Americans are carrying a lot of debt. According to the Federal Reserve Bank of New York’s Center for Microeconomic Data, total household debt increased by $266 billion in the first quarter of 2022, making it so that everyone owes a collective $15.84 trillion, and credit card balances were $71 billion higher than a year earlier.
What’s too much debt on the individual level? Try to never let your debt-to-income ratio reach 30%, suggests Peter Casciotta, owner of Asset Management & Advisory Services of Lee County in Cape Coral, Florida. In other words, if you’re making $100,000 a year, you’d want no more than $30,000 to go toward the debt (good or bad).
Don’t panic if your debt-to-income ratio is higher. Some experts suggest 35% is OK. But everybody generally agrees that if 50% or more of your income is going to debt, you need to take action, now. Here are some expert-backed suggestions on what to do if you’re deep in debt.
This post originally appeared at US News & World Report.