Survey of Consumer Finance collected data of credit card debt in order to know average amount of debt each household. Data showed that the debt is $5,700 per household in 2017. This number is bigger than previous result that only reaches around $5,500 – $5,600. Another study showed different result that’s only at $5,500. Therefore, you know the answer when asking about how much credit card debt does the average American have.
Spending, Income, Cost, and Debt
Credit card is a common way to pay anything. You can buy at merchant easily without preparing cash. Digital era brings online store into prominent day to fulfill what consumer wants. They use credit card for financial transaction via online. It is simple, easy, and secure with less time to process until the transaction is done. This is why credit card becomes popular for old to young generation.
In general, credit card owner increase twice, but the percentage is lower. In early 1960s, half of household became credit card owners. This condition turned into different situation few years ago due to economic growth and change in financial level. Some people still balance spending and income that do not need credit card. Other still relies on it to purchase products. Amount of credit card debt in U.S is only for cardholder or owner.
Several factors play important role for increasing credit card spending. The fact of how much credit card debt does the average American have cannot ignore the spending and income status. They have big debt because they use credit card for unnecessary spending. For example, they pay medical expense or any emergency cost using this card.
Besides, they take cash from credit card from merchant. It is not much recommended for credit card owner. Moreover, you pay things that should be able to cover by regular income. Instead of paying everything via credit card, it will be better to prepare cash then pay directly. Those are the factors why credit card debt rises significantly.
Asking how much credit card debt does the average American have means there is issue to solve immediately. In fact, credit card is available because people cannot rely on traditional paying method. As we know, debit card limits the paying capability because it only uses money at saving. On contrary, bank or Credit Card Company lends money to pay anything then charge with interest to pay regularly.
Moreover, credit card debt in average American increases because higher interest. Today, people cannot live without being in debt, unless you have enough money to purchase everything. Credit card is only one thing related to loan. You have to include mortgage, student loan, car loan, etc. Those debts are separated from debit card, but be careful when deciding to consolidate. You need to use income for those debts, but avoid using credit card to pay the other loans.
Well, the debt is varied in each states and Alaska is the highest at all with the debt more than $10,000. For your information, people with age between 40 and 54 have higher debt than the younger generation. From this information, you now understand how much credit card debt does the average American have.