How to Tell If You Have Too Much Debt | McCarthy Law PLC
August 1, 2012

How to Tell If You Have Too Much Debt

When does debt become too much?  For many, it is a difficult question to answer, until the precarious house of cards begins to fall as you realize that you cannot pay all of your bills in a timely manner and begin living paycheck to paycheck.  If you feel like you are teetering on the verge of having too much debt, here is a good article to help you decide if you have too much debt and perhaps need to get professional help.

https://www.foxbusiness.com/personal-finance/2012/07/30/how-to-tell-if-have-too-much-debt/

As this article points out, a good way to gauge if you have too much debt is to look at your debt to income ratio.  In other words, look at the amount of debt relative to your income.  If you earn $30,000 annually, but your expenses are $26,000, then you have a high debt to income ratio.  Comparatively, if you earn $130,000 annually, and your expenses are $26,000, then you have a low debt to income ratio.  The lower the ratio, the better financial position you have.  As this article suggests, if your debt to income ratio is more than 50%, you should seek professional help.

Contact a debt settlement attorney who can help you regain control of your finances, which will then lower your debt to income ratio. Taking yourself out of a precarious financial position will give you peace of mind and be the best thing you have ever done for you and your family.

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