As we begin a New Year, many people look back to what happened over the course of last year. When considering a major source of consumer Debt for Americans, Credit card debt, 2017 saw a dramatic increase in credit card spending. As of October 2017, the Federal Reserve announces that the average credit card debt per U.S. household was $8,308, which surmounts to a whopping $1.011 trillion in total credit card debt. This surpasses the previous record set in April 2008 and is the highest amount of credit card debt Americans have ever seen. So will the trend continue or will 2018 see a drop in the amount of consumer debt that Americans are carrying?
Credit Card Debt Facts
- Here are a few things you should know about credit card debt in the U.S.:
- 70% of Americans were reported to have at least one credit card.
- Of the individuals that have a credit card, 38% reported that they are currently carrying a balance on their credit card.
- The average household pays a total of $904 in interest on their unsecured, revolving credit per year.
- Four major spending categories have outpaced income growth over the last 10 years and they are medical expenses, food and beverages, housing, and “other expenses”.
- More retailers and businesses are expected to launch their own credit cards in 2018.
Paying Down Credit Card Debt
The best possible way to tackle credit card debt is to make more than your minimum monthly payment each month. If you are only making the minimum payment, interest continues to acquire and creates a situation where you are never able to get your balance back down to zero. Another way to pay down your debt is to try the no credit card for 30 days challenge. This works well for people who have a habit of spending on everyday items using their credit card. Instead of pulling out the plastic, take out enough cash to match your budget for everyday expenditures such as gas, food, etc. This will not only draw more attention to how much you spend but once it’s gone you can’t spend money you don’t have. This plan also works two-fold as it prevents you from accruing additional credit card debt.
If you aren’t able to begin 2018 on solid financial footing consult with an Auburn bankruptcy lawyer about your debt problems. We can help you develop a strategy for getting back on track.
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