Is It Normal to Have Debt?

February 27, 2018

Do you look at your various bills at month’s end and calculate your overall debt? Do you sometimes feel overwhelmed by that number? You’re not alone.

We know it can be stressful to see your debt balance grow. Maybe you wonder how long it will take to chip away at your debt or question if you have done something wrong along the way. But rest assured, nearly everyone you know has grappled with debt. Your neighbors have, your co-workers have, even the most admired CEOs, celebrities, and global investors have dealt with debt. Don’t make the mistake of equating professional success with a debt-free lifestyle—for many, much of those paychecks end up going to six figure student debt.

Bottom line: People from all walks of life have debt.

For many of us, some debt is fine—even healthy—when it helps us reach a financial goal like owning a home or earning a degree. But the first step in getting a better understanding of your own debt is to take a look at what the debt situation is for an average American household.

How normal is it?

More than three-quarters of American families (77.1 percent) have some amount of revolving debt, according to a September 2017 report from the Federal Reserve. These debts can range from student loans and credit card debts to mortgages and personal loans.

Average Household Debt in the US

How do you measure up?

Now that you know the debt situation for the average American, the next time you are adding up your credit card balances, keep your financial status in perspective.

“But what if I owe more than the average American in credit card debt,” you may ask?

Fret not, this is when you can start looking at your debt holistically—from auto loans to mortgages and everything between.

What’s most important? Your plan.

What’s most important is that you know your own debt mix, and you have a pay down plan. If your debt has high interest or if you have a tough time keeping track of all your monthly bills, you can consolidate it into a fixed, low rate personal loan. In fact, customers coming to LendingClub for a personal loan for that reason save almost $300 per month on average.2

In a perfect world, we would love to pay off our credit card balance in full every month, but that can’t always happen, and that is okay. In fact, it’s normal: Close to 61 percent of Americans who have ever owned a credit card said they have carried a balance from one month to the next, either currently or previously. If you carry a balance more often than not, you’re not bad. But you’re likely overpaying on interest.

What you can do now

Wondering what steps you can take to ease your debt?

1. Ask for an APR reduction

It never hurts to ask, and your credit card company wants to keep you as a customer. You can even set a reminder on your phone to call every 12-18 months to request a reduction in APR. Tip: if you’re having trouble finding your current credit card APR, check the last two pages of your statement. Sometimes they’re buried!

2. Consider a personal loan to consolidate your debts

If your debt isn’t working for you, or is still causing you too much stress, you may want to reduce the amount of money you are putting toward interest. You can alleviate financial stress by reducing the number of bills you have to keep track of each month, and by knowing that your interest rate won’t fluctuate. You can also looking into creative ways to pay off debt. LendingClub customers consolidating debt see an average credit score increase of 28 points1 in 3 months, and save almost $300 per month.2

3. Take a deep breath and know you’re not alone in having debt

People with debt come from all walks of life, all professions, all backgrounds. If you have debt, you’re normal! And there are solutions to any debt-related issues that arise like using the debt snowball method, in part because it is so common and . The more you know, the easier it becomes to face your debt—and take control of it.

Want to learn more? Check out our Resource Center, where you can find articles about what affects your credit score and interest rates, why people get personal loans, and personal finance basics.


1. Average credit score increase for all borrowers who took out a loan via LendingClub between January 1, 2013 and December 31, 2016 with a stated loan purpose of debt consolidation or pay off credit cards 3 months after issuance.

2. Based on responses from 2,259 borrowers in a survey of 14,049 randomly selected borrowers conducted from 1/1/17-7/31/17, borrowers who received a loan to consolidate existing debt or pay off their credit card balance reported that they saved $287 a month on average.

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