There are times in life where debt is perfectly fine to have. There are times in life where debt is not a good idea. One of those is credit card debt. It’s not bad to have a small balance on your credit card, but having a card with a balance of more than a couple thousand dollars is just not good. Here’s how you can determine if you have too much debt to your name.
If you are making just the monthly minimum payments on your credit cards, you have too much debt. The same can be said if you cannot pay off all of your credit card debt within one year. If you use one credit card to pay down the debt on another, you have too much debt. If you use credit cards to pay for gas, food and other necessities, you have too much debt.
Do you have a student loan? If so, one way to tell if you’ve borrowed too much is to figure out if you will make less income in your first year on the job than what you owe on the student loan.
If you have already purchased a home and have a mortgage, you might have too much debt. Take a look at your annual income and compare it to the mortgage. If your mortgage is 2.5 times more than your annual income, you have accrued too much debt.
When you go to purchase a car and you cannot afford to place a 20 percent down payment on the deal, you have too much debt. The same can be said if you need a loan longer than 60 months.
Dealing with debt is a serious issue in Long Island. It’s not something you should tackle by yourself. Enlist the help of an experienced bankruptcy law attorney in New York to guide you through bankruptcy.
Source: InCharge Debt Solutions, “How Much Debt is Too Much?,” accessed Oct. 27, 2017