DORAL, FL – Credit card debt is currently experiencing an increase not seen before according to several sources such as the AP and Bankrate.com
Bankrate.com, an online financial information site, revealed 46% of people are carrying debt from month to month, up from 39% a year ago.
In addition, the finances website states the average credit card interest rate, or annual percentage rate, has reached 20.4% — the highest since their tracking began in the mid-1980s.
Individuals are not only accumulating more credit card debt than before but also falling behind on payments, said the Bankrate analyst Greg McBride to the Associated Press.
Meanwhile, the Associated Press-NORC Center for Public Affairs Research conducted a poll through which 35% of U.S. adults reported that their household debt is higher than it was a year ago. Just 17% say it has decreased.
Also, the poll revealed roughly 4 in 10 adults in households earning under $100,000 a year say their debt is up, compared with about a quarter in households surpassing that amount.
These findings match with that of the Federal Reserve Bank of New York according to which in the last three months of 2022, credit card balances in the U.S. increased $61 billion to $986 billion, going beyond the pre-pandemic high of $927 billion.
This scenario has been fueled by the interest rates that continue to go up in an effort to put a stop to the inflation. Nevertheless, the decisions made by the Federal Reserve have conducted to higher annual percentage rates (APRs) for consumers that to make end meets rely more and more in their credit cards.
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