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New Study Shows Americans Have Positive Outlook on Debt

Large amounts of personal debt can have a damaging effect on an individual's outlook and health. A new study reveals how much debt Americans are carrying and how it's affecting them.

Despite the prevalence of foreclosures and high unemployment rates, Americans appear to have a more optimistic outlook on future economic conditions and debt, according to the 2010 MetLife Study of the American Dream. The results show that most individuals believe their personal financial conditions have "bottomed out," and will only improve over time.

Twenty-six percent of participants expressed their belief that the economy will be worse in the next year - a decline from 44 percent in 2009. Forty-one percent said that there will be no change in over the next year and 33 percent said that the economy will improve. Sixty-six percent said that they believe it will take two or three years for the economy to reach a sustainable level of recovery.

However, Americans were not as optimistic about their personal financial situation, with 41 percent saying they don't expect any improvements will be made. The participants cited instability in the job market as one of their prime concerns - which they are trying to offset with good money management habits.

"For the first time since MetLife polled the Study, Americans perceive their situation to be worse off than that of the U.S. economy in general," MetLife Global Brand and Marketing Services vice president Beth Hirshhorn told MarketWatch. "In fact, many Americans report they continue to dig themselves out of a deep financial hole that they have been in since before the economic downturn."

The study goes on to highlight that Americans are making a notable effort to improve their personal financial situations by saving more, spending less and paying more attention to their finances. This can also be seen in the decline in credit card delinquency and charge-off rates that many lenders are reporting. These trends suggest that Americans are trying to get a handle on their debt and take better care of their credit scores - especially as more individuals try to refinance their homes or obtain loan modifications.

Creating a household budget and getting serious about credit monitoring may help Americans who are uncertain about their financial future feel more at ease and pay down their debt.