Credit card debt is a major problem for many Americans. Almost half of all Americans currently carry a balance on their credit cards, but the problem is, most of them are not able to pay off the balance. In fact, 70 percent of cardholders say they cannot pay off the balance within one year.
These figures come from a survey released by real estate data company, Clever. They surveyed 1,000 credit card users regarding their credit card use. The study found that 47 percent of all Americans carry a monthly balance on their credit cards. On top of that, 70 percent of those surveyed say that their card balance is more than $1,000.
Additionally, 56 percent of those surveyed said that they have had their credit card debt for at least one year. Of those surveyed, 20 percent of them say they believe it will take them over three years to pay off the debt. Eight percent of them admit that they do not know when they will be able to pay off the debt.
Depending on how high the balance is, the interest rate on the card can make it virtually impossible to ever make progress on the debt. The average credit card APR currently is 17.65 percent. If a cardholder is only making the minimum monthly payment, he or she is likely only paying on the interest for the card.
Credit card debt has hit an all-time high, according to data from the Federal Reserve. As of December 2018, U.S. credit card debt was estimated at $870 billion, which is the highest it has ever been. Credit card balances were also said to have increased by $26 billion from the prior quarter, which is another notable increase.
What seems to be making this problem worse is the fact that Americans rely heavily upon debt to cover everyday expenses. Even something as simple as buying groceries or paying for gas for their cars can add up if charged on a credit card. In fact, the Clever survey reported that 28 percent of them say that they rely on credit cards to pay for their essential living expenses.
It is no secret that credit card usage has gone up in recent years. It is estimated that currently 480 million credit cards are in circulation nationwide. As bankruptcy attorneys, we see credit card debt as one of the most common problems facing those with serious financial challenges. It is not surprising with the high interest rates, unreasonable fees, harassing debt collection calls, penalties and never-ending minimum payments that do not even make a dent in your actual debt. We offer additional tips for eliminating credit card debt on our blog.
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If you have questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.