10 Reasons People are in Debt
Friday, September 7, 2012, 2:00 AM | Leave Comment
Today, it seems like more and more people are getting into debt. Whether you are $10,000 in debt or maybe you don’t owe a dime, many people are just curious why others are neck deep in debt.
To help set things straight, here are 10 main reasons people generally fall into that awful debt trap.
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Lost Income
If you have lost a job or maybe your paychecks have been cut in half, many people have found that bills can start to pile up since they were used to the paycheck that they were making before.
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Divorce
Sadly, a divorce can lead to a lot of debt. Since you will have to pay child support, support your ex-spouse and potentially have more bills, this can come to haunt a lot of people.
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Bad Money Management
Spending your money in the wrong places is another reason for a lot of debt. If you’re spending hundreds on clothing, food and entertainment when you can’t afford it, then it may be time to come up with a budget.
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No Job
Like the lost income mentioned above, having no job for a while can rack up the bills fast. Since many people don’t have a penny in their savings account, this can come to haunt a lot of people. While a job may come around sooner or later, many find that once it does, they are thousands in debt.
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Gambling
Sadly, addictions can lead to a lot of debt, especially something like gambling. It’s not too hard to walk into a casino and plop down $1,000 on the table. For those that have gambling problems, it’s always best to get help.
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Medical
One of the main reasons that most Americans today fall into the debt trap is due to health problems. If you don’t have any health insurance, one surgery could easily put you $10,000 or more into debt. If you don’t have health insurance now, it’s best to consider a policy.
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No Savings
As touched upon above, most people don’t have savings today. If you were to lose your job tomorrow, how much money would you have saved up? It’s always so important to save as much money as you can for retirement and a rainy day.
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Credit Cards
Sadly, some people look at credit cards as a piece of plastic. Swiping that card can quickly lead to thousands in debt. For those that don’t know how to manage their credit card can quickly find lots of problems down the road.
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Lawsuits
Yes, lawsuits can happen, and if they do, you could be hundreds of thousands in debt instantly. Whether you had someone slip on your property or screwed up at your job, if you don’t have any sort of liability insurance, you could risk the chance of losing everything.
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Keeping Up
So many people out there want to keep up with their neighbor or the person at work. New cars, homes, furniture and the latest gadgets can soon spiral out of control. Remember, most people don’t care what you have in life.
As you can see, there are many reasons people get into debt. By creating a budget, saving a few dollars and spending your money wisely, there is no reason you should find yourself in the debt hole.
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