In some form or another, everyone will experience debt. Debt is common, yet, it’s so terrifying. We know to try to avoid debt at all costs. It’s also pushed that debt needs to be paid off ASAP. Whether you have student loans, credit cards, mortgages, car loans, or anything else, it just seems as if the debt was perfectly justifiable. 

While debt can be common, it can be something that’s hard to deal with. It can get in the way of your life. Especially if your debt to income ratio is above 25%. So how exactly can debt hurt you? While it’s true debt can be awfully stressful, there are other ways that debt can impact you and your family, here’s how.

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Lower quality of life

If you’re looking to change your life, then getting out of debt may be one of the first things you should try. Since debt can be so stressful, it’s going to affect your health. This can include a lack of concentration, lack of sleeping, and it can lead to mental health issues. If you have a family, this can spill onto them. This can include things such as your children stressing over finances or wondering why their quality of life is different from their peers. Overall this can affect you and your family’s quality of life.

Preventing you from purchasing a house

Depending on how much debt you have, it could get in the way of whether or not you qualify for a mortgage. It can also get in the way of how big of a mortgage you qualify for too.  Since all of this tends to be based around your credit score, a low credit score does reflect how “reliable” you’re seen for paying back what you owe.

\Plus, this can mean that you’ll potentially have higher interest rates since you’d be considered a risk. Since the interest rates will be high, you could then be subjected to having to deal with a collection agency. The stress and potential alone just make it seem as if it is not worth it to someone.  While all of this is very stressful and sad, just know that your credit score does not and will not reflect your worth.

Debt makes it difficult to cover regular expenses

This can include daily expenses such as food or gas for your vehicle, but it also extends to monthly expenses such as bills, emergency funds, or even other funds such as vacation savings. Debt tends to come with high-interest rates, which is something that everyone wants to avoid at all costs. These high bills and interest may make it more difficult to pay regularly for other things that you and your family need. Which then leads to having to make tough decisions on what to sacrifice.

Debt can prevent opportunities

This can include opportunities to get a better job, to quit your current job, go back to school, get a business, or even try to help your child or family member with potential opportunities for them. Debt just essentially removes all of that potential. While it’s very unfortunate, debt can get in the way which is why you’ll have to look into ways to remove debt as soon as possible.