply for any type of loan, your credit score is taken into consideration. If you have a low credit score, it’ll be harder to get decent terms on loans. Being delinquent on any credit payments you have is a fast ticket to a bad credit score.

It Can Take Years to Pay Off

According to the USA Today statistics, the average American household carries $53,850 in debt total. I don’t know about you, but that’s more than I make in a year.

With student loan interest rates up to 8%, and credit card interest rates reaching as high as 25%, paying off that amount of debt will take years. Years!

Instead of living your best life, owning your money and making choices totally independently, we are tying ourselves to creditors for huge chunks of our lives.

Why Debt Sucks

I hate debt. I really do. Living with my student loans hanging over my head these last four years has been really tough.

I’ve never had peace of mind when it comes to money. I know I always have to send money off to my lenders every month, no matter what my income might look like at the time.

Student loans are a particularly bad beast too – it’s extremely difficult to get them discharged by declaring bankruptcy. They’re essentially with us for the rest of our lives, until we pay them off.

Having debt of any kind limits you in the same way I’m limited. I have to postpone savings each month to make debt payments. I have to work no matter what, even if I hate my job or if there are unfair circumstances, because I have to make my payments. I have no flexibility or freedom with my money. All the money I earn doesn’t even stay with me each month!

Just because everyone seems to have some kind of debt doesn’t make it normal. It certainly doesn’t make it good! It makes a generation of people tied down, limited in the worst way. Those news articles you hear about millennials postponing marriage, kids, and buying homes? That’s because of debt. We are literally putting our lives on pause because of debt.

Debt Should Not Be Forever

Sometimes debt seems worth it. I took out loans so I could go to college and receive an education. There is no doubt that that decision has changed my life and made it better in a lot of ways.

People who take out home loans are paying to have a place to call their own, maybe raise a family. Paying for a medical bill with credit is sometimes the only way to get the care you need. These situations come up for everyone.

Debt should not be a permanent state of living, though. If a situation arose where you needed credit, you must make it a priority to pay it all back and get out of debt ASAP.

I’m on track to pay my loans off this summer, three and a half years after graduation. If you’re in debt, focus on making larger monthly payments until you’re debt free. Cut back where you can, set a debt payoff date, and use credit as sparingly as possible. If you have a $5,000 car loan, you probably don’t need to charge that new TV to your credit card.

Getting out of debt is the best thing I’ve ever done for myself, and I promise it will be the same for you too. Don’t fall into the mindset of thinking debt is normal.

Have you ever fallen for thinking debt is normal – that it’s okay to have because everyone else does? How did you overcome it? 


  1. Petrish @ Debt Free Martini

    It is so sad that there are so many people who actually believe that having debt is normal. Its the greatest financial myth of all times, and when we choose to live with debt, we are choosing to live below our privilege. Love the post and love the blog.

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