What is the average credit card debt in the United States? Before answering to that question, you must know that credit card is the way of life in this country. People utilize it to pay for goods or services with money that they might not have in advance. It can be used to help making mortgage payments or buying stuffs from online merchants. If credit card holder can use their card in responsible manner, it can be very beneficial. However if not, holder can get stuck in debt instead. That can hold them back from creating better financial future.
The Average Credit Card Debt
By the end of 2017, there are approximately 364 million of working credit cards from various issuers. An American has average of two to three credit cards that they utilize regularly. More than sixty percent of people in this country own credit cards. The better one’s credit score is means more chance of opening new credit card account. But many issuers are now promoting credit card for people with poor credit score.
What is the average credit card debt per household? If including those who does not own credit card, balance of every single person in the country is $6,375. However, in average, one household that owns credit card typically has credit card balance of $15,983. This amount is quiet high considering the average income for a household in this country is at $83,143. It is because there are other kinds of debt to be paid off, such as: student loans, mortgage loans, and medical bills.
Being irresponsible when making financial decisions is often accounted as the reason of this whooping average debt. There are many people in this country who spend recklessly, often for things like they do not necessarily need. Eating out and purchasing designer clothing despite not having sufficient income to support such life style is a perfect example for that.
However, there is another reason for debt caused by having credit cards nowadays. So, what is the average credit card debt caused by? Surprisingly, it is mostly caused by regular expenses. Important cost like transportation can take up to 16% of a household’s yearly income. Paying for medical expenses often take a toll financially, especially if there are health emergencies occurring throughout the year. Mortgage payments are also draining family’s financial ability.
The country is driven by consumerism. It is the main engine for its economy prowess. However, this spending habit really hits people, especially middle low class, hard. The debt to income ratio in average has actually decreased. However, as people see, household debt’s nominal is crawling up year by year. It hinders their ability to save up or making investments for better future. Seeking help for financial advisors or even just becoming personally responsible with one’s spending habit is highly encouraged.
You have learned about ‘what is the average credit card debt’ for each household and the reasons triggering that condition. Tackling this issue fast will help turning credit card into a great aid instead of the source of financial disaster.