Most Americans carry some amount of debt — often a lot of it — and many of us might juggle a mortgage, car payment, and student loans without feeling overwhelmed. But if you’ve ever struggled with a crushing amount of debt, you know the sinking, desperate feeling that follows you wherever you go. You know what it’s like to wonder how you got in this position — and how it feels to worry that you’ll never dig your way out.
But eventually, most people get to the point where they’ll do anything to escape the enormous weight of those monthly payments. In due course, they recognize that something has to change, and stay up late figuring out ways to turn it all around.
Still, it usually starts with an epiphany of some kind, and sometimes even a “light bulb” moment. Other times, people don’t realize they have too much debt until they actually reach rock bottom, or until their everyday lives become impossible.
How Much Is Too Much Debt? 14 Warning Signs
Getting into debt is easy, but realizing you’ve taken it too far takes courage and strength. Here’s how more than a dozen personal finance bloggers knew that “enough was enough” — and decided it was time to make a change.
1. You’re Adding to Your Balances Every Month
“We realized we had too much debt when we were adding to it every month,” says Kelly Whalen of The Centsible Life.
When you’re not tracking your spending or watching those credit card balances closely, “adding to the pile” is easy to do. For Whalen, the key to turning her situation around was simply recognizing that her balances were growing in the first place.
“It was hard to notice that trend at first as we weren’t tracking our finances carefully and had always been fine,” she said. But once they started tracking their spending, they were able to make big changes and pay off their debts over time.
Glen Craig from Free From Broke also saw his rising debt balances as a sign it was time to change.
“I knew I had too much debt when, after paying my bills, my debt still went up because of interest,” he said.
2. You’re Living Paycheck to Paycheck
For financial coach Melissa Thomas, the realization came when she found herself living too close to the cuff. “We decided we had too much debt when we had to put Christmas on credit because we were living paycheck to paycheck,” she said.
Jason Vitug from Phroogal.com also knows what it’s like to live down to his last dollar. “I would count the days to payday so I could make all the minimum credit card payments so I wouldn’t be reported late,” said Jason, adding that he would then use his available credit to pay for monthly bills and food.
When your debt payments consume so much of your income that you’re living down to the wire, it’s time to do something about it. And that’s exactly what both Melissa and Jason did; over time, they became debt-free and claimed their freedom.
3. When You Partner Up and Realize You Have Double the Debt
Getting married is a joyous occasion, but what happens when you realize your spouse has just as much debt as you do?
That’s exactly what happened to Deacon from Well Kept Wallet when he married his wife and they combined finances; practically overnight, their joint debt burden surged.
“We made decent money but felt like we could never get ahead because of our debt payments,” he says. Fortunately, he and his wife tackled their responsibilities together and are now debt-free.
4. Your Debt Payments Cost More Than Your Home
If your debt payments cost more than your rent or mortgage, you know it’s time to make a change. For Lance Cothern of Money Manifesto, the moment of truth came when he got tired of paying what amounted to a “double mortgage.”
Over the course of three years, Lance and his wife paid off more than $80,000 of student loans together. How did they do it? They “made a plan, earned extra income, and paid a ton of extra money” toward their loans each month, said Lance.
5. When Debt Stands Between You and Your Dreams
If you have a lot of debt, you may be left with few choices when it comes to your career. With huge monthly payments to service, you may not be able to take your dream job, start a new business, or live the life you truly want to live.
Michelle from Making Sense of Cents found herself in that predicament after graduating from college with tens of thousands of dollars in student loan debt. Fortunately, focusing on those loans and paying them off turned their situation around.
“My husband and I decided we had too much student loan debt when it was preventing us from following the career path we wanted to in life,” said Michelle. “It’s paid off and we are now happier than ever!”
Something similar happened to Elisabeth Kelly of Matter of Life or Debt at the beginning of her debt-free journey. “When I was flipping through a National Geographic Travel magazine, I realized how much more we could travel if we were paying closer attention to our money and got out of debt,” she said.
Elisabeth admits she’s still “plugging away” at her debts, but she knows she’ll pay them off eventually. Until then, she says, she’s focusing mostly on “budget-friendly travel.”
6. Your Net Worth Is Less Than Zero
Have you ever checked your net worth on a site like Personal Capital? If you haven’t, it’s worth exploring (especially since it’s free). By deducting your liabilities from your assets, sites like this show your true wealth.
But what if your net worth is negative — if your true wealth is less than nothing?
That’s exactly what happened to Candice Marie of Young Yet Wise.
Although she was afraid to see the numbers at first, she was curious to see the truth about her wealth — or lack thereof. “Once I subtracted my assets from my liabilities and saw I was in the negative, I knew I had to do something to change it.”
7. You Add it All Up, and Can’t Believe What You See
Jessica Garbino from Every Single Dollar knew she had too much debt the day she finally decided to add it all up. While she was scared to face the music at first, she drew on the life experiences of her immigrant grandmother to find the courage.
“I almost passed out when it totaled $56,000,” says Garbino, adding that her a-ha moment took place after watching her grandmother balance her checkbook. It was at that moment that she realized she was living irresponsibly “after all the sacrifice she and my grandfather made coming to the U.S. from Cuba.”
At that moment, Jessica knew she could no longer waste the opportunity she had been given.
Andy Josuweit, CEO of Student Loan Hero, knew his debt had spiraled out of control when he opened his first student loan bill and realized he wouldn’t be able to repay it without some serious hustling.
“I knew I had too much debt when I was 22, and received my first student loan bill (over $850!), was unemployed, and had no clue how I was going to pay. I survived by moving back in with mom and dad, cashing unemployment checks, and teaching myself how to build and sell websites to local businesses.”
8. You Can’t Afford to Buy a Home
David Auten and John Schneider, also known as the Debt Free Guys, knew they had too much debt when they found themselves renting from a friend because that was all they could afford. As two mid-30s professionals in the financial services industry, they knew they could do better.
“Our friends were buying houses and we were renting a basement,” they said.
As life partners, David and John paid off their debts together, and now teach others to do the same.
9. Your Monthly Minimum Payments Cost an Arm and a Leg
If you’re just making the minimum monthly payments, getting out of debt can take almost forever. And when your monthly minimum is more than you owe on anything else, digging your way out can seem impossible.
Grayson Bell of DebtRoundup.com found himself in that position several years ago, but has since turned his life around.
“I realized I was in too much debt when all of my minimum payments were costing me more than my mortgage,” said Grayson. “I was floating by each month, but didn’t know because I never aggregated my finances.”
10. When You Realize All Your Money Belongs to Someone Else
For financial coach Whitney Hansen, the moment of truth came when she realized her debt was making all her life decisions for her. “I wasn’t able to follow my dream of starting my own business and had to work in a job I hated, because my money belonged to someone else,” she said.
When all of your expendable income goes toward debt payments, it can be disheartening. Fortunately, Whitney found a way to improve her situation over time. “I paid it off in 10 months and never took out debt again!” said Whitney.
11. When Your Credit Score Starts to Suffer
A good credit score is essential if you ever want to buy a house, take out a car loan, or borrow money to start a business. Unfortunately, your credit can suffer if you owe too much money in relation to your credit limits.
That’s one of the first signs Linsey Knerl of 1099 Mom noticed when she decided it was time for her family to make a change.
“I knew we had too much debt when my credit score dropped because our debt to available ratio was out of whack,” she said, referring to the fact that her credit utilization was far too high.
To improve her score, Linsey did what she needed to do; she paid down her debts and didn’t look back.
12. You Realize You’re One Step Away From Disaster
Being in debt is similar to not having an emergency fund; in either situation, a job loss, unexpected illness, or family emergency could throw your finances into a tailspin.
Jackie Beck of TheDebtMyth.com decided her debt was too substantial when she got the feeling her job might be in jeopardy. “I had no idea how I would be able to make the payments if I got laid off — and I could see the writing on the wall at my job,” she said.
Another blogger, Kim Parr from Eyes on the Dollar, witnessed this exact situation with some family members before realizing she could be next. “I realized we had too much debt after watching family members lose their house to foreclosure, knowing we’d be in the same boat if one of us lost a job,” she said.
Meanwhile, Scott Alan Turner’s debt moment also came when he realized he was just one step away from disaster. “I knew I had too much debt after I closed on my house, had a big car payment, mortgage, bought a bunch of furniture on a no-no-no plan, and had drained my bank account,” he says.
13. Your Credit Card Is Denied Because You Owe Too Much
A mountain of debt can create a vicious cycle. And when you owe more than you can afford to pay back, it can be difficult to even get to work at times.
Jason Butler of The Butler Journal realized his debt was out of control when, every month, he went over his credit limit to pay for the gas he needed to get to work. And Chris Holdheide of Wallet Impact knew his time was up when his credit card was rejected at the gas pump. “I hated that feeling,” he said.
The bottom line: When you owe so much that your credit cards aren’t always being accepted, even for bare necessities, that’s a telltale sign that things have gone too far.
14. It Will Take Years to Pay Everything Off
While a small amount of revolving debt may be easy to squash right away, things can get out of hand quickly. And sometimes, you don’t realize how much you owe — and how long it will take you to pay if off — until you sit down and run the numbers.
Jeff Fruwirth from Sustainable Life Blog decided his debt was enough when he realized that even if he paid his entire salary before taxes toward his debt, it would still take him two years to pay it off.
Liz Stapleton’s light bulb moment was similar. The Friday Night Shenanigans blogger says, “I knew I had too much debt when I added up how much it cost me in interest every day, and it was more than what I made in two hours at work.”
Yep, you read that right. She was working for two full hours – every single day — just to pay interest.
Getting Out of Debt: How to Know It’s Time
If you’re in debt and ready to make a change, you have to be ready to say enough’s enough. You have to get to the point where you’re thoroughly tired of the struggle, and ready to make some sacrifices — to do whatever it takes to turn it around.
Your light bulb moment could be anything — the constant stress that comes with having lots of bills, the desire to travel more, or the simple realization that you could be doing better if you really, truly tried.
If debt is holding you back, now is your moment to decide to stop digging — and to find a way out instead. Getting out of debt won’t happen overnight, but the process can’t begin until you decide it’s time.
How did you know you had too much debt? Did you have a light bulb moment?