Credit card usage surges in US as consumers struggle to pay for food, utilities

Video above: Major credit card mistakes to avoid when times are tough In the last year, credit card debt jumped by $ 100 billion – a 13% increase – which is the largest in more than 20 years. Experts say any relief for consumers might be months away. Credit card usage is up as household debt surpasses $ 16 trillion for the first time ever during the second quarter. “It’s because many consumers are being stressed and pressed to pay for the necessities of food, fuel,” said Marshall Rowe, chief innovation officer for Colony Group. Inflation is cutting into the wallets of many Americans. Findings from a Lending Club report show close to two-thirds of the US population is living paycheck-to-paycheck, causing debt data to soar. Video above: Fed interest rate hike will make credit card debt more expensive “Credit card debt in my opinion is probably the worst kind of debt you could have. It’s unsecured debt. The credit card companies have nothing to secure that debt against, “said Sean Tole, a financial advisor. A recent study by the National Bureau of Economic Research finds that between 9 and 20% of credit card customers choose to pay the minimum amount even if they can afford to pay more. Experts say just getting by with that minimum each month isn’t enough. “It’s almost impossible to almost ever pay it off,” Tole said. “You’re going to be paying that minimum payment for a very long time and you really need to start paying more than that minimum amount because you’re really going to be spending a lot of money on those finance charges over the long run. “Experts say consumers with outstanding credit card debt will likely start to see the impact of hiked interest rates soon, and they don’t anticipate it to let up even heading into the holiday season.

Video above: Major credit card mistakes to avoid when times are tough

In the last year, credit card debt jumped by $ 100 billion – a 13% increase – which is the largest in more than 20 years.

Experts say any relief for consumers might be months away.

Credit card usage is up as household debt surpasses $ 16 trillion for the first time ever during the second quarter.

“It’s because many consumers are being stressed and pressed to pay for the necessities of food, fuel,” said Marshall Rowe, chief innovation officer for Colony Group.

Inflation is cutting into the wallets of many Americans.

Findings from a Lending Club report show close to two-thirds of the US population is living paycheck-to-paycheck, causing debt data to soar.

Video above: Fed interest rate hike will make credit card debt more expensive

“Credit card debt in my opinion is probably the worst kind of debt you could have. It’s unsecured debt. The credit card companies have nothing to secure that debt against, ”said Sean Tole, a financial advisor.

A recent study by the National Bureau of Economic Research finds that between 9 and 20% of credit card customers choose to pay the minimum amount even if they can afford to pay more.

Experts say just getting by with that minimum each month isn’t enough.

“It’s almost impossible to almost ever pay it off,” Tole said. “You’re going to be paying that minimum payment for a very long time and you really need to start paying more than that minimum amount because you’re really going to be spending a lot of money on those finance charges over the long run. “

Experts say consumers with outstanding credit card debt will likely start to see the impact of hiked interest rates soon, and they don’t anticipate it to let up even heading into the holiday season.

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