American consumers are drowning in debt, and soon they will just die in debt, says a new survey.
According to a new CreditCards.com study, the number of Americans with zero debt is going up (22 percent) and the number if indebted Americans is also going up.
The survey found that 21 percent of indebted Americans believe they will never pay it off. This is up from 18 percent last year, and nine percent in 2013.
For those who do believe they’ll be debt free say it’ll happen at the age of 54. Among those indebted Americans, nearly half (48 percent) purport they’ll be in debt until the age of 61 or later.
Millennials are very optimistic about getting out of debt. Just 11 percent of millennials think they’ll never be debt-free.
But who are the ones who are hopeless about their debt? White Republicans with no children. Twenty-five percent of Republicans, 24 percent of Caucasians and 23 percent of people with no children expect to die in the red.
“It’s a troubling divide. While it’s great to see more people freeing themselves from debt, the fact that more and more people still feel trapped and hopeless means that Americans still have a major problem with debt,” said Matt Schulz, CreditCards.com’s senior industry analyst.
He added: “Hopelessness can be paralyzing, but the reality is that people have more power of their debt than they realize. The most important thing is simply to take action – even small ones – to start knocking that debt down.”
I will be debt free in 18 months. I found a debt calculator on line and crunched the numbers. I was surprised how much a small increase in the monthly payments can save lots of interest.
I found that accounts with $1,000 to $1,500 balances benefit the most with added payments. Also, $100 payments per month seems to be the sweet spot in interest savings. Increases above $100 does not seem to give you as much interest savings. But you will pay the loan off faster. I only have 1 account that i pay the minimum $25 on, it is a kohl’s charge with a $200 balance, $19 in interest until payoff.
But going from $25 minimum or $50 to a $100 payment really trimmed the debt fast. By adjusting my payments, I will trim $900 off interest charges over 18 months. And have the debt payed off 10 months early.
On one account with a $1501 balance, if I make a one time $500 payment the interest charged until payoff drops from $301 to $91. I will be paying it off in 10 months instead of 19 months. Then that $100 per month payment will go to payoff other debt faster.
In just 2 hours on the computer with payment adjustments on 12 accounts and an increase of just $200 per month towards debt payoff, I save big and get the debt monkey off my back.