Understanding the Overlap Between Medical and Credit Card Debt
Medical debt is something a lot of people deal with, and it can really hurt your money situation. According to a 2022 study, about 20% of adults in the U.S. have medical bills that show up on their credit reports. On top of that, about 35% to 40% of these people also have credit card debt. This shows that many folks are juggling both kinds of debt at once, which makes things even harder to manage.
When people can’t pay their medical bills right away, they often use credit cards to cover the costs. This only adds more debt because credit cards come with high-interest rates. Paying off medical bills is tough enough, but when you add in credit card debt, it feels like you’re just sinking deeper. The best way to avoid this spiral is to make a plan before it gets out of control.
How Medical Debt Hurts Your Credit
Having medical debt doesn’t just cause stress; it can also mess with your credit score. If you don’t pay your bills on time, they might get sent to a collections agency, which shows up on your credit report. When this happens, it can lower your credit score, making it harder for you to get loans in the future. Whether you’re trying to buy a car, get a mortgage, or cover another emergency, having medical debt in collections can make things more expensive and difficult.
To protect your financial health, it’s important to stay on top of your medical bills and work out payment plans when needed. Keeping your debt from going into collections can save you a lot of headaches later on.
How to Manage Medical and Credit Card Debt
If you’re dealing with medical debt, there are ways to manage it. First, see if the hospital or doctor’s office will let you make payments over time. Many places offer payment plans with little or no interest, which is way better than using a credit card. Also, try to pay off high-interest debt first—usually your credit cards. Setting up a simple budget that includes your debt payments can help you stay on track and make sure you’re paying down what you owe.
Handling medical and credit card debt can feel like a lot, but there’s help available. Start with small steps, like asking about payment options and making a budget that works for you. If you’re ready to take control of your debt, there are resources out there to guide you. You can get out of debt—you just need a plan to start.
