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Remember 2008 when the markets crashed? That was actually caused by a huge portion of people living on credit and living past their means. Unfortunately, in 2017 there is evidence it’s happening again. People are racking up debts on credit cards, going on holidays that they haven’t paid for and buying home furniture they can’t afford. It’s a dangerous situation, but it’s really the tip of the iceberg when looking at the causes of debt. Like any iceberg, the true danger remains hidden, underneath the surface.
You might think that medical bills could never drive you into debt. On the contrary unpaid medical bills are one of the main causes of personal debt in the USA. It’s not the little things like a scraped knee that causes debt. It’s when you get in a car accident and need skin grafting for your face. Or, how about paying for cancer treatment. If you’ve never dealt with cancer in the family, you might think the treatment is free or at least affordable. It isn’t, on average cancer treatment can cost close to hundreds of thousands of dollars. You might survive but if you do you’ll be paying off the treatment for the rest of your life. Of course, you can get health insurance, but a lot of people either choose not to or simply can’t afford it. One of the reasons why people haven’t applied for Obama care is because it’s complicated. So rather than tackling the issue, they avoid it completely. However, getting a good insurance plan could certainly help you avoid the danger of debt.
You may have recently dealt with a death in the family. One of the worst things about a tragedy like this is handling what they left behind. Money is passed down as are any personal effects, but what if the opposite happened. What if after your loved one died, you discovered that all they had to pass on was unpaid debt. As the grieving spouse, you would be responsible for any debt that they had accumulated over the years. It would become your burden. You might think that could never happen, but you’d be surprised. It’s a whole different kind of tragedy that many people have to deal with. Their only hope then is personal loans for debt consolidation. Particularly if the individual had debt from multiple sources.
Thinking about buying property this year? It’s another cause of debt in the USA because most people who buy property can’t afford it outright. Instead, they have to take out a mortgage, and that is essentially built into the process of purchasing a home these days. The problem is that this is essentially a debt and it can start to weigh you down. Particularly when the rules and stipulations behind the mortgage change. The interest rate can become unmanageable, and you’re then tied into a property you can’t afford. As such, you do need to double check you can afford the overall costs before you commit to a purchase like this.
You see, debt may strike you when you least expect it. So never say never, always prepare.