This piece is part of my 2016–2026 archive migration. Some original formatting, content, and external links may be missing, changed, or not be optimized.
Something everyone should be asking themselves
Do you know how many monthly payments you owe?
On top of that, there might be little urgency to decrease this number, which can cause the number of minimum payments you manage to increase year over year.
According to CNBC, the average debt balance by age group:
Gen Z: $9,593
Millennials: $78,396
Gen X: $135,841
How many different accounts people have that add up to these debt amounts is not clear, but what is clear is that people tend to accumulate debt versus paying it down.
Many are managing multiple credit cards, a car note (85% of people hold a car payment), a mortgage, personal loans, and student loans; that’s at least five different accounts.
You could easily manage around ten or so minimum monthly payments if you have multiple cars, student loans, and credit cards.
Why Do People Accumulate Debt?
#1 It’s Easy To
One of the reasons people accumulate debt is because it’s easy to do; society makes the acquisition of debt seamless by offering financing and credit.
Debt is an insidious actor. If you don’t learn how to wield it, it will control you and keep you financially locked down.
It’s so easy that many don’t recognize how much debt they accumulate until they sit down and audit their finances.
You will continue digging in a hole until you face your finances. And you won’t feel a thing. Financial ineptitude doesn’t always show up in the short term; it can take years or decades until you reach a dead end.
#2 It’s How People Fund Their Lives
The average person can’t fund their lifestyle with their current income level, so they leverage debt.
The truth is, most people would experience a different lifestyle if they didn’t have access to financing and credit.
How would your life look now if you didn’t have access to credit cards, financing, and loans? How dependent are you on debt?
#3 People Aren’t Positioned To Take Financial Responsibility
My favorite example of this is COVID-19 stimulus checks. During the pandemic, groves of people were receiving unemployment and stimulus checks.
Why was this the case?
People were struggling because they didn’t have emergency funds, savings, or investments to help them during the economic turmoil.
So, the government stepped in to save them.
People don’t want to take financial responsibility for their lives. Many are hoping someone or something will save us.
And society allows it.
But the more responsibility you take over your finances, the more freedom you will experience.
Key Takeaway: Stay on top of your minimum payments, but also stay on top of your subscriptions. Both of these can insidiously eat up your cash flow. Minimum payments are traps and will keep you in debt for a lifetime.
Medium
This content is for informational purposes only — not professional advice. Consult a qualified professional before making any major decisions.