Signs You Have Too Much Debt

by Lynn
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Signs You Have Too Much Debt

Debt can boost your finances and it can also drive you into depression depending on how you use it. There are a lot of reasons why we have debt from credit cards, student loans, mortgages, and car loans. It’s perfectly okay to have a decent amount of debt. However, there’s a maximum amount of debt you should have based on your sources of income and expenses. Having too much debt can interfere with your savings plan and budget. The trick is knowing how and when to use debt.

Here are several signs you have too much debt;

You Don’t Know How Much You Owe

One of the signs you have too much debt, is you don’t know how much you owe. If you’re afraid of calculating how much debt you owe, so you ignore it. Chances are you are in too much debt. Ignoring how much you owe will not make it go away, you have to own your debt in order to dig yourself out of that hole. Take charge of your finances by knowing how much debt you actually owe and how it’s affecting your financial life. Once you see what you owe in a list you can now start making plans on how you will settle your debt. Learn how to make a debt management plan and go from there. This will help you take charge of your finances.

Late Payments

If you are always making late payments towards your debt, you might be in too much debt. Your debt should never exceed your income and expenses. If you’re making late payments, it means you have more debt than income. Late payments mean increased interest and in some instances accrued penalties. List all your debts on one list and make a minimum payment for each until you clear without stretching your finances.

Borrowing Money to Repay Other Debts

If you borrow money to repay other debts, this is one of the signs you’re in too much debt. If you have borrowed money from your friends and family to repay your debts, you have too much debt. When you repay one debt just to borrow another loan, you are in too much debt. Create a budget that will help you with managing your income, expenses, and debt repayment. This way you will account for every shilling that leaves your account.


If you have been blacklisted by credit bureaus and you can no longer borrow from an approved lender, you’re in too much debt. Being blacklisted by a credit bureau is one of the signs you have too much debt. You want to maintain a healthy credit score to prevent denial of loans by credit-worthy institutions like banks. Make a point of improving your credit scores by repaying your debt on time and not skipping any monthly payments.

Your Paycheck Goes to Debt Repayment

If a huge chunk of your salary goes to debt repayment, you are in too much debt. After every payday, you should have a budget allocated to your expenses, savings, debt repayment. However, if most of your salary goes to debt repayment, you might want to reevaluate and reassess your debt.

Ignoring Phone Calls From Debt Collectors

When you start getting phone calls from debt collectors, you have made a late payment, or you have skipped a payment. This is a sign you have too much debt. More importantly, when you start ignoring phone calls from the debt collectors because you have no money, you’re in too much debt. When the debt collectors start calling your next of kin asking you to repay your debt, you’re in too much debt.

No Savings

If you have drained your savings, or you have no savings because of your debt situation, you need to take action. The lack of savings means you have more debt than you can take on. It also means that in the event of an emergency, you have no fallback plan which means you will have to rely on debt.


If you’re stressed about your financial situation, this could be a sign that your debt has gotten out of control. When your debt situation starts to affect you when you’re working or sleeping, you might want to reevaluate. Make a plan to deal with your debt so as to manage your stress. If you turn to alcohol or drugs to avoid dealing with your financial situation, you might want to seek support. You can get emotional support from friends and family as this is a red flag. Make a debt repayment plan and start taking control of your finances bit by bit.

RELATED: Debt repayment plan: The ultimate guide

You Need Debt to Survive

If you don’t have enough cash to sustain your lifestyle and your day-to-day needs, you might be in too much debt. If you rely on debt to finance your lifestyle, you’re living dangerously. Money may never be enough, but you can use the little you have efficiently.

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