The average American has so much debt. How does yours compare?

American consumers are generally no strangers to debt. People borrow money all the time, whether it’s to buy a car or to pay essential bills that are too much for their salary.

But recent data from The Motley Fool Ascent shows that in 2023, American consumers had an average debt load of $104,215.

As of 2023, the average mortgage debt was $244,498. But mortgage debt is generally less problematic than credit card debt because mortgages typically come with lower interest rates and help you end up owning a valuable asset.

On the other hand, credit card debt can seriously mess up your finances. And as of 2023, the average consumer balance was $6,501. If you’re struggling to pay off credit card debt, you should know that falling behind can harm your credit and make it difficult to get affordable credit in the future.

Plus, the longer you carry credit card debt, the more it will cost you in interest. But there are steps you can take to make your debt more manageable and pay it off sooner.

1. Consider a balance transfer

One of the problems with credit card debt is that the interest rate on it can rise over time, making it more expensive. Not to mention, the interest rate you pay may be exorbitant to begin with.

If you have a good credit history and owe money on several different cards, you may want to consider a balance transfer, in which you transfer your existing balances to a new credit card with a lower interest rate. Many balance transfer offers have an introductory rate of 0%. Thus, you can get a deferment from accruing interest for 12, 15 months, and sometimes longer. Click here for a list of the best credit cards for balance transfers..

If you can get a 0% introductory rate on a balance transfer, it’s worth taking up a side hustle so you can supplement your income and free up more money to pay down debt. You’ll want to pay off as much of your debt as possible before this introductory period comes to an end and interest begins to accrue on your remaining balance.

2. Consolidate your debt with a personal loan.

A personal loan can be a more affordable option for borrowing money than credit cards because you’ll likely qualify for a lower interest rate if your credit is in decent shape. And personal loans offer fixed interest rates, so your monthly payments are predictable. This alone can make managing your debt easier.

If you are looking for a personal loan, check out this list of the best personal loan lenders.

3. Consolidation with a home equity loan

It is a big myth that you can only take out a home equity loan to renovate or improve your property. Like personal loans, home equity loans allow you to borrow money for any purpose. But if you have a lot of equity in your home, you may find that you can borrow at a lower interest rate than what a personal loan would give you.

Of course, there is a danger in taking out a loan against your home equity. If you fall behind on payments, you could end up losing your home. But you may find that it’s a good option if you’ve lived in your home for a while and have enough equity in it. Click here to view our recommended list of the best mortgage lenders..

You should also know that there is a big difference between a home equity loan and a home equity line of credit (HELOC). With a HELOC, you typically factor in variable interest rates on your debt, which can make it more difficult to pay off. This way, you can limit yourself to a home equity mortgage only.

If your debt has reached the point where it is no longer manageable, then it’s worth exploring these options to make it easier and more affordable to keep up. And remember: If you’re doing well on your mortgage payments, you don’t have to worry about paying off your loan early. Instead, focus on your credit card balance, which will likely cause much more harm to your finances.