As of November of last year (2016), outstanding American debt is over the $14 trillion mark. A large chunk of this debt comes in the form of credit card debt. Did you know that, based off estimates, if you split the total credit card debt among all Americans it would come out to almost $16,000 per person? The total tally of United States credit card debt is currently about $729 billion. As the millennial generation progresses, we’ve seen a decrease in overall credit card ownership. But this decrease does not coincide with a decrease in debt. The bad spending habits of Americans remain the same, if not worse, than they were in generations past.
According to studies, around 174 million Americans own at least one Credit Card. These days its almost required to have at least one credit card to be able to make some of the more major purchases in life. Having a credit card allows you to build up your score which will then help you with some of the following big life moments:
Various studies show that baby boomers are the biggest users of credit cards owning an average of almost 3 cards per person. Interestingly enough, adults with an annual income of over $75k are also some of the largest users of credit cards. In addition, the more recent the generation, the less credit cards are used. Almost as if newer generations are “shunning” credit cards for what they have done to generations before them.
Total credit card debt has actually been steadily decreasing over the last 8 years. Despite this, the average American household owes almost $17,000 in credit card debt. It’s easy to see how one could be overwhelmed with trying to attack their debt problems when it is clearly a HUGE problem for people. A lot about credit card debt is covered in a fantastic documentary called “In Debt We Trust”, which can be watched for free on youtube:
An extremely important subject to think about if you are carrying significant debt is how much you should be paying down monthly. Many Americans think it is okay to just pay the minimum balance on their credit cards. While this allows you to continue with your comfortable lifestyle, this is also the fastest way to dig yourself into a financial ruin. Continuing to pay only the minimum will eventually have you not even paying off the interest you accrued against yourself each month which will lead to debt growing until you break the habit. Try out Credit.com’s Credit Card Payoff Calculator to figure out how much you need to be paying in order to pay of your card in the time frame you would like to set for yourself.
When it comes to getting in front of your debt, you should come at it with everything you have! These are some great tips for attacking your debt:
Did you know that you can actually negotiate with lenders to reduce or forgive some of your unpaid debt? You can actually get negative marks on your credit report for things like missed payments removed if you go through the proper channels. While you can certainly attempt to do this on your own, the easiest way is to consult with a professional who does this kind of thing on a day to day basis for clients. There are credit repair companies that are entirely dedicated helping you revive your credit score through numerous methods.
These agencies will typically handle all of the stressful parts of negotiating with lenders and will help you get started on the road to financial independence and freedom. Outsourcing these tasks to a reputable company, such as Lexington Law, can help you to put your mind at ease while you keep up with your normal daily routines. They will also provide you with status reports every step of the way so you can feel as involved as you’d like to be.
If you’re one of the brave folks who wants to attack the problem on your own, then these tips can help you get the job done:
Don’t let credit card debt consume you. Credit Cards can be one of the most useful tools in life and, if used right, can even make you money through credit card rewards. Use the tips in this article to pay off your debt, and then learn how to make credit cards work for you!