There is no denying that everyone is in debt one way or the other. Everyone owes everyone a sum of money, with some having a bigger amount of debt than others. Too much debt can become dangerous to the point that it can take away a person’s adulthood. It may take an entire lifetime to repay a debt, or sometimes even one lifetime is not enough to repay a large debt.

Adulthood should be spent enjoying what you have earned in your young adult career. You may accumulate debt when you start working in your 20s but you need to pay it off immediately before or when you reach your 30s. Most of the time, people become financially secure when they reach their 30s. People get married, have children, buy a house, buy a car, go on vacation trips, and invest in long-term securities. That is how adulthood should be spent, even if you are indebted to a person, a bank, or other financial institution.

But, why do some people still go very deep into debt where it gets to the point they suffer a financial crisis? Here are some very clear reasons as well as some uncommon ones. It is much better to be aware of these than to ignore the warning signs that you could be sinking into greater amounts of debt.

You do not live within your means

This is the most common and probably the number one reason why people go into deep debt. Of course, it is very tempting to buy that $5,000 Versace outfit or spend for that one week tour package around Europe. But then what will you do if you still have something to spend on after you have already purchased these expensive things? Unfortunately, people who overspend will loan from other parties. This is where loan accumulation begins.

As the famous quote goes, “live within or below your means”. If you are looking for a quote to keep you grounded and financially secure, this is probably it. Spend on the things that keep you alive and safe like food, clothes, and a house. Additionally, buying new clothes every month or eating at restaurants is just not necessary. You can spend for life’s luxuries if you have something extra to spend for it, not loan from other parties.

You owe too many people

Another common reason why people go into debt is that they owe money to too many people, sometimes at the same time. How can you possibly manage to repay all your debts if you pay off one debtor and still owe other people a big amount of cash, and all of them want to get back their cash at the same time?

If you owe a sizeable amount to one person, it is highly advisable that you avoid getting a loan from another person or another financial institution. This keeps your debts low and repayment plan ability manageable. Additionally, do not loan if you plan on using that loan to repay another loan. It is still classified as a loan.

You rely too much on credit

Credit is good when you forget to bring cash and you need to spend for something immediately. Credit becomes dangerous if you use it on a constant basis. If you have cash on hand, pay for it right away. The problem with over-reliance on credit is that it accumulates very fast, especially if you use it constantly. Eventually, you will be paying not only for the credit amount, but also the interest fee that comes with it. Additionally, if you already own one credit card, why still apply for another? If you still plan to apply for another card, make sure you have settled the balance from your previous card or kept the balance at a low amount.

You are not financially literate

Sometimes, it just comes down to a little bit of education, specifically financial literacy. It goes a long way for you not only to become financially literate, but financially secure. You do not need to go to business school just to gain insights on savings, investments, and debts. There are numerous private and public institutions that offer financial literacy seminars for free. You can also just Google everything. Investopedia, Kiplinger, Wise Bread, and are some online sources that offer not only financial advice, but also act as encyclopedias for all terms and things related to finance.

If you have already obtained sufficient financial knowledge, you can always put it into good use and make your own payment plans for your daily or monthly expenses. This will aid you in avoiding the debt trap and live the rest of your adulthood the way you initially want it to go.

Debt should not be a problem as long you make smart financial decisions. Always remember the things listed above on why people go into a deep debt such as not living within their means, being indebted to too many people, relying too much on credit, and not being financially literate. This will help you, your family, and friends to be more aware of how debt can cause major problems which can last for more than a lifetime.