What effect does debt have on an individual’s financial health?

Debt significantly affects an individual’s financial health by increasing financial stress. When individuals incur debt, they usually have to allocate a portion of their income to meet monthly payments, which can limit their ability to save or invest. The burden of repayment, especially if the debt grows due to high interest rates or additional borrowing, can create anxiety and worry about financial stability. This stress may affect not only their financial decisions but also their overall well-being and mental health.

The presence of debt often forces individuals into a position where they must prioritize immediate financial obligations over long-term financial planning and security. This constant pressure can lead to a cycle of financial struggle, making it more difficult to achieve financial goals and feel secure in one’s financial health.

The other options suggest positive outcomes associated with debt, but it is essential to recognize that, in general, debt carries significant risks that can lead to considerable stress rather than beneficial results.