THE BLOG

Six Signs You May Have Too Much Debt

03/05/2012 12:16 pm ET | Updated May 05, 2012

We all carry some form of debt. Whether it be a mortgage, car note or student loans. Where you may run into trouble is when your debt starts to overwhelm and this can happen long before the bill collectors start calling.

Here are few signs that you may be carrying too much debt:

1.) You are constantly using overdraft protection or your bank account is frequently in a negative status.

2.) You have no savings or emergency fund. This is a precarious financial state to be in. A State Farm study found that more than half of Americans do not have a financial back-up plan. If an emergency of any kind were to happen, you would not be financially prepared to handle it. So if when you get paid, you pay all of your bills, and nothing is left for savings, this a big indicator that you are carrying too much debt.

3.) You have no discretionary income. You have no cash left for basic extras -- a movie now and then or ordering take out. If all you can do is work and pay bills, then your debt load is too much.

4.) You've taken out a payday loan. Many are trying to legitimize these transactions, even mainstream banks, but the bottom line is these transactions are nothing more than a financial hole you dig for yourself. Between the ridiculously high interest rates and the fact that this just creates another bill that is due, a payday loan is just a life raft with a hole in it.

5.) Pulling from Peter to pay Paul. If you are paying one credit card bill with money from another credit card or using a home equity line to pay off debt, then you are having a financial issue that shows you are over your limit.

6.) You pay your bills late because you don't have money. If you are always running behind simply because you don't have the money to meet your obligations, then you are overextended and really need to assess your financial situation.

If you have found yourself in any of these situations, I would advise you to get financial counseling, make a habit of developing a budget and decide where you can immediately cut debt and what will take a more long-term solution.

Jennifer Streaks -- Continue the conversation, follow me on @jstreaks