According to statistical records, the total American public debt was an astounding $28.91 trillion in November 2021, about $1.46 million more than the previous year. As we kick-start 2022, this trend is expected to continue.
The COVID-19 pandemic wreaked havoc on people’s physical health, mental health, and financial standing. Leading to a steep economic downturn, the pandemic pushed the nation into one financial pitfall after the other.
Massive swaths of the economy were affected across almost every sector. Businesses either shut down or significantly slowed down. Unemployment and financial losses increased significantly across the nation.
How did these changes affect how Americans paid off their debt last year? And how will this trend continue or perhaps further crystallize in 2022? Continue reading to find out.
1. The Rise in Debt
The pandemic led to a significant increase in debt. Owing to extreme financial pressures, people took out bigger loans for a range of different purposes. As debt accumulation increased, the risk of a nationwide financial crisis also skyrocketed. These changes directly affected the way Americans started paying off their debt in 2021 and how they’re continuing to pay off the debt in 2022.
2. Debt Payment
The pandemic pushed the e-commerce industry forward. As the world went digital, many people started setting up online businesses to retain a steady income stream. Everything from goods to groceries to education to services became digitally available for the entire nation to consume.
As a result, debt repayment was also digitized. A fairly new concept, digital debt collection, is expected to become the new norm in the coming years. Not only is it safer, but it’s also significantly more convenient and speedy. The debt collection industry is gradually witnessing a massive digital transformation that will further crystallize and cement as we embrace more digital changes across the nation.
3. How Can I Protect My Financial Standing?
In 2021, there was also an increase in fake and abusive debt collection cases. As people received calls about a debt they didn’t recognize, only a fraction of them took the initiative to validate their debt. By proving that it couldn’t be validated, they could protect their financial standing.
If you think your debt is invalid, work with a team of professionals to protect yourself. If you’re looking for a successful debt dispute program, we can help! At American Debt Enders, we provide unsecured debt validation and debt resolution services to clients across the US. Call us to get started! We also provide free debt counseling by a certified credit counselor.