As the Federal Reserve has raised rates to fight inflation, the increasing number of Americans who carry credit card debt from month to month are paying more interest.
He’s not alone: 46% of people are carrying debt from month to month, up from 39% a year ago, according to Bankrate.com, an online financial information site.
Roughly 4 in 10 adults in households making under $100,000 a year say their debt is up, compared with about a quarter in households making more than that. About half of Black and Hispanic adults say their household debt has increased, compared with about 3 in 10 white adults. During the early pandemic, credit card debt dipped 17%, Bankrate said — thanks in part to stimulus programs, emergency relief, and a decrease in consumer spending.But in the last three months of 2022, credit card balances in the U.S. increased $61 billion to $986 billion, surpassing the pre-pandemic high of $927 billion, according to the Federal Reserve Bank of New York.can provide protections for people who can pay off the balance every month. But the cost for those who can’t is high.
Now retired and on Social Security, Deuvall and his wife still have some credit card debt, he said, “in the five figures,” but they’ve also transferred that balance to a zero percent interest card to help contend with high rates.Zero percent interest offers are generally available only for a limited period, sometimes up to 21 months, and banks sometimes charge a flat fee, such as 3% of the balance transferred.
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