Total US consumer
household debt is $13.3 trillion in 2018.
Good Debt - US
consumers owe $8.8 trillion in mortgage loans. This is good debt, especially if
it’s a 15 year loan or can be prepaid. This debt turns into an asset, because
home values appreciate.
OK Debt - US consumers
also owe $1.38 trillion in auto loans. This is not good debt, because vehicles
depreciate in value over time. But if you buy a Toyota Prius and get 50 miles
to the gallon, the Prius pays for itself in 10 years in gasoline savings.
Vehicle loans are often “necessary” expenses for commuting to work and personal
use. There are no good alternatives and vehicle ownership is a necessity. Many
new cars are exceeding 300,000 miles
Bad Debt - Student
loans total $1.5 trillion. This is the worst debt you can have. The average
student loan debt is $37,000. The average undergraduate loan interest rate is
4.45%. Universities are toxic liberal propaganda factories.
Bad Debt - US consumer
Credit card interest costs totaled $104 billion in 2018. This is uncalled for
and is absolutely avoidable. Consumers need to pay their credit card balances
off completely every month.
US consumer
“non-mortgage debt” is expected to reach $4 trillion by the end of 2018. This includes car loans, student loans,
personal loans and credit card interest.
The media reports news
on the economy, but it is geared to encourage big spending. It’s a scam. US
consumers need to use more of their money to pay down their personal debts. I
would consider “non-mortgage” debt reduction as the primary measure for our
recovering economy.
Norb Leahy, Dunwoody
GA Tea Party Leader
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