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Four signs you have too much debt

Pandu W. Soeprapto
Pandu W. Soeprapto

Banker, part-time teacher, and at-any-other-time writer

Jakarta  /  Wed, January 11, 2017  /  05:38 pm
Four signs you have too much debt

Tremendous effort, courage and proper financial knowledge are needed to battle with one’s debt. (Shutterstock/File)

Tremendous effort, courage and proper financial knowledge are needed to battle with one’s debt. 

The following are signs that one may have accrued too much debt: 

You do not know the number

How much debt do I owe? It is tempting to just ignore and forget about it since the answer might be scary. However, that attitude will not make the debt go away.

Face reality! Start managing your debt, list out your finances, note debt amounts, interest rates and due dates.

Good bye pay check

Think for a moment, how much of your pay check that is being taken by debt? 50 percent? 60 percent? Or even more? 

Rule of thumb: debt payments should not exceed 30 percent of your paycheck. Even if you have to give up to 30 percent of your paycheck to debt payments, begin doing so today, slowly but surely, you will be glad that you did.

(Read also: Saving is (not) hard)

Can only afford minimum payment

If your financial situation makes it so that you can only afford the minimum payment amount, and you are unable to make additional payments to cut the debt, then debt is overwhelming you. After all your debt is cleared, revise your financial habits.

Savings account

Your savings should increase overtime. By having too much debt, your income will be shifted away from savings. As a result, your savings might be used to pay for debt and interest, which is an extremely dangerous situation.

As a final message, manage your debt so that it will not take control of you! 



Pandu W Soeprapto earned his bachelor in Institut Teknologi Bandung and master from Monash University. Currently works as an Assistant Vice President in corporate banking and has handled many financing projects in various sectors. He has passion in teaching and love to write about people and finance

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