8 signs you're headed straight for debt

Avoiding Credit Card Debt

The average US household with debt carries $15,762 in credit card debt — and over $130,000 in total debt.

Debt is a drag — on on your credit score and savings, but also on your psyche.

While debt is mathematical, it's also highly personal. Some people might feel that a mortgage is good, manageable debt, and others might feel the pressure of owing their lender money. Some might consider student loans to be a necessary evil, and others might do anything in their power to avoid them. The one exception to this rule is consumer debt of the sort that comes from credit cards and personal loans, which is widely regarded as the worst possible type due to its high interest rates and lack of return on your expenditure.

A mortgage or student loans happen in an instant, when you decide to sign on. But other, potentially more expensive and insidious debt can creep up on you. To help you figure out whether you might be in danger, we've rounded up eight red flags to watch out for.

You can barely pay your bills each month

Are you counting down the days to payday, hoping you'll have enough to meet your obligations each month? This is known as "living paycheck to paycheck," and could quickly spiral into credit card debt — plus, it makes it nearly impossible to build up significant savings.

You have two options if you find yourself in this situation: Earn more money, or spend less. If you go the first route, take a look at lifestyle changes to make if you want to earn more, steps to negotiate a raise, and ways to make extra cash while working full-time.

If you're aiming to spend less, check out lifestyle changes to make if you want to spend less and saving strategies from everyday people who retired before 40.

Check out 20 unusual ways to make a quick buck:

20 unusual ways to make quick money
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20 unusual ways to make quick money

Dog-sitting, babysitting, or house-sitting

These jobs are always in high demand, and the best part: you can name your price and create your own schedule! Post an ad on craigslist, or use your friends' and family's connections to get your name out there. 

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Rent out your space 

List your apartment on Airbnb or another rental site, and make some easy cash by staying at a friends and renting out your place for the weekend.

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Share your space

Just as you can rent out your full apartment or house, you can also post a free room (or even just your couch!) on sites like Craigslist or Airbnb. This way you can split your living expenses -- and maybe even make a new friend!

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Sell your body parts

Now here's a weird one: Donate your hair, breast milk, or even plasma for a profit. According to Grifols, if you're healthy and weigh above 110 pounds, you can earn up to $200 a month donating your plasma to life-saving medicine. 

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Sign up to participate in medical tests and clinical trials. 

Universities constantly need volunteers to test new medicines and treatments -- and because the pool of willing participants is limited, there is typically a large compensation for being a guinea pig. 

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Participate in a focus group

Companies and organizations will pay you to join a focus group. These can be conducted in person, online, or via phone. You will most likely be reimbursed in cash or gift cards -- plus, you often get to test out fun new products! 

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Take online surveys

Similar to focus groups, you can get paid to give your time and insights on an online questionairre. Plus, you can do this from the comfort of your couch. 

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Bank on your sperm

Although we don't necessarily recommend this option, there is a very high demand for healthy sperm donors. Keep in mind some of the obvious drawbacks, but sperm donation is non-invasive and highly compensated. 

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Crowdfund your dreams

Crowdfunding allows you to raise monetary contributions from a large group of people who want to support your venture. Post your project or idea on a crowdfund site, like GoFundMe.com, and see the cash pile up.

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Become a tutor

If you're qualified, post an ad online or on a community board to tutor children on their school courses or for the upcoming SATs.

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Get a part-time job

Capitalize your free time (on the weekends or after work hours) by working a part-time job. A bartender, waiter, or Uber driver are all great options for an additional source of income -- and great tips! 

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Resell tickets

Take this suggestion at your own risk: If you're staying within legal limits, buy tickets low and sell high as an effective way to source additional money. (Just make sure to check your state and local laws first!)

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You can sell anything on the internet these days... including your companionship! Get paid to go on a platonic outing for a few hours and enjoy your afternoon with a new friend. 

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Rent out your parking spot

Make sure to check with your landlord first, but if you have the option to park your own car further away, lend or share your parking space or driveway for the hour, day, or even month! 

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Keep a coin jar 

This one takes patience before a big pay out, but keep a spare jar or drawer for loose change that you usually toss anyway. It will keep it all in one place -- and those quarters do add up! 

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Make something to sell 

If you have a knack for arts & crafts, create jewelry or other handmade gifts to sell on sites filled with other thrifty vendors like Etsy

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Sell items online

This effective strategy requires low effort with a high return. Post photos of your used or non-used items on sites like eBay or Craigslist, and let the bidding begin! 

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Have a yard sale

Sell clutter you've been meaning to get rid of right in your front yard. This simple tactic is convenient, and guarantees a wad of cash right to your pocket.  

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Return past purchases

This tip may seem obvious, but is often overlooked: Take your recently-purchased items that are laying around back to the store for either store credit or a full refund. 

Recycle scrap metal and cans

Collect cans and scrap metal out your own garbage, basement, and street and bring to your local recycler to exchange your findings for money.  

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You don't set aside money for big, upcoming purchases

Big purchases are bound to surface in your future — and if you aren't prepared for them, you could wind up deep in debt.

The USDA estimates the average cost to raise a child at about $245,000, and that doesn't include college. Or, if you're looking to buy a home, you'll likely need significant savings just for the down payment. Other big purchases you may want to think about include a car, graduate school, or a vacation.

Start by establishing what is important to you and what you want your future to look like, which will make it easier to create savings goals. Next, you'll want to figure out how much you would have to save, how long you would have to save for, and at what rate of return you might need your investments to grow in order to reach those goals.

You invest differently depending on how much time you have — generally, the more time you have until you need the money, the more risk you can take. Read up on the types of asset classes in investing to figure out where you might want to put your money.

You don't have an emergency fund

While many people tend to ignore the possibility of their car breaking down, a medical emergency, or losing their job, these are all scenarios that could quickly become expensive realities. Not setting aside money could ultimately land you in debt or force you to borrow from a long-term savings account if an emergency does arise.

The amount of savings you need is highly personal, so it isn't usually measured in terms of dollars. Rather, it's months of living expenses that money could cover. A general rule is that it's smart to have six months' worth of savings tucked away, but you may need more or less depending on your situation.

You spoil your kids

According to a survey from T. Rowe Price, nearly half of American parents have gone into debt to spoil their kid.

What's more, 57% of parents said they spend too much on things their kids don't need, and 55% have dipped into their emergency funds to cover non-emergencies, like day-to-day expenses.

Start by deciding whether you're spoiling your kid — if you are, read up on strategies to raise children who aren't spoiled.

You can't pay more than the minimum on your credit card balance

If you can't pay more than the minimum month after month, you're overspending and headed straight towards credit card debt. You should always aim to pay your credit card balance in full to protect your credit score and to stay out of debt — and if you can't, you're living beyond your means and falling behind on your savings.

Divert money from another part of your budget or cut back on spending to free up your cash to pay more than the minimum. In the long run, paying only the minimum will cost you a fortune.

You try to show up your friends

Do you choose where to live, what to wear, where to eat, and what gadgets to buy based on what your friends do? While living up to your neighbors' or coworkers' standards can be tempting, it can also be detrimental to your finances.

In fact, the Wall Street Journal reported that, "Many people would rather struggle to pay off a large credit-card bill than utter the phrase 'I can't afford it.'"

Be aware of friends who tempt or pressure you to spend too much money. Just because your friend can afford to buy the latest iPhone and live in a high-rent neighborhood doesn't necessarily mean you can, too. Plus, research has shown that if you and a friend both turn down an expensive purchase you can't afford, it will actually strengthen your relationship.

You don't have health insurance

It's easy to feel invincible when it comes to health, or to ignore the possibility of a medical emergency. This invincibility complex is costly, as medical bills are the biggest cause of personal bankruptcy.

It's important to plan for the worst, as an unanticipated emergency could turn your life upside down instantaneously.

Check out this young adult's guide to affordable health insurance to get started.

You don't know how much you're spending every month

Most of us know how much cash is flowing into our bank accounts each month — but just how much is flowing out? Do you know how much you spend eating out, on monthly subscriptions, or on coffee? It's probably more than you think.

To get an idea of your weekly expenditures, try tracking your cash flow by recording each purchase you make in a spreadsheet or notebook, or downloading an app that will categorize and monitor your monthly and annual spending, such as Mint, You Need a Budget, or Personal Capital.

After all, it's nearly impossible to make smart financial decisions if you're only guessing how and where you spend your money.

See Also:
What 17 successful people wish they'd known about money in their 20s
A new app aims to fix a $1 trillion problem by making credit cards cheaper and easier to manage
9 signs you aren't as good at investing as you think you are

SEE ALSO: 7 steps anyone can take to get out of debt

RELATED: Helpful tips to teach your children to save money:

Lessons that teach your kids to save money
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Lessons that teach your kids to save money

Play money-centered board games or games on apps, like Monopoly or Money Race.
It's an interactive and fun way for your kids to learn about basic financial practices without feeling like they're being lectured.

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Give them an allotted amount of cash to spend on lunch each week.
Your child will learn how to budget accordingly throughout the week, figuring out how to balance spending money on food some days vs bringing their own on other days (something that can be directly translated into the adult workplace).

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Have them write down or tell you their absolute dream toy.
Then, show them that it's possible to have that toy if they save x enough money for x amount of weeks.

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Give them an allowance.

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Stick to a set time and date each month for giving your child their allowance.
Practicing giving your children their allowance every other week or on certain dates of each month will help them prepare for set paydays in the working world--it will teach them to budget out and how to know when to save up in anticipation.

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Match your child's savings each month.
This will imitate a 401K and show your child ways in which saving can (literally) pay off.

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Have your kid organize their funds in to different jars to represent different accounts.
Examples could be "Saving", "Spending", "Charity", "Emergency", "College".

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Take your kids grocery shopping and explain certain choices you make with your purchases to them.
Your children will benefit from knowing what's best to purchase name brand vs. generic, why some snacks are better to buy in bulk, etc.

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