CHICAGO (WBBM NEWSRADIO) - More of us are putting it on plastic, according to a new report from Equifax that shows Americans had $916 billion in credit card debt last month.
This is the first time since the pandemic we’ve seen that much spending.
Credit card industry senior analyst at Bankrate.com Ted Rossman sees some good news in the 9% increase in balances over a year ago.
He told WBBM the snapshot of statement balances is positive for the economy and consumers who pay off their monthly bill while accruing miles or points.
But for others, the highest interest rates in 30 years could be troublesome.
“The part that is problematic is somebody who’s carrying debt, financing that at an average interest rate that’s approaching 19%,” Rossman said.
Related
He suggested they take advantage of offers of zero percent interest rates for balance transfers to another credit card.
Rossman said he’s surprised such offers are still available. They are not without transfer fees of 3 to 5%, but he said that could still save you plenty in the long run.
This spike comes after an unexpected drop in credit card balances in 2020 when Rossman said consumers spent less or used stimulus checks to pay off debt.
This return to spending is not surprising after the New York Fed last year found the highest jump in credit card balances in some two decades.
“One would be higher interest rates, another one would be inflation, but also you have all this pent up demand, people are traveling, they’re going out to eat, they’re going to concerts and sporting events. A lot of that spending tends to go on credit cards as opposed to other forms of payment,” Rossman said.
Listen to WBBM Newsradio now on Audacy!
Sign up and follow WBBM Newsradio
Facebook | Twitter | Instagram
Related
