• Investing
  • Stock
Round Table Thoughts
  • Economy
  • Editor’s Pick
Home Editor's Pick Average credit card balances jump 10% to a record $6,360 as more consumers fall behind on payments
Editor's Pick

Average credit card balances jump 10% to a record $6,360 as more consumers fall behind on payments

by February 9, 2024
by February 9, 2024 0 comment
Share
0
FacebookTwitterPinterestWhatsapp

Credit card debt has notched another new high.

Americans now owe $1.08 trillion on their credit cards, the Federal Reserve Bank of New York reported Tuesday.

Balances jumped 10% from a year ago, according to a separate quarterly credit industry insights report from TransUnion, with the average balance per consumer hitting $6,360, also a historic record.

“Consumers are just spending more,” said Charlie Wise, senior vice president of global research and consulting at TransUnion. “Even though the inflation rate is down, that doesn’t mean prices are coming down.”

To be sure, prices are still rising, albeit at a slower pace than they had been.

The consumer price index — a key inflation barometer — has fallen gradually from a 9.1% pandemic-era peak in June 2022 to 3.4% in December 2023.

Meanwhile, households continue to show signs of strain — more cardholders are carrying debt from month to month or falling behind on payments.

Credit card delinquency rates jumped across the board, the New York Fed and TransUnion found. Credit card delinquencies surged more than 50% in 2023, the New York Fed reported. According to TransUnion’s research, “serious delinquencies,” or those 90 days or more past due, reached the highest level since 2009.

“Consumers are struggling with their payments,” Wise said, and “I think we will continue to see those delinquencies tick up.”

“It’s not all bad news,” said Ted Rossman, Bankrate’s senior industry analyst. Cardholders who pay their bill in full every month reap the benefits of cash back and travel rewards without paying interest.

“The big fork in the road is whether or not you carry a balance,” he said.

In that case, credit cards are one of the most expensive ways to borrow money. The average credit card charges a record-high 20.74%, according to Bankrate.

At more than 20%, if you made minimum payments toward this average credit card balance, it would take you more than 17 years to pay off the debt and cost you more than $9,000 in interest, Rossman calculated.

Still, consumers often turn to credit cards, in part because they are more accessible than other types of loans.

Overall, an additional 20.1 million new credit accounts were opened in the fourth quarter of 2023, boosted in part by subprime borrowers looking for additional liquidity, according to Wise. Subprime generally refers to those with a credit score of 600 or below, according to TransUnion. 

Many people in this group are millennials, he said, who are burdened by high levels of student loan debt and the housing affordability crisis.

“If you can’t afford to buy and your rent keeps going up, that’s not a very happy set of circumstances,” Wise said.

“My favorite tip is to sign up for a 0% balance transfer credit card,” Rossman said.

Cards offering 12, 15 or even 21 months with no interest on transferred balances are out there, he added, and “these allow you to consolidate your high-cost debt onto a new card that won’t charge interest for up to 21 months, in some cases.”

Borrowers may also be able to refinance into a lower-interest personal loan. Those rates have climbed recently, as well, but at just under 12%, on average, are still well below what you currently have on your credit card.

Otherwise, ask your card issuer for a lower annual percentage rate. In fact, 76% of people who asked for a lower interest rate on their credit card in the past year got one, according to a LendingTree report.

This post appeared first on NBC NEWS
You Might Also Like
  • Nike expects more sales declines as it attempts a comeback
  • Credit Suisse to borrow up to nearly $54 billion from Swiss National Bank
  • Roomba-maker iRobot announces it’s laying off 31% of employees after Amazon deal falls through
  • UAW autoworkers officially ratified new contract, union says
Share
0
FacebookTwitterPinterestWhatsapp

previous post
Biden considered resigning vice presidency ‘in protest’ over Obama’s Afghanistan policy: Hur report
next post
Biden challenger Phillips says special counsel report ‘affirms’ Biden ‘cannot continue to serve’: ‘Sad day’

You may also like

Sam Altman rejoins OpenAI board of directors, months after removal

March 9, 2024

OpenAI releases Sora, its buzzy AI video-generation tool

December 10, 2024

McDonald’s reportedly temporarily shuts its U.S. corporate offices ahead of...

April 3, 2023

Want to bet against Trump Media stock? It’ll cost you

April 6, 2024

United Airlines CEO responds to string of safety incidents that...

March 21, 2024

Biden to launch task force to crack down on ‘unfair...

March 7, 2024

Valentine’s Day spending on significant others is expected to hit...

January 30, 2024

DeepSeek hit with large-scale cyberattack, says it’s limiting registrations

January 28, 2025

USDA documented insects and slime at Boar’s Head plants, records...

January 15, 2025

IoT connections and revenue will grow at a steady pace...

February 28, 2023

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • How to Find Compelling Charts in Every Sector

      July 10, 2025
    • White House accuses Powell of mismanaging Federal Reserve, citing headquarters renovation

      July 10, 2025
    • Italian chocolate giant Ferrero to buy Kellogg’s Froot Loops maker

      July 10, 2025
    • OpenAI to release web browser in challenge to Google Chrome

      July 10, 2025
    • Sports executive charged with bid-rigging in Texas arena project

      July 10, 2025

    Popular Posts

    • 1

      Biden appointee played key role in recruiting Chinese...

      June 25, 2024 3,631 views
    • 2

      Trump-era China sanctions ended by Biden may be...

      June 27, 2024 2,919 views
    • 3

      Walz’s honeymoon with China gets fresh scrutiny as...

      August 9, 2024 2,607 views
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful...

      July 10, 2024 2,577 views
    • 5

      Harris VP pick spent years promoting research facility...

      August 29, 2024 2,450 views

    Categories

    • Economy (7,009)
    • Editor's Pick (2,171)
    • Investing (538)
    • Stock (2,662)

    Popular Posts

    • 1

      Biden appointee played key role in recruiting Chinese businesses to Delaware: ‘Longtime friends’

      June 25, 2024
    • 2

      Trump-era China sanctions ended by Biden may be revived under new House GOP bill

      June 27, 2024
    • 3

      Walz’s honeymoon with China gets fresh scrutiny as Harris camp blasts ‘lying’ critics

      August 9, 2024
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful of Chinese spy threats

      July 10, 2024
    • 5

      Harris VP pick spent years promoting research facility that collaborated with ‘Chinese military company’

      August 29, 2024

    Latest News

    • How to Find Compelling Charts in Every Sector

      July 10, 2025
    • White House accuses Powell of mismanaging Federal Reserve, citing headquarters...

      July 10, 2025
    • Italian chocolate giant Ferrero to buy Kellogg’s Froot Loops maker

      July 10, 2025

    Categories

    • Economy (7,009)
    • Editor's Pick (2,171)
    • Investing (538)
    • Stock (2,662)

    Disclaimer: RoundTableThoughts.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 RoundTableThoughts.com. All Rights Reserved.

    Round Table Thoughts
    • Investing
    • Stock
    Round Table Thoughts
    • Economy
    • Editor’s Pick

    Read alsox

    31 percent of all IoT SIMs...

    December 25, 2022

    Microsoft to lay off more employees...

    July 11, 2023

    Fed Chair Powell says holding rates...

    July 11, 2024
    Sign In

    Keep me signed in until I sign out

    Forgot your password?

    Password Recovery

    A new password will be emailed to you.

    Have received a new password? Login here