Consumer Smarts and the Average Credit Card Debt
How you compare to the average credit card debt -- and how you can keep from sinking any deeper.
If you wonder about average credit card debt, some of the statistics might shock you. The average credit card debt in America is both larger and lesser than it seems. The simple fact is, though, that with the economic downturn the financial stress on most families has seriously increased. Consider that:
-- The average credit card purchase ends up costing 12% more than it would if you'd bought it outright
-- 40% of American families spend more than they earn
-- If you only made the minimum payments, then a $1,000 charge on an average credit card would take approximately twenty years to pay off and cost you well over $2,000 in interest.
-- The average interest paid -- just on credit card debt -- by Americans is $1,200 annually.
-- When people pay with credit cards in restaurants, they're proven to spend more than when they pay in cash or with debit cards.
These are just a few facts illuminating the danger of the average credit card debt. Credit cards are important parts of life, and we need them to establish our credit ratings. However, they can also become incredibly dangerous.
Tips to control and pay off credit card debt
If you don't want to become one of the roughly 2 million households filing for bankruptcy every year, there are tips you can use to control and pay off your credit card debt. Don't worry about what the average credit card debt comes out to; worry about what YOU can afford and pay off.
-- Carry only a small balance on your credit card. If you must use it for emergencies, make every effort to pay off the extra purchase as quickly as possible.
-- Plan when you will and won't use your credit card. It's much easier to spend money you don't have with a credit card in hand.
-- Consider consolidating loans if repayment has become a problem.
We worry a lot about the average credit card debt in America, but if you're serious about financial responsibility, focus on your own debt instead of someone else's.
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