According to a new report by NerdWallet the average U.S. household with debt carried $15,355 in credit card debt and $129,579 in total debt in 2015. The study, which was based on U.S. Federal Reserve and Census Bureau data and included surveys of 2,000 U.S. adults, further found that most American don’t want to share the fact that they are in debt.  Neither excessive debt nor efforts to hide it should be considered good to those seeking security clearance.

Financial issues were the biggest cause of clearance denial in 2015, resulting in more than double the amount of denials than any other adjudicative criteria. Last year the Defense Office of Hearing and Appeals (DOHA) Board held 996 hearings on appeals related to clearance denials, and the highest issue was financial. Guideline F: Financial Considerations accounted for 499 of those cases.

Excessive debt is considered a major problem because it could put an individual in a compromising situation, and this is why adjudicators take it very seriously.

“Those with significant debt could sell everything they own: their house, their possessions and still need to dig out,” said Christopher Burgess, CEO of Prevendra, a firm specializing in privacy and intelligence. “After everything what else is left? That could be the knowledge and information they have, and that is why debt remains a major red flag to adjudicators.

“If a person has been adjudicated and shows no means to get out of debt there is little chance that individual is going to get any level of security clearance,” Burgess added. “People will do odd things when they are significantly in debt and that includes breaking trust. With that in mind an adjudicator will therefore look at other candidates – why should they take a chance when they don’t have to?”

Types of Debt and Clearance

It isn’t often just debt that is looked at, because as noted a rather large portion of the country owes money in some way. Moreover, it isn’t always the amount of the debt that is considered but how one acquired it. There can be the debt that comes from irresponsible activities: drinking, partying, gambling or just spending beyond one’s means; and then there is debt that comes about because of hardships and other unfortunate things one cannot control, such as an illness or accident.

“It can definitely be looked at differently based on certain situations,” said La Tonya Camera Walker, director of recruiting for Adecco Government. “There are those circumstances that are not under your control, such as medical bills, and that is different from just spending too much money.”

However, it may depend on the level of clearance – the higher clearance the more closely one’s debt may be considered and the more one should have the house in order when applying for clearance. It also comes down to what the adjudicator sees or thinks there is to see.

“I’ve seen individuals who had financial difficulties due to an illness in a family, where the savings were wiped out because someone got sick; and another who just overspent,” said Burgess. “You’d think the adjudicator would look at these differently but that wasn’t the case. If you are truly financially upside down regardless of the background you could have a problem.”

First Step: Get It Under Control

Whatever the reason for the debt, there are a number of things one should do when debt could be a major red flag prior to a clearance review. The first thing is to understand why you have the debt and then getting it under control.

“A recent graduate may come out of college with $80k in student loans, $5,000 in credit card and car loans and suddenly that is a lot of debt, but if that person is making payments that is the right direction,” said Gregory F. Greiner, senior counsel at the Tully Rinckey law firm specializing in cases involving security clearance. “I’ve never seen the DoD raise concerns about the amount of debt, but the issue arises when you don’t pay your bills, when you default on your loans. If you don’t pay, or can’t pay, then it becomes a problem.”

Ignoring the problem in other words won’t make it go away. Getting the house in order is very important, and the answer should never be that this next job will ensure the debt is handled. Progress needs to be made well before that point. More importantly spending should be curbed where possible so the debt isn’t going up.

“If you are doing irresponsible things like spending too much money by going out all the time you need to stop,” warned Sarah St. Clair, Booz Allen Hamilton vice president overseeing human resource services. “Stop doing the bad things.”

Once the spending is stopped the most important thing to do is to pay debt down. Effort to pay off debt can go a long way.

“We like to see that people have made progress with debt; not only that it is under control but that effort is made to reduce it significantly,” added St. Clair. “All debt can be important, but old debt that lingers will matter more. We also don’t like to see patterns where people get out of debt and then back into it.”

Second Step: Get Help if Necessary

Some problems can’t be handled alone and sometimes it is a matter of better budgeting, while other times it can be consolidating debt. In either case there are organizations that can help.

“Anyway you can get things in order and show that you are working on payment arrangements will help when you are working on clearance applications if debt is an issue,” said Walker.

Many communities have non-profit groups that aid in debt consolidation, and this may include local colleges and universities that offer these services pro bono.

“If you haven’t found a legit resource to help with debt then you haven’t looked hard enough,” said Burgess. “It also comes down to analyzing your life and how you spend money. Your whole lifestyle should be looked at closely, including how you ended up in debt.”

Final Step: Don’t Hide It

Once the debt is under control, and even being paid down, the next best thing is not to hide it when the times comes to get a clearance review. As noted by the NerdWallet report Americans have a lot of debt and while they may not like to talk about it, debt isn’t actually a well kept secret by any means.

When undergoing a clearance review know that debt will be discovered and then the problem is only made worse.

“You have to be honest about everything,” said Walker. “When you’re in the clearance office you have to be honest because they will find out everything anyway, and by trying to hide debt you could make it look like you have more to hide.”

It is better that debt is brought to light by the individual seeking clearance rather than by its being discovered through credit reports, or worse from a reference or other individual noting it.

Credit reports shouldn’t be an afterthought either. These should be considered crucial for anyone seeking or keeping security clearance. So don’t wait for someone to run a check on you; instead you should have a clear idea what they’re going to find.

“Even more than when it comes to buying a house know your credit score,” suggested St. Clair. “Get those reports on a routine basis, so that when things pop up you can manage them responsibly. You should know your credit score before you get clearance, but then watch it afterward, because if you’re asked why your debt is a problem at any point it is probably too late.”

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Peter Suciu is a freelance writer who covers business technology and cyber security. He currently lives in Michigan and can be reached at You can follow him on Twitter: @PeterSuciu.