Debt is a burden for many. In fact, it’s the biggest source of financial stress for Americans, GoBankingRates found in a August survey.
But to find out exactly what type of debt is weighing down people the most, GoBankingRates surveyed nearly 3,000 adults across the U.S. and asked what their largest source of current debt is — mortgage, credit card, student loan or medical debt. We also asked respondents to provide the dollar amount of each type of debt they have, including auto loan debt.
Overall, mortgages are the biggest source of debt for Americans. The survey also found that a greater percentage of men than women have debt – 52 percent versus 48 percent. Older adults ages 65 and up are least likely to have debt; while those ages 35 to 44 are the most likely to be carrying debt. And adults earning $100,000 to $149,999 were more likely to have debt than respondents in any other income bracket.
Mortgages Are the Biggest Source of Debt
Considering that the most-recent U.S. Bureau of Labor Statistics’ figures show that housing costs are the biggest component of household spending, it’s not surprising that loans taken out to buy homes are the biggest source of debt for those surveyed by GOBankingRates. About 20 percent of respondents named mortgages as their biggest source of debt.
The median mortgage debt among those surveyed is $59,500. Adults ages 35 to 44 are the most likely to have home loan debt, with 51 percent reporting that they have mortgages. Respondents in this age group also have the highest median mortgage debt — $100,000.
A greater percentage of men than women have mortgage debt – 41 percent versus 36 percent.Yet, the median amount owed by women with mortgages is higher than the median amount owed by men — $74,000 versus $60,000. And a greater percentage of adults earning $100,000 to $149,999 have mortgage debt than any other income bracket. Plus, this group owes the highest median amount — $150,000.
Refinancing your mortgage can be a good way to reduce the amount of interest you’re paying on your debt and lower your monthly mortgage payments. But if you don’t have enough equity in your home to refinance, you might have to look for other ways to deal with this source of debt, said Neal Frankle, a certified financial planner and managing editor of CreditPilgrim.com.
Consider renting a room in your house or getting a second job to generate extra income to tackle your mortgage debt. “As a last resort, sell your place and buy a home you really can afford or rent,” Frankle said.
Student Loans Are the Biggest Source of Debt for Millennials
Student-loan debt is the biggest source of debt for those ages 18 to 34 and the second biggest source of debt among all respondents. Among 18- to 24-year-old millennials, 36 percent have student loan debt, and the median amount owed is $10,000. More than 40 percent of older millennials ages 25 to 34 have student loan debt, and the median amount owed is $14,000.
Although a smaller percentage of young Gen Xers ages 35 to 44 have student loan debt, the median amount they owe is the highest of those surveyed — $15,000. Although about an equal percentage of men and women have student-loan debt,women have almost twice as much.
The median amount owed by women is $15,000 versus a median of $8,000 owed by men. And those earning $150,000 and up have the highest student-loan debt burden – a median of $60,000 owed. If you or your child are heading to college soon, there are ways to avoid racking up debt.
“It may feel like student loans are your only option, especially when you’re really sold on a particular school,” said Kristina Ellis, author of “How to Graduate Debt-Free: The Best Strategies to Pay for College #NotGoingBroke.” “But before signing on the dotted line, make sure you’ve assessed every alternative.”
For starters, consider attending a more affordable school or starting at a community college then transferring to a four-year school, she said. Apply for scholarships throughout college, not just before your freshman year. And get a part-time job to help cover costs. If you’re going to college on borrowed money, take only the courses you need to meet your major and graduation requirements so you can graduate in four years.
Read: How to Prepare for Life’s Financial ‘What Ifs’
“Each additional year could create a need for more loans,” said Ellis. “Don’t let a lack of planning lead to thousands of dollars in additional debt.” Also, make sure you don’t borrow more than you need to fund expenses beyond college costs, such as trips and summer living costs.
For those graduating with student-loan debt, Ellis recommended making more than the minimum monthly payment, if possible, to accelerate your loan payoff. Or, you can simplify and reduce your student loan obligations by consolidating into a single loan with a lower interest rate. “There’s still a lot to consider when refinancing student loans, including terms, fixed versus variable rates and fees,” she said. “However, the right refinance strategy can yield a great amount of savings.”
Higher-Income Adults Have More Credit Card Debt
Nearly half of respondents earning $100,000 to $149,999 have credit card debt – the highest percentage of all income brackets. And the median amount they owe is $6,944.However, those earning $150,000 and up actually owe more – a median amount of $11,750.
Leslie H. Tayne, a financial attorney and author of “Life and Debt,” said it’s not surprising that higher income people have more debt. “The more income you have, the more you spend,” she said. This is something she sees among her clients who use credit to support their expensive lifestyles.
Americans of all income brackets have come to rely more and more on credit because it’s easy to get and because they have adopted a buy-now-pay-later mindset, Tayne said.
“We’ve gotten away from buying things we can afford to buying things we can’t afford by making monthly payments,” she said. However, credit cards should only be used to make purchases that you know you can pay off every month.
If you have credit card debt, Tayne recommended tackling the balance on your highest-interest rate card first. “Once you see your debt go down, you will get motivated to pay off the rest,” she said. “This might mean cutting some of your non-essential expenses such as date night, eating out for lunch and even movie channels to help you reach your financial goal.”
Read: The Number One Cause of Financial Stress in Each State
Also, call your card issuer to negotiate a lower interest rate to reduce the total amount you’ll have to pay over time. “Let them know you are a loyal customer and the last thing you want to do is go with another provider,” said Tayne. “If this fails on the first try, persistence is key.”
Lower-Income Adults Have the Most Medical Debt
The survey found that respondents earning $0 to $24,000 have the highest median medical debt: $1,500. This income group also has the highest percentage of respondents with medical debt: 27 percent.
The median amount of medical debt owed by women is twice the median amount owed by men – $1,000 versus $500. And those ages 35 to 44 have the most medical debt, with a median of $1,267 owed.
To avoid racking up medical debt, Tayne recommended creating an emergency fund for medical expenses. Set up automatic transfers from your checking account to a savings account each month so the money comes out before you have a chance to spend it.
If you’re struggling to pay your medical debt, let your healthcare providers and creditors know, added Tayne. They might work with you to set up a payment plan you can afford. Or, reach out to a non-profit credit counseling agency to get help managing your debt, she said. You can find certified counselors at NFCC.org, the website of the National Foundation for Credit Counseling.
Read: What Is a Good Debt-to-Income Ratio?
Auto-Loan Debt Highest Among High-Income Earners
Respondents earning $150,000 and up have the highest median auto-loan debt by far — $40,000. Yet, just 17 percent of respondents in this group have auto debt, which is the smallest percentage of any income group.
Adults ages 45 to 54 are most likely to have auto-loan debt, with 37 percent reporting that they owe money on a car. And women have more auto-loan debt than men – a median of $10,000 versus $8,000.
To reduce your auto-loan debt, you may be able to refinance with a bank at a lower interest rate, Frankle said. “If that doesn’t work, your only option is to find a way to earn more so you will have the scratch to make the payments,” he said.
However, if you’re auto-loan debt – or any debt – is too much to handle, you need to ask yourself what you could have done to avoid this problem. “Sometimes circumstances are beyond our control, but more often than not, getting into debt we can’t afford is a choice,” Frankle said. “Get to the bottom of why you are where you are and make a commitment to yourself to never repeat the mistake.”
This article originally appeared on GoBankingRates.