Maybe you left the house early to take your place in line for a pre-dawn store opening. After all, it is Black Friday, when the deals are simply too good to be true.
If that’s the case, you may already be home, relaxing with a cup of coffee, reading the paper and patting yourself on the back for paying low dollar for so many nifty Christmas gifts.
This is probably a good time to talk about debt — if you can stand to think about the credit card bills that will be arriving.
The good news is the bills usually don’t show up until later. The bad news is taking a look at the balance due is a little like hearing the doorbell ring, opening the door, and someone smacking you with a cold, dead halibut. Sort of takes your breath away.
The Federal Reserve and U.S. Census Bureau have compiled the latest data, and the average American household carries just more than $137,000 in debt. That’s not such good news, given that the median household income is just more than $59,000.
Here’s how it breaks down: The average household credit card debt is nearly $17,000; for the family car loans, it’s just over $29,000; student loans are piling up, and the household average is $50,000-plus; and the big-ticket item is the home mortgage, with an average incumbrance of $182,421.
Those numbers aren’t likely to improve anytime soon. Over the past decade and a half, the cost of living in America has increased 30 percent, but household incomes grew only 28 percent. That imbalance compels families to rely more on borrowing, especially in day-to-day expenses, which so many people pay with plastic.
Another reason for the growing debt mountain is a 57-percent increase in medical expenses, food and housing costs swelling by more than 35 percent — numbers that do not match up favorably with household income.
And people actually wonder why so many Americans seem stressed out? It’s not just the heated political climate. Debt has a way of keeping you awake at night too.
Instead of staring at the ceiling in a darkened bedroom, experts say these are the things you should do to ease the family debt burden:
Focus on the debt with the highest interest charges, and strive to pay that off first. If you can, always pay more than the minimum on that high-interest debt.
Consider consolidating your debts. The Federal Reserve data indicates there are about 240 million active credit cards in the U.S., and there’s a good chance you have more than one piece of plastic money in your wallet.
Get the family together to discuss ways you can reduce spending. Make sure to include the kids in those conversations, and be prepared to be amazed at what they know about spending and the cost of things.
Put your credit cards in a dresser drawer for a few weeks, see if going cold turkey, spending-wise, is as grim an ordeal as it sounds.
This last item is the toughest — if you’re one of those people filing your 2017 income tax returns early, expecting a nice refund, consider putting that “found money” toward paying down your pile of holiday-season debt. The temptation is to splurge on something nice, but believe us, paying off debt is more important.
Perhaps most important of all, work on a strategy of showing some restraint while shopping for Christmas gifts. Money not spent between now and the end of the year is money saved.