As Americans face increasing amounts of debt, their ability to retire comfortably is coming more into question.

“Our research has shown that 78% of people are living paycheck to paycheck,” financial expert Chris Hogan said on Yahoo Finance’s On the Move (video above). “That means if one check doesn’t show up, they don’t have enough to really make basic needs met month in and month out. So we need a wake-up call all the way around, and people need to engage in this and get more serious.”

Hogan added that he doesn’t think “people understand that it’s really important for us to make sure that we’re putting money away and saving because if we don’t save some money, we won’t have any to spend later.”

‘I really want to encourage college students to avoid this trap’

According to a recent survey conducted by Freedom Debt Relief, 41% of Americans have not set aside any money at all for retirement. The main reason indicated was due to the cost of everyday expenses.

Debt was also another impediment to saving adequately. About 79% of those surveyed said they have debt: Credit card debt accounted for 46%, mortgage debt 41%, and auto loan debt 28%.

“Having fallen into that trap myself and taken a few years to get out of it, I really want to encourage college students to avoid this trap,” Hogan said. “Credit card debt is something that once they get their hooks into you, this can take you 12 to 15 years if you’re not aware of it to attack it and get it out of your life. So, I want people to understand credit.”

‘Any kind of debt is a threat to your future’

Yahoo Finance previously reported how 25% of Americans surveyed in December 2018 expect to die in debt. Additionally, 41% of people don’t know when they’ll pay off what they owe, and 65% of adults with debt don’t know when or if they’ll get out of it.

“Any kind of debt is a threat to your future, right?” Hogan said. “Whenever we borrow someone else’s money, we’re charge a penalty called ‘interest.’ And so, helping young people understand how money works is absolutely essential. … Knowledge is absolutely crucial to be able to help young people avoid this trap down the road.”

Household debt recently reached $13.67 trillion, which is $993 billion higher than the peak of $12.68 trillion in the third quarter of 2008.

The best way to avoid personal debt? Budgeting, which Hogan described as “absolutely a crucial life skill.”

“It’s going to help you have more control over your money than you ever thought possible,” he said. “There’s a statement out there that you can either tell money where to go or wonder where it went. And if you’re not budgeting, that’s what ends up happening. Money is leaving you, and you don’t know what’s going on.”