Many people have had that moment where they think they will never get out of debt, and if you think that you’ll die in debt, you are not alone. In fact, 21 percent of Americans believe that they will never be able to pay off their debt. This number is slightly up from last year’s 18 percent even though the job market is improving. What has people feeling this way?
It seems although the job market is improving, people are still worried about job security, said Matt Schulz, senior analyst at CreditCards.com. “This shows there is a real debt problem in America and it’s not improving very much.”
The survey also found that the number of people in America who are debt free is sitting at 22 percent this year. This is up from 14 percent in 2014. Those who make up to $30,000 a year are the ones that are more likely to say that they are debt free. People making at least $75,000 a year are the least likely to say that they are debt free, according to the survey.
However, people making at least $75,000 a year are the ones more likely to say that they can pay off their debts easily. People making less than that amount each year (a large portion of the U.S.) feel trapped by their debt and feel they are unable to pay it off. It was also proven that people with no children are more likely to say that they will never be able to pay off their debt than people who are parents.
Of those who are not debt free, 48 percent say that they will remain in debt until they reach their 60s. “Even [for] people who don’t see themselves getting out of debt, it’s important not to be paralyzed by hopelessness,” Schulz said.
Of course, you can take certain steps to pay debt down so that you aren’t in debt until the day you die. You can make a budget that includes higher repayment of debt. For example, if your minimum payment on a credit card is $35, pay $50. You can also ask for the credit card company to check into lowering your interest rate. If they cannot, you can attempt to transfer the amount to a zero-percent interest card.
The survey showed that millennials have one of the highest levels of debt, however, they seem the most optimistic about being able to pay it down. “It kind of speaks to the optimism of youth,” Schulz said. Only 11 percent of the generation replied to the survey saying that they don’t think they will ever live debt free, leaving 89 percent saying that yes, eventually, they will be completely debt free.
Schulz believes that as the economy continues to improve, more people will have a positive outlook on their debt situation. Oftentimes, perceptions of your personal financial situation often mirror the current economic situation of the entire country. Because we’ve been in such a slump for so many consecutive years, it may take a little while to get out of this mindset.