After a steady rise in credit card debt for eight years throughout the country, that debt dropped last year. Experts say that the combination of less spending, government relief efforts that allowed people a breather from their student loan and mortgage payments and stimulus payments helped lower U.S. credit card debt. Nonetheless, it still totaled a whopping $770 billion in the first quarter of this year.
Not everyone throughout the country has the same level of credit card debt and delinquencies. States in the South (including Florida) and the Mid-Atlantic region have the highest delinquency rates. Florida is near the “top” when it comes to residents burdened by credit card debt, with a delinquency rate (the percentage of debt that’s at least 90 days late) of nearly 12% and a balance per capita of over $3,300.
Credit card debt has multiple causes
As the economy begins to get back to some semblance of normal and the relaxed payment deadlines that many companies were offering have ended, many people are starting to take a look at their credit card and other debt and finding that it’s more than they can manage. As one independent credit counselor says, “It takes some guts to admit that someone’s spending is out of control, but it’s a giant weight off of their shoulders when they finally take control of it,” he said.
Of course, high credit card debt isn’t always a sign of overspending. One study found a correlation between high unemployment rates and high credit card delinquency rates.
If your credit card debt is affecting other aspects of your finances, like your ability to pay your mortgage, rent, student loans or even regular household expenses, it’s wise to explore your various options, including potentially filing for bankruptcy. With some experienced legal guidance, you can determine the best path for you moving forward.