It may not be you; it might be the person to your left or right who expect their credit card to fail. CNBC reports on a recent WalletHub survey that claims 1 out of 3 people are afraid the will max out their credit card when making a $100 purchase.
That is a bit concerning, and illustrates how the feeble the US houshold budget is. Some other comments worth mentioning:
- For example, men were 15 percent more likely than women to have maxed out a card, as were millennials when compared with older generations, particularly boomers.
- At the same time, credit card interest rates have never been higher, setting the stage for potential problems for those at-risk consumers.
- The average card interest rate is currently at a record 17.41 percent, according to CreditCards.com’s latest report. That’s up from 16.15 percent one year earlier and 15.22 percent two years ago.
Some interesting factoids from their infographic:
- 43% of those surveyed have been paying off their credit card balance for 2+ years
- Average Household credit card debt: $16,883
- Amount each household pays in interest each year: $1,292
- Average cost to transfer a $5,000 balance over 24 months: $326
Credit cards are perfect products for supplementing household needs, but they were never intended to be free. Sure, they can be tempting, but it is easy to rack up charges.
Watch for Mercator Advisory Group’s upcoming Credit Card Data Book, which is currently in the editing process. In the meantime, take a look at the newly published 2019 Outlook for U.S. Payments authored by Mercator’s head of research, Aaron McPherson.
Overview by Brian Riley, Director, Credit Advisory Service at Mercator Advisory Group