Skip to main content

Americans Have Now Charged Their Way To More Than $1 Trillion Card Debt

 NEW YORK–Americans now collectively owe more than $1 trillion on credit cards.

According to a new report on household debt from the Federal Reserve Bank of New York, total credit card debt rose nearly 5%, or about $45 billion, in the second quarter to a new high of $1.03 trillion.

thumbnail_Credit Cards

Although delinquency rates are still low by historical standards, rising balances may present challenges for some borrowers going forward, particularly when student loan payments resume this fall, according to the New York Fed.

A ’Huge Test’

"The resumption of student loan payments will be a huge test for many cardholders, shrinking the amount they have to devote to paying off card debt and leaving some people simply unable to make minimum payments at all," Matt Schulz, LendingTree's chief credit analyst, told CNBC. "One trillion dollars in credit card debt is staggering. Unfortunately, it is likely only going to keep growing from here."

CNBC noted that after a sharp slowdown in 2020, credit card balances have grown year over year for the past seven quarters, largely due to strong consumer spending in the face of higher prices, the New York Fed researchers found.

‘Brisk Growth’

"Credit card balances saw brisk growth in the second quarter," Joelle Scally, regional economic principal in the New York Fed's research and statistics group, said in a statement. "And while delinquency rates have edged up, they appear to have normalized to pre-pandemic levels."

The average credit card rate is also more than 20% on average, another all-time high.

Comments

Post a Comment

Please no profanity or political comments.

Popular posts from this blog

Why credit unions need to be formulating a strategy for crypto & digital...

“The future of money isn’t coming – it’s here, growing at $4 trillion and accelerating,”  DaLand CIO, Jon Ungerland said in a statement. “Their solution ensures the institutions that matter most to American communities don’t miss the transition.” https://www.dalandcuso.com/videos-podcasts __ ______________________________________________ Check out NCOFCU's additional features: First Responder Credit Union Academy Podcasts YouTube Mini's Blog Job Board
Post a Comment
Read Complete Article HERE>»

Sunday Reading - 401(k) plans, explained

  Worker Nest Eggs       401(k) plans, explained Originally intended for corporate executives, the 401(k) is now, arguably,   the most famous section of the US tax code   and a staple in worker benefits packages and personal finance guides ( watch 101 ). Roughly 70 million Americans, with a total of more than $7T invested , use these long-term, tax-advantaged accounts to build toward a more secure retirement. Some critics claim that with 401(k) plans, companies offloaded the risk of retirement savings to workers without the training to avoid volatile portfolio mixes. Amid the 2008 financial crisis, many 401(k) plans lost over a quarter of their value , an event that hit those near retirement particularly hard. ... Read our full explainer on the plan...
Post a Comment
Read Complete Article HERE>»

Mortgage Rates Tick Down

MCLEAN, Va.--Mortgage rates moved slightly lower this week, with the 30-year fixed-rate mortgage averaging 6.56%, Freddie Mac reported. “Mortgage rates are at a 10-month low,” said Sam Khater, Freddie Mac’s chief economist. “Purchase demand continues to rise on the back of lower rates and solid economic growth. Though many potential homebuyers still face affordability challenges, consistently lower rates may provide them with the impetus to enter the market.” The 30-year FRM averaged 6.56% as of Aug. 28, down from last week when it averaged 6.58%. A year ago at this time, the 30-year FRM averaged 6.35%. The 15-year FRM averaged 5.69%, unchanged from last week. A year ago at this time, the 15-year FRM averaged 5.51%, Freddie Mac said. ____________________________________________ Check out NCOFCU's additional features: First Responder Credit Union Academy Podcasts YouTube Mini's Blog Job Board
Post a Comment
Read Complete Article HERE>»

NCOFCU YouTube Video Minies

  https://www.youtube.com/playlist?list=PLT3lzRTXnHw4YHnT2TzILxP7Rfkjn0eT1  __ ______________________________________________ Check out NCOFCU's additional features: First Responder Credit Union Academy Podcasts YouTube Mini's Blog Job Board
Post a Comment
Read Complete Article HERE>»

Open Banking Pushes Leading Credit Unions Ahead In Race For Member Loyalty

  https://youtu.be/pUIV8hwSDCE NEW YORK—Credit unions that embrace open banking aren’t just keeping pace with competitors—they’re pulling ahead, new data show. A new report finds that innovation in digital tools and personalized experiences is emerging as the decisive factor separating credit unions that win lasting member loyalty from those at risk of losing ground. “ The 2025 Credit Union Innovation Readiness Index: Closing Gaps, Winning Members ,” a June report produced in collaboration between  Velera  and PYMNTS Intelligence, underscores innovation as a defining factor for credit union success. iStock-Korakrich Suntornnites “Facing shifting expectations from both consumers and small to medium-sized businesses (SMBs) toward digital convenience and tailored experiences, credit unions must modernize not just to compete with traditional banks, but to remain relevant to their members. The report, based surveys of 500 credit union executives, 15,000 U.S. consumers, and nea...
Post a Comment
Read Complete Article HERE>»