Is 15000 a lot of debt?
The bottom line. $15,000 can be an intimidating total when you see it on credit card statements, but you don't have to be in debt forever. If you're struggling to make your minimum payments every month and you don't see light at the end of the tunnel, sign up for a debt management program to get out of debt fast.
It will take 32 months to pay off $15,000 with payments of $600 per month, assuming the average credit card APR of around 18%. The time it takes to repay a balance depends on how often you make payments, how big your payments are and what the interest rate charged by the lender is.
It's not at all uncommon for households to be swimming in more that twice as much credit card debt. But just because a $15,000 balance isn't rare doesn't mean it's a good thing. Credit card debt is seriously expensive. Most credit cards charge between 15% and 29% interest, so paying down that debt should be a priority.
To pay off $15,000 in credit card debt within 36 months, you will need to pay $543 per month, assuming an APR of 18%. You would incur $4,558 in interest charges during that time, but you could avoid much of this extra cost and pay off your debt faster by using a 0% APR balance transfer credit card.
Debt-to-income ratio is your monthly debt obligations compared to your gross monthly income (before taxes), expressed as a percentage. A good debt-to-income ratio is less than or equal to 36%. Any debt-to-income ratio above 43% is considered to be too much debt.
“That's because the best balance transfer and personal loan terms are reserved for people with strong credit scores. $20,000 is a lot of credit card debt and it sounds like you're having trouble making progress,” says Rossman.
- Make bi-weekly payments. Instead of making monthly payments toward your loan, submit half-payments every two weeks. ...
- Round up your monthly payments. ...
- Make one extra payment each year. ...
- Refinance. ...
- Boost your income and put all extra money toward the loan.
Most lenders say a DTI of 36% is acceptable, but they want to lend you money, so they're willing to cut some slack. Many financial advisors say a DTI higher than 35% means you have too much debt. Others stretch the boundaries up to the 49% mark.
If you cannot afford to pay your minimum debt payments, your debt amount is unreasonable. The 28/36 rule states that no more than 28% of a household's gross income should be spent on housing and no more than 36% on housing plus other debt.
Generation | Average Credit Card Debt |
---|---|
Generation Z | $3,262 |
Millennials | $6,521 |
Generation X | $9,123 |
Baby boomers | $6,642 |
How can my debt be forgiven?
Debt forgiveness can happen in various ways, such as negotiated settlements, repayment plans or government programs. The goal is to help people manage their debts and financial stability.
- Opt for debt relief. ...
- Use the snowball or avalanche method. ...
- Find ways to increase your income. ...
- Cut unnecessary expenses. ...
- Seek credit counseling. ...
- Use financial windfalls.
- Create a Budget and Stick to It.
- Secure an Additional Source of Income.
- Consider Nonprofit Credit Counseling and Financial Assistance.
- Look for Debt Relief.
- Understand How to Use Credit Responsibly.
- The Importance of Debt Reduction.
Around 23% of Americans are debt free, according to the most recent data available from the Federal Reserve. That figure factors in every type of debt, from credit card balances and student loans to mortgages, car loans and more. The exact definition of debt free can vary, though, depending on whom you ask.
Personal debt can be considered to be unmanageable when the level of required repayments cannot be met through normal income streams. This would usually occur over a sustained period of time, causing overall debt levels to increase to a level beyond which somebody is able to pay.
Age Group | Average Debt | Delinquency Rate |
---|---|---|
18-25 | $8,091 | 1.47% |
26-35 | $17,191 | 1.49% |
36-45 | $26,048 | 1.11% |
46-55 | $32,508 | 0.83% |
- Create a Budget. ...
- Debt Management Program. ...
- DIY (Do It Yourself) Payment Plans. ...
- Debt Consolidation Loan. ...
- Consider a Balance Transfer. ...
- Debt Settlement. ...
- Lifestyle Changes to Pay Off Credit Card Debt. ...
- Consider Professional Debt Relief Help.
What's considered too much debt is relative and varies by person based on the financial situation. There's no specific definition of “a lot of debt” — $10,000 might be a high amount of debt to one person, for example, but a very manageable debt for someone else.
Debt is part of the average American's life, and you can start to accumulate it as young as your 20s. New findings from Experian's 2020 State of Credit report show that the average Gen Z consumer (ages 24 and younger) has about $10,942 worth of debt, not including mortgages.
Loan Amount | Loan Term (Years) | Estimated Fixed Monthly Payment* |
---|---|---|
$10,000 | 5 | $207.54 |
$15,000 | 3 | $463.09 |
$15,000 | 5 | $313.13 |
$20,000 | 3 | $617.45 |
How much is a payment on a 15k loan?
The monthly payment on a $15,000 loan ranges from $205 to $1,504, depending on the APR and how long the loan lasts. For example, if you take out a $15,000 loan for one year with an APR of 36%, your monthly payment will be $1,504.
Take on a side hustle
If you have credit card debt, you could start a side hustle and put all of the money toward your debt. Some side hustles to consider include opening an Etsy shop, doing paid surveys, renting out a room in your home and getting a gig economy job, like dog walking or driving for a rideshare service.
According to Experian, average total consumer household debt in 2023 is $104,215. That's up 11% from 2020, when average total consumer debt was $92,727.
The 50-30-20 rule recommends putting 50% of your money toward needs, 30% toward wants, and 20% toward savings. The savings category also includes money you will need to realize your future goals.
Keep track of your on-time payments and monitor your accounts for fraudulent activity. As you can see, it's normal to carry debt, but staying on top of it will protect your credit score and ensure that you have access to the right kinds of products at lower interest rates for years to come.
References
- https://www.bankrate.com/finance/credit-cards/credit-card-debt-survey/
- https://www.cbsnews.com/news/3-ways-to-qualify-for-credit-card-debt-forgiveness/
- https://www.cnbc.com/select/what-is-the-28-36-rule-for-buying-a-home/
- https://wallethub.com/answers/cc/what-percentage-of-america-is-debt-free-2140664784/
- https://www.capitalone.com/learn-grow/money-management/average-credit-card-debt-in-america/
- https://www.nerdwallet.com/article/finance/how-much-debt-is-too-much
- https://www.experian.com/blogs/ask-experian/how-to-pay-off-credit-card-debt-with-no-money/
- https://www.investopedia.com/ask/answers/12/reasonable-amount-of-debt.asp
- https://www.nerdwallet.com/article/finance/what-is-the-average-credit-score-by-age-and-what-is-a-good-score-for-my-age
- https://www.cnbc.com/select/average-american-debt-by-age/
- https://www.fool.com/the-ascent/credit-cards/articles/i-owe-1000-on-my-credit-cards-am-i-in-trouble/
- https://www.koho.ca/learn/zero-balance-on-credit-card/
- https://hopecu.org/understandingcreditcards/
- https://www.nerdwallet.com/article/credit-cards/15000-credit-card-debt
- https://www.thebalancemoney.com/debt-free-characteristics-4059833
- https://www.fool.com/the-ascent/credit-cards/how-long-pay-off/
- https://www.cbsnews.com/news/ways-to-pay-off-10000-in-credit-card-debt/
- https://www.investopedia.com/terms/b/baddebt.asp
- https://www.nasdaq.com/articles/this-is-the-average-age-most-americans-become-mortgage-free
- https://www.creditkarma.com/insights/i/average-debt-by-age
- https://www.genisyscu.org/genisys-blog/why-is-a-mortgage-good-debt-to-have
- https://www.cbsnews.com/news/great-ways-to-pay-off-20000-in-credit-card-debt/
- https://www.caminofinancial.com/en/blog/business-managment/psychology-of-being-debt-free/
- https://www.axios.com/2023/12/12/mortgage-free-homes
- https://www.horizonfcu.org/5-ways-to-pay-off-a-loan-early/
- https://www.cbsnews.com/news/how-long-will-it-take-to-pay-off-your-debt/
- https://wallethub.com/answers/cc/how-to-pay-off-15000-in-credit-card-debt-1000294-2140754717/
- https://www.bankrate.com/finance/credit-cards/business-credit-cards-tax-deductible/
- https://wallethub.com/answers/pl/monthly-payment-on-15000-personal-loan-1000450-2140762724/
- https://www.gloucestershire.police.uk/SysSiteAssets/foi-media/gloucestershire/policies/unmanageable-debt-policy
- https://www.ramseysolutions.com/debt/average-american-debt
- https://www.businessinsider.com/personal-finance/average-credit-score
- https://www.fool.com/the-ascent/credit-cards/how-much-debt-too-much/
- https://wallethub.com/answers/cc/how-long-to-pay-off-20000-credit-card-debt-1000423-2140858500/
- https://www.sacbee.com/finance/article272836150.html
- https://www.marketwatch.com/picks/i-have-20k-in-credit-card-debt-and-pay-400-a-month-just-in-interest-im-worried-about-this-large-sum-of-interest-im-paying-what-should-i-do-01675358619
- https://www.credible.com/personal-loan/credit-card-consolidation-loans/30000-credit-card-debt
- https://extension.umn.edu/credit-and-debt/how-much-debt-too-much-debt
- https://www.usatoday.com/money/blueprint/credit-cards/what-is-the-average-credit-card-debt/
- https://www.bankrate.com/banking/savings/emergency-savings-report/
- https://www.experian.com/blogs/ask-experian/how-much-credit-card-debt-is-too-much/
- https://localfirstbank.com/article/how-much-money-should-i-have-saved-by-the-time-i-am-30/
- https://www.businessinsider.com/personal-finance/average-american-debt
- https://www.forbes.com/advisor/credit-cards/average-credit-card-debt/
- https://abcnews.go.com/US/americans-credit-card-debt-hits-record-113-trillion/story?id=106990807
- https://www.lendingtree.com/personal/personal-loan-calculator/
- https://www.equifax.com/personal/education/credit-cards/articles/-/learn/why-do-people-have-credit-card-debt/
- https://www.unfcu.org/financial-wellness/50-30-20-rule/
- https://www.fool.com/the-ascent/research/average-household-debt/
- https://fortune.com/recommends/credit-cards/average-credit-card-debt/
- https://www.cnbc.com/select/average-debt-for-20-year-olds/
- https://www.incharge.org/debt-relief/debt-management/pay-off-15000-in-credit-card-debt/
- https://www.synchronybank.com/blog/average-american-debt-by-age/
- https://www.consolidatedcredit.org/credit-card-debt/how-much-debt-is-too-much/
- https://www.fool.com/the-ascent/credit-cards/articles/have-10k-in-credit-card-debt-heres-how-to-pay-it-off/
- https://www.investopedia.com/ask/answers/021215/what-good-debt-ratio-and-what-bad-debt-ratio.asp
- https://fortune.com/2024/03/01/millennials-gen-z-snowballing-debt-interest-rates-credit-scores/
- https://www.cnbc.com/2024/03/27/how-much-credit-card-debt-americans-have-by-age-.html
- https://www.bankrate.com/personal-finance/debt/why-debt-forgiveness-is-not-as-forgiving-as-it-looks/
- https://www.cbsnews.com/news/how-much-credit-card-debt-is-too-much/
- https://www.debt.org/faqs/americans-in-debt/demographics/
- https://www.equifax.com/personal/education/credit/report/articles/-/learn/understanding-credit-good-debt-vs-bad-debt/
- https://www.bankrate.com/real-estate/what-is-the-28-36-rule/
- https://gtdebtsolutions.com/2023/06/14/how-much-debt-is-normal-for-your-age/
- https://www.nasdaq.com/articles/40-of-americans-pay-off-their-house-are-they-doing-better-financially
- https://www.cnbc.com/select/paying-off-too-much-debt/
- https://www.cnbc.com/2024/04/09/most-of-americans-are-living-paycheck-to-paycheck-heres-why.html
- https://www.cnbc.com/select/average-american-debt-in-40s/
- https://www.experian.com/blogs/ask-experian/what-is-the-average-credit-score-in-the-u-s/
- https://www.cbsnews.com/news/how-long-will-it-take-to-pay-off-5000-in-credit-card-debt/
- https://www.ramseysolutions.com/debt/7-characteristics-of-debt-free-people
- https://www.cbsnews.com/news/how-to-pay-off-15000-in-credit-card-debt/
- https://wallethub.com/answers/cc/how-long-to-pay-off-7000-credit-card-1000423-2140858495/
- https://www.investopedia.com/average-credit-scores-by-gender-5214525
- https://wallethub.com/answers/cc/how-long-to-pay-off-15000-credit-card-debt-1000423-2140858499/
- https://finance.yahoo.com/news/men-vs-women-more-credit-120024159.html
- https://www.forbes.com/advisor/mortgages/pay-off-mortgage-early-vs-investing/
- https://www.nerdwallet.com/article/finance/find-extra-money-pay-debts
- https://www.incharge.org/debt-relief/debt-management/how-to-pay-off-50000-credit-card-debt-strategies-advice/
- https://www.firstrepublic.com/insights-education/average-american-debt
- https://www.bostonherald.com/2023/03/14/the-average-millennial-has-nearly-30k-in-debt-here-is-what-they-should-do/
- https://www.incharge.org/debt-relief/how-much-debt-is-too-much/
- https://www.cnbc.com/select/how-to-pay-off-credit-card-debt/
- https://money.com/average-american-personal-debt-amount/
- https://www.cbsnews.com/news/how-to-pay-off-20000-in-credit-card-debt-in-3-years-or-less/
- https://www.citizensbank.com/learning/how-much-debt-is-too-much.aspx
- https://finance.yahoo.com/news/jaw-dropping-stats-state-credit-130022967.html