Jason Lancaster writes for Wink and Wink, a small family law firm. Wink and Wink is staffed with knowledgeable Denver Chapter 7 lawyers to help Americans in financial trouble.
There was an infographic along with this post. However, it was lost when this site was hacked.
These days, it seems like everywhere we turn, people are lamenting the skyrocketing level of American consumer debt – well over $100,000 per family in some states. What exactly does Joe Average owe? How do you compare to Joe? Unless you’re a CEO earning over $8 million a year or part of the 25% of debt-free households, you probably relate to Joe Average in some way.
Many folks blame credit cards for constant consumer debt, but take a look at this picture: Joe Average will need over 20 years to pay off just $4,300 spread out on 13 credit cards. That’s a long time, but compared to $14,400 on car loans and $24,000 on home equity loans, the credit card debt forms a small percentage of Joe’s overall debt.
What about mortgages? Joe needs 23 years to pay off a mortgage. He’s not worried, but he’s forgetting about the $30,000 home equity loan for remodelling. Unfortunately, life happened and most of that money went to other things. He only ended up investing $4,500 of that money in the house.
Some of that home equity money went toward a down payment on a new car. Even so, his car loan, nearly $28,000, will take over five years to pay off. By that time, the car will have lost half of its value. At least the interest rate beats his credit card rate of 14% but the overall statistics are grim when the portrait of American debt is examined in detail.
Editor’s note: I was surprised that my Colorado had the second highest debt load. If we had gotten the house, we would have been rather higher than that number, but at least on track to pay it all off within 10-15 years.
How do you stack up against the averages?
Related articles
- Can I Write Off Credit Card Interest on My Taxes? (turbotax.intuit.com)
- Become Debt Free with a Grand Per Month (grandpermonth.com)
