No one enjoys being in debt, but it is a fact of life for most American adults. The average debt portfolio looks like this:
• 80.9% of Baby Boomers are currently in debt
• 79.9% of Generation X’ers are currently in debt
• 81.5% of Millennials are currently in debt
The news isn’t all bad, however!
• 14% of Baby Boomers have overcome debt, 5.1% have never been in debt
• 11.9% of Generation X’ers have overcome debt, 8.2% have never been in debt
• 7.6% of Millennials have overcome debt, 11.0% have never been in debt
Although the percentage of Millennials currently in debt is slightly larger than any of the other age groups, it’s also true that more of them have managed to stay out of debt altogether when compared to any other generation, with Gen X’ers running a close second to Baby Boomers when it comes to overcoming debt. While much of the debt carried by most American households is due to mortgage debt and/or student loans left over from our college days, which is totally understandable given the steep rise in the cost of higher education, the weight of carrying debt it is still quite burdensome.
Overall, credit card debt is the most common form of financial obligation facing our nation today, albeit the one with the lowest average amount. With so much of our population struggling with some form of debt, it’s no wonder money issues still rank as the number one point of contention among couples. And while paying the bills can indeed be the main source of stress and disagreements between us, our debt does not define who we are as individuals.
Thinking about debt constantly will not lead to happiness. Obsessing about money, whether how to make more or how to pay off debt, is counterproductive, doesn’t solve the problem, and only ends up making us frustrated and miserable. If you are in debt but have a plan to eliminate it and are actively taking steps to be debt free at some point, you are in the process of overcoming your debt. Why not stop thinking of yourself as a debtor, and begin defining yourself as an overcomer?
It may take years to get your debt balance down to zero, but there are some really good things that can happen during that time as you faithfully work your plan for achieving financial freedom. Let’s look at some of the positives that can occur as a result of being in debt:
• Develops discipline
• Inspires creativity
• Cultivates patience
• Teaches the value of money
• Curbs excessive spending
• Highlights good choices
• Puts the focus on the future
• Teaches accountability
• Fosters transparency
• Promotes flexibility
• Increases appreciation for good relationships
• Cultivates thankfulness
Sometimes achieving happiness is as simple as shifting our mental focus from the negatives of a situation to the positives. Yes, you may have thousands of dollars in student loan debt, but you made an investment in your education and therefore, your future. That’s a good thing! Your mortgage payment may be a monthly reminder of your debt, but if it results in a secure roof over your head and provides a place where your family is safe and your friends love to gather, that’s a gain, not a loss. With over 500,000 homeless people in the U.S., your home represents something many people can only dream of.
The undisputable financial fact of life in America is that most of us owe someone money, sometimes a lot of money, but there’s so much more to life than debt! Debt can be conquered with time, patience, a workable debt repayment plan, and diligence, and as we pointed out above, there are at least a dozen benefits that can be derived from the process of paying down your debt.
Don’t focus on the fact that you’re in debt or be daunted by the amount of money you owe. You are not defined by your debt! Choose from the list of the positives that can occur in your life as you work to pay down your debt and focus on making it a personal strength. Reward yourself when you pay off a debt and roll that monthly payment to another debt, enabling you to pay the next bill off faster.
Celebrate your good choices, teach others all the creative ways you discover to enjoy life that are low cost or free. Pay off your “bad debt” (think high interest credit cards) first, work on your “good debt” (student loans and mortgages) next. Share what you learn along the way to a debt free life with someone else and inspire them with your newfound knowledge and financial victories. Be patient with yourself. Focus on the important things in life such as family and friends. Your debt will be gone eventually, and in the meantime, you can still enjoy life abundantly . . . even with a stack of bills to pay.