What do we owe society

Debt

What is over-indebtedness?

One speaks of over-indebtedness when a person or a family can no longer fall back on savings and the monthly income no longer covers the expenses for rent, electricity and other obligations such as installment payments - and that in the long term.

40 percent of households can no longer cope with debts that are less than 10,000 euros. Young adults who still live with their parents and earn little money often have a debt burden of 1000 euros over their heads.

Young people in particular run the risk that they will find it difficult to get out of the spiral of debt and that they will find themselves in a vicious circle for years, in which the old installments are paid with new debts.

Who can it hit?

No matter whether man or woman, young or old, with a doctorate or without training: Anyone can get into a situation in which a mountain of debt is piling up in front of them.

The majority of over-indebted people are between 30 and 50 years old. At this age, many start their own families, buy an apartment or take out loans. If something unforeseen then happens, the road to over-indebtedness is not far away. Even the unplanned birth of a child can be financially overwhelming.

The income of the people who get into bankruptcy is usually very limited. 30 to 40 percent of those affected who cannot find their way out of their debts on their own are Hartz IV recipients. Your financial leeway is so narrow that it is just enough for the bare essentials for life. If then installments have accumulated, the situation is almost hopeless.

What Causes High Debt?

Separation and divorce are the most common reasons that lead to over-indebtedness. Those affected in this life situation have to deal with double housekeeping. Rent, electricity and everything that goes with shaping life have to be paid twice, although the disposable income mostly remains the same.

In the event of divorce, it can also happen that a woman sits with her ex-husband's mountain of debt if she signed a guarantee for her husband's business or company at the time of the marriage. If the company goes bankrupt and both separate, the divorced wife has to pay for the guaranteed debts.

However, if it is a so-called "housewife marriage" in which the partner did not work and was responsible for looking after the family, she can refer to this fact and may not have to pay off the guarantee. However, the limits for this are tight.

Unemployment and consumption

Another major reason people fall into debt is unforeseen unemployment. The financial obligations that you entered into by buying a house or a car can then no longer be afforded.

If those affected have neither a professional qualification nor an educational qualification, the way back into the world of work is usually difficult.

And finally, there are the lure of consumption, which some cannot resist in spite of meager pockets. Advertising also doesn't make it easy to pass seductive offers. In addition, social status today is very often equated with the possession of material goods.

By buying on credit, the consumer can immediately access the abundance of offers. According to the motto "buy now, pay later", the door is wide open to indebtedness. But be careful: Those who gloss over their financial situation when buying on credit can even come under suspicion of fraud.

Author: Sabine Kaufmann