With over a trillion dollars in student loan debt alone, a majority of the population has debt. Whether it’s a mortgage, auto loan, credit cards, student loan or personal loan, debt is real and it’s out there. If you have debt, especially debt you’ve been carrying long term, then you probably know it’s doing more harm than good.
Haven’t prioritized paying off your debt just yet? I want you to reconsider. I’m sharing 5 scary truths about carrying debt long term – not to make you feel bad about your situation, but to motivate you to start being strategic with paying it off. It doesn’t matter how far away debt freedom seems; it only matters what you do right now to get you closer to it.
#1 Carrying debt long term costs you a lot of money
Have you ever taken the time to read your credit card statement? By law, it’s required to tell you how much interest you’ll pay over the course of the debt by just making the minimum payment. It also has to tell you that you can pay it off in 3 years by putting an extra X amount towards the monthly payment.
Just look at the numbers. Depending on your interest rate, you could be spending thousands and thousands of extra dollars, just in interest. Carrying debt over long periods of time costs you so much more money than you originally borrowed. When you look at your debt from that perspective, it really makes you reconsider accumulating more debt.
#2 The longer you have your debt, the worse you feel
Coming from a girl who had debt for years and got herself into and out of debt multiple times, I can attest to this scary truth. Debt makes you feel bad. The weight of knowing you owe so much money to other people is heavy. Sometimes, it can even feel like there’s no hope. This is a scary truth about debt.
No matter how bad your debt situation looks, there is a light at the end of the tunnel. There is a way to slowly chip away at your balances. However, the longer you put off paying down your debt, the longer you’re going to feel weighed down by it.
#3 Debt can make it harder to reach your life goals
There’s nothing worse than wanting to do something like buy a home or new car, but you can’t because of your current debt situation. Lenders most certainly look at the debt you currently have before they offer you more credit. If you need credit to help you reach your goals, your long-term debt can postpone you from getting started.
#4 Carrying debt long term may make it hard to take on more debt
Like I mentioned above, the more debt you have, the less likely you’ll be approved for more credit. At some point, lenders are going to assume you’re taking on more than you can chew. This will absolutely result in a credit request denial.
While taking on more credit may not be in the cards for you right now, that doesn’t mean you won’t want it in the future. Your debt can come back to haunt you if you let it go long periods of time without paying it off.
#5 If you keep putting it off, it will keep accumulating
Lastly, and probably most importantly, the longer you keep your debt, the more expensive it will become. Forbearances and no payments required may sound nice, but the interest is still accruing during that time. Once the forbearance ends and payments are required, you now have a bigger balance to pay back.
I share all these truths with you not to make you feel bad about your situation, but to remind you to prioritize paying off your debt. It’s just going to make you feel bad and cost you more money if you avoid it. Let the reality of the situation hit and then get to work on paying your debt down. You got this!
Related: What No One Tells You About the Debt Free Journey
The long and short of it? Debt isn’t doing you any favors. Carrying debt long term keeps you chained to paying someone else back, for more than you originally borrowed. Most of us need to debt to get a home or a car, but we don’t need to carry that debt for the rest of our lives! We can (and should) prioritize paying it off. Do you have debt that you’ve been carrying for a while? What game plan do you have in place to pay it off? Share your debt journey in the comments section below.
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