Which types of debts are hardest to pay off in 2023

types of debt
Paying off debts is hard. Some people even admit to feeling an emotional attachment to their debt because it connects them to who they used to be or how they lived. The type of debt people finds the hardest to pay off often depends on what they were using the money for in the first place. For example, credit card balances are typically harder to pay off because that money was likely spent frivolously and on things that don’t add any value or memories in a person’s life. On the other hand, student loan payments can feel like a burden if you’re paying back loans from college where your education didn’t lead to anything tangible.
In both cases, though, there is no reason why someone should struggle with these types of debts when they could use some help getting out of this situation. Instead, find yourself struggling to make ends meet. It may be time to consider taking advantage of debt consolidation options available through reputable companies such as Legal and Debt Solutions.
  • Personal debt: Debt accumulated through personal expenses such as credit cards, mortgages, car payments, student loans, etc. The average South African is in debt to R200 000 per person. This means that the amount of debt in South Africa is over 3 trillion Rand. We are spending too much money on unnecessary items and not enough on our future selves. One way to avoid this dilemma is to take a look at your expenses each month and ask yourself if these purchases are worth it.
  • Medical debt: Debt created by medical expenses not covered by Medical Aid – Medical debt is a form of debt created by medical costs not covered by insurance. It often includes high-cost procedures such as chemotherapy, transplants, and expensive surgeries.
  • Student loans: Debt acquired to attend a university by private lenders – Student loans are a type of debt developed to participate in a university. The loan is acquired by private lenders, which have their repayment terms. Along with the repayment being different, each lender has its requirements for getting a student loan and can vary per school.
  • Mortgages: Debt for a home loan and one of the largest sources of personal debt in most countries – It’s not uncommon to take on a mortgage when you purchase your first home. Most mortgages, however, are for 15 years, and then the homeowner has the option to pay it off or extend it for an additional ten years. Mortgages are often one of the largest sources of personal debt in many countries, and they’re also one of the most common reasons people file for bankruptcy.
  • Car payments: Payment used to purchase a vehicle and one of the main causes for personal debt due to car accidents – In today’s society, owning a car has been made increasingly necessary by the increasing number of jobs requiring a commute. Yet, some people may not realize that a vehicle is one of the leading causes of personal debt due to car accidents. Many people have found themselves with a low credit score and high payments to keep their car on the road.
In conclusion, it’s essential to look at your money obligations and think about which ones you can pay off first. An excellent way to prioritize is to look at how much a particular debt costs you a month and then compare that cost to the amount of money you have coming in each month.
After looking at your debts, it’s essential to make a plan for what to do with your money.