Tennessee Ernie Ford crooned about it in the 1950's song Sixteen Tons.
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Kanye West tweeted that he racked up $53 million of it.
Whether you âowe your soul to the company storeâ or youâre in the hole after following your dream of launching a fashion line - Americans are swimming in debt.
A CardHub study says the average household with credit card debt now owes more than $7800 - the highest amount since the Great Recession.
âAs far as the credit markets are concerned, 2016 might be shaping up to be the next 2008,â says Jill Gonzalez, an analyst at CardHubâs sister website WalletHub. âConsumer confidence is good for the economy, but bad when it comes to consumers overspending far beyond their means.â
Gonzalez says the âsnowball methodâ is one way to become debt free at the lowest cost possible. âAttribute the majority of your monthly payment to your balance with the highest interest rate. That's where youâre losing the most money. Put all of your cash there and make the minimum payment on everything else. When your most expensive debt is paid off, repeat the process with your remaining balances.â
Victor Antonio, host of the Spike TV show âLife or Debt," advises consumers to use cash instead of credit cards and avoid being tempted to buy items just because theyâre on sale.
Antonio recommends an âeconomic shutdownâ for anyone tackling debt.
âThatâs when a family only spends on things they need, and not on things they want such as entertainment, eating out and vacations. An average family making $50,000 a year can save $1,500 a month.â
Credit card debt isnât the only substantial debt weâre carrying.
The Federal Reserve Bank of New York says mortgage balances remain the largest component of household debt at more than $8 trillion.
John Sweeney, Executive Vice President of Retirement and Investing Strategies at Fidelity, says consumers should view mortgages and credit cards differently.
âYouâre paying for the home with a 30-year mortgage, but youâre going to live in it for 30 years. Usage of the home in the time youâre paying for it is aligned. Bad debt is when you put dinner on your credit card and you end up paying 18% over the next two years for that dinner you consumed in one night.â
The Federal Reserve says the second largest portion of household debt is student loans - at $1.2 trillion.
Greg McBride, Chief Financial Analyst at Bankrate.com says consumers have some options with the average student loan debt at $30,000.
âStudent loan debt can typically be repaid over a period of 20 years or more, at a favorable interest rate, with forbearance options in the event of financial difficulty.â
McBride says families should work together to avoid as much student loan debt as possible.
âParents can help by saving money during the 18-year lead time before college expenses kick in. Students can help by going to a less expensive school and majoring in something that actually translates to the job market.â
This is the first in a series of articles that will appear weekly during April; National Financial Literacy month.