Credit card debt in the U.S. has reached a high of $830 billion, making a six percent jump since last year. Next to personal loans, credit card debt is the second-fastest growing category of debt, according to a recent Experian report. It is reported that the average American consumer carries a balance of $6,200 on his or her credit card. With balances that high, it can be quite difficult for the average consumer to pay off his or her debt.
It turns out that the consumers who are carrying the most credit card debt are those with a net worth of over $100,000 or more, according to a recent study from Bankrate. Adults who carried net worth between $100,000 and $199,999 are the most likely to carry credit card debt, followed by individuals with net worth between $200,000 and $1 million. People who had a net worth over $1 million had the least amount of credit card debt.
According to financial experts, the reason for this high debt load has to do with societal pressures. Another factor playing into this is the fact that while household income has grown over the past ten years, it has not grown along with the cost of living. It is for this reason that many Americans are relying on credit cards to pay their daily expenses.
The Bankrate study reported that individuals who had a net worth of more than $100,000 owed at least $2,500 in credit card debt. Of these cardholders, 39 percent owed at least $5,000. Taking these balances and only making minimum monthly payments, it could take someone over 20 years to pay off a $5,000 credit card balance.
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.
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.
CNBC – Credit Card Debt is Worse for Those with High Income