The Average Millennial Has Nearly $30K in Debt. Here Is What They Should Do. (2024)

NEW YORK – March 14, 2023 – ( )

Credello: Studies show that Millennials often have debt. The average amount is almost $30K. Some have more, while others have less, but it’s a sobering number.

There are actions you can take if you’re a Millennial and you’re carrying this much debt. We’ll talk about some strategies right now.

Get a Personal Loan

Many Millennials are paying for things with credit cards. This is tempting, but it can backfire. Credit cards can have interest rates close to 35%.

If you have several outstanding debts, how much of a personal loan can I get should probably be the question you’re asking. If you approach a bank or credit union and get a personal loan, you can use that money to pay off your debts.

Why Are Personal Loans So Attractive?

Getting a bank or credit union loan simplifies your life. If you do this, you only have one loan to repay, rather than owing several different credit card companies and other entities.

Also, when you get a personal loan, you’re liable to pay much less in interest when you’re repaying it than you would if you’re paying off outstanding credit card debt. We mentioned that credit cards can charge as much as 35% in interest, but you usually pay far less with personal loans.

You can sometimes get interest rates of 8% or lower with personal loans if you have excellent credit. If your score isn’t the best, you might still get an interest rate of 15% or lower. That’s much better than the 30-35% you’d likely pay with credit cards.

What Else Can You Do?

As a Millennial dealing with debt, you’ll know a set amount you must pay each month once you have a personal loan. The next step toward financial responsibility is to pay all your other bills on time.

With a personal loan in place, you owe money to one entity as a set payment amount each month. You will also have monthly expenses such as rent, utilities, groceries, and car payments.

If you set up a household budget and stick to it, you can stay on top of those other bills while you pay off the personal loan. You can create a spreadsheet showing how much money you’re bringing in and the cost of your expenses.

Improve Your Credit Score

When you make payments on your personal loan and on-time payments of your bills, that will gradually improve your credit score if it isn’t so great. Making on-time payments raises your VantageScore and FICO scores. That’s always to your benefit.

You should not open any new credit card accounts if you can avoid it. That way, you won’t be tempted to use one of your new cards and spend beyond your means.

You can also set up autopay for your bills. You can set up a service that monitors when you pay your bills and reports that to the major credit bureaus.

You Can Chip Away at Your Debt

If you’re a Millennial with tens of thousands of dollars in debt, you can consolidate the entities to which you owe money by getting a personal loan from a reputable lending entity. You can use that money to pay off your credit cards and other debt.

You’ll likely pay far less interest on your personal loan than credit card interest. You’ll have one entity to pay each month, and you’ll know the amount that’s due.

In addition, you can budget by setting up a spreadsheet and calculating how to spend the money you have coming in on your monthly bills. If you don’t miss any payments, you’ll stay on top of those bills, and you’ll raise your credit score.

You should have excellent credit by the time you’ve paid off the personal loan. You’re now in a position to keep your credit score high and avoid getting deep into debt through frivolous spending habits.

About Credello

Credello is a financial tech company offering a personal finance tool that simplifies financial decisions through personalized, on-demand recommendations — so users can borrow, save, or invest with confidence.

Credello believes that finding the right financial product should be as easy and interactive as online shopping and we are on a mission to make that possible. For more information, please visit

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Original Source: The Average Millennial Has Nearly $30K in Debt. Here Is What They Should Do.

The Average Millennial Has Nearly $30K in Debt. Here Is What They Should Do. (2024)


The Average Millennial Has Nearly $30K in Debt. Here Is What They Should Do.? ›

If you're a Millennial with tens of thousands of dollars in debt, you can consolidate the entities to which you owe money by getting a personal loan from a reputable lending entity. You can use that money to pay off your credit cards and other debt.

How to get rid of $30,000 in debt? ›

Get in touch with a debt relief service

And, debt relief services typically help you in one of two ways: debt consolidation or debt forgiveness. If you choose a debt consolidation or debt management program, experts will typically try to negotiate your interest rates and payment terms with your lenders on your behalf.

How much debt does the average millennial have? ›

Average total debt by age and generation
GenerationAgesCredit Karma members' average total debt
Gen Z (born 1997–2012)Members 18–26$16,283
Millennial (born 1981–1996)27–42$48,611
Gen X (born 1965–1980)43–58$61,036
Baby boomer (born 1946–1964)59–77$52,401
1 more row
Apr 29, 2024

Is 30k in debt a lot? ›

If you are over $30k in credit card debt, it may be more than you can handle through do-it-yourself efforts. If you're not making progress on your own, it may be time to contact a professional debt settlement company such as ClearOne Advantage.

How long does it take to pay off 30k in debt? ›

It will take 41 months to pay off $30,000 with payments of $1,000 per month, assuming the average credit card APR of around 18%. The time it takes to repay a balance depends on how often you make payments, how big your payments are and what the interest rate charged by the lender is.

What is the fastest way to get out of big debt? ›

How to get out of debt
  1. List out your debt details.
  2. Adjust your budget.
  3. Try the debt snowball or avalanche method.
  4. Submit more than the minimum payment.
  5. Cut down interest by making biweekly payments.
  6. Attempt to negotiate and settle for less than you owe.
  7. Consider consolidating and refinancing your debt.
Mar 18, 2024

What's the smartest way to get out of debt? ›

Consider the snowball method of paying off debt.

This involves starting with your smallest balance first, paying that off and then rolling that same payment towards the next smallest balance as you work your way up to the largest balance. This method can help you build momentum as each balance is paid off.

What is the average wealth of a millennial? ›

The average millennial under age 35 has a net worth of about $76,000; those over age 35 stand at over $400,000. Members of Generation X have average net worths between $400,000 and $833,000, and older generations including baby boomers and the Silent Generation have average net worths of over $1 million.

Are millennials in serious debt? ›

Americans — particularly Millennials and those with lower incomes — are becoming increasingly overextended financially: Credit card and auto loan delinquencies have not only surpassed pre-pandemic levels, they're the highest they've been in more than a decade.

How many millennials are financially stable? ›

According to data from the 2019 U.S. Financial Health Pulse consumer survey, only 24 percent of Millennials are Financially Healthy. 81 These individuals are spending, saving, borrowing, and planning in a way that will allow them to be resilient in the face of unexpected events and pursue opportunities over time.

How to pay $30,000 debt in one year? ›

The 6-step method that helped this 34-year-old pay off $30,000 of credit card debt in 1 year
  1. Step 1: Survey the land. ...
  2. Step 2: Limit and leverage. ...
  3. Step 3: Automate your minimum payments. ...
  4. Step 4: Yes, you must pay extra and often. ...
  5. Step 5: Evaluate the plan often. ...
  6. Step 6: Ramp-up when you 're ready.

How much debt is unhealthy? ›

Generally speaking, a good debt-to-income ratio is anything less than or equal to 36%. Meanwhile, any ratio above 43% is considered too high. The biggest piece of your DTI ratio pie is bound to be your monthly mortgage payment.

How much credit card debt is bad? ›

The general rule of thumb is that you shouldn't spend more than 10 percent of your take-home income on credit card debt.

How to wipe credit card debt? ›

Outside of bankruptcy or debt settlement, there are really no other ways to completely wipe away credit card debt without paying. Making minimum payments and slowly chipping away at the balance is the norm for most people in debt, and that may be the best option in many situations.

How to pay off debt fast with low income? ›

  1. Step 1: Stop taking on new debt.
  2. Step 2: Determine how much you owe.
  3. Step 3: Create a budget.
  4. Step 4: Pay off the smallest debts first.
  5. Step 5: Start tackling larger debts.
  6. Step 6: Look for ways to earn extra money.
  7. Step 7: Boost your credit scores.
  8. Step 8: Explore debt consolidation and debt relief options.
Dec 5, 2023

What is the quickest way to pay off credit card debt? ›

The avalanche method has you focus first on repaying your highest-interest debt until it's completely gone. You then move on to the debt with the next-highest interest rate and so on. Paying more money toward your highest-interest debts may help you save money in interest payments in the long run.

What debt will be forgiven? ›

The proposal would permit student debt forgiveness for borrowers with only undergraduate debt if they first entered repayment at least 20 years ago (on or before July 1, 2005), and borrowers with any graduate school debt would qualify if they first entered repayment 25 or more years ago (on or before July 1, 2000).

How to pay off $20k in debt fast? ›

Use a debt consolidation loan

This allows you to make one monthly payment rather than paying multiple creditors. You may also get a better rate compared to your credit card APYs, saving you money in interest. A debt consolidation loan is especially useful if you are trying to pay off multiple credit cards.

How to pay off credit card debt when you have no money? ›

  1. Using a balance transfer credit card. ...
  2. Consolidating debt with a personal loan. ...
  3. Borrowing money from family or friends. ...
  4. Paying off high-interest debt first. ...
  5. Paying off the smallest balance first. ...
  6. Bottom line.
Apr 24, 2024

Is 20k in debt a lot? ›

$20,000 is a lot of credit card debt and it sounds like you're having trouble making progress,” says Rossman.


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