It seems like an impossible task to live without consumer debt in America. So much of American society is built around using debt to build the kind of life that people want to live. That's not necessarily a bad thing unless that debt leads to financial problems that ultimately detract from one's quality of life. Consumer Debt Facts The Federal Reserve recently released a debt study for the period ended August 2015. Among some of the startling stats in the report was the fact there is approximately 2,000,000,000 active credit cards owned by approximately 200,000,000 different American citizens. Furthermore, these card holders have shown they aren't afraid to use those cards, which has resulted in total credit card debt in America of $890.9 …show more content…
Focus on Retirement - All of the financial decisions you make today will affect how you live life after retirement. The best way to plan for your retirement is to use 75% of your disposable incoming on living today and save the other 25% for the future. It's important to adopt this approach because you don't want to hit your sixties and have to scale back your life when your resources are limited. Consumer debt hurts the future every time. 4. Budget, Plan and Track - If you don't know where you're going, you will never get there. A budget is designed to help you control your expenditures so you know what's on your plate and can make key decisions to bring in more income or cut back expenses when necessary. It also gives you the opportunity to plan for major expenditures like a home or car. That said, a budget and planning are useless you track your expenditures against your budget. If things go awry, you'll never know why and won't make proper and timely adjustments. 5. Emergency Savings - Of the approximate 2,000,000 Americans who filed bankruptcy in the two-year period ending May 2015, about 60% listed surprise medical expenses as the reason for their downfall. By the time they started using credit cards to pay the costs, they were in over their heads. A healthy emergency savings account can help offset emergency expenses related to health issues, car repair and death in the