Defending the Merits Of Debt And Cholesterol

Why It Matters:

• There are benefits to debt and cholesterol

• HDL cholesterol can negate the impact of bad LDL cholesterol

• Student loans and mortgages can be beneficial in the long run

Aaron Lopez tkc.profilePicture Written by: Aaron Lopez | Transamerica
April 30, 2019

4 Min readClock Icon

Debt and cholesterol could use some help from a PR firm. There tends to be a lot of negative publicity surrounding both.

In some cases, the bad press is warranted. Elevated cholesterol can signal poor health and lead to higher medical costs down the road, while mountains of high-interest credit card debt can cause stress and contribute to more health problems.

Bad Cholesterol GraphicBut there’s a positive spin to both debt and cholesterol, and having credible information about these two seemingly unrelated things can impact your pocketbook and your health.

High-density lipoprotein (HDL) cholesterol is known as “good” cholesterol because it helps remove low-density lipoprotein (LDL) cholesterol from the arteries. According to the American Heart Association, a healthy level of HDL cholesterol can help protect against heart attacks and stroke.

While bad cholesterol can clog the arteries, bad debt can clog your finances. Credit cards and auto loans accounted for $1.9 trillion in consumer debt at the end of 2016, according to the Federal Reserve Bank of New York. Outstanding auto loan debt is at a record high, while credit-card debt is at its highest since the end of 2009.

To put the numbers in perspective, households with credit card debt average a $16,748 balance, while households with auto loans average a $28,948 balance, according to an analysis by

Since most cars and trucks depreciate from the moment you drive off the lot, auto loans don’t provide much value as you pay roughly 4.5% in interest over three to five years. With annual percentage rates (APRs) ranging from 15% to 20%, credit cards are even worse when the balance isn’t paid in full every month.

On the flip side, mortgage debt and student loan debt are the HDL that can be beneficial to your financial arteries. They typically carry lower APRs and go toward purchasing something of value, be it a house or a diploma.

Housing prices vary from city to city, but the median U.S. home value has increased significantly over past 30 years. Yes, borrowing $200,000 to pay back over a 15- or 30-year period can seem daunting, but homeowners can build equity that be invaluable as they pay down their mortgage.

The same can be said for higher education. Though tuition rates have doubled in the past 20 years, there’s plenty of value in earning a college degree. A recent study by the Georgetown Center on Education and the Workforce found that 75% of all jobs created since the Great Recession have gone to workers with a bachelor’s degree or higher.

During a commencement speech in December, Federal Reserve chair Janet Yellen told graduates  workers with a college degree earned an average of 70% more than those without a degree.

“Economists are not certain about many things,” Yellen said. “But we are quite certain that a college diploma or an advanced degree is key to economic success.”

Yellen didn’t mention anything about the benefits of HDL cholesterol. Maybe she’s saving that for the graduating class of 2019.

Things to Consider:

  • Don’t assume all types of debt and cholesterol are created equal.
  • Monitor your cholesterol levels in the same way you track your debt balances.
  • Pay off high-interest debt from credit cards and auto loans before balances on low-interest loans and mortgages.



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