Long Island residents might need to put some of their expenses on credit cards. While this is not problematic in and of itself, unchecked spending on credit cards can put some people in a precarious financial situation.
If New Yorkers think that the average amount of Americans’ credit card debt is relatively high, they’re right. In fact, in 2013, credit card debt increased at the steepest rate it has in the last several years.
There are a couple of ways to interpret this information. One is that it means that people are feeling good about economic conditions and are spending more because consumer confidence is improving. Another viewpoint is that people are having more trouble making ends meet, and that increasing their credit card debt is just a step on their way to more serious financial trouble — and the potential for filing for bankruptcy.
In December, the average household had just over $7,000 in credit card debt. Overall, that’s a total of more than $850 billion of revolving debt. For the year, there was an increase of 1.3 percent, which is more than the previous two years, when increases were under 1 percent for each year.
While $7,000 might be a manageable number to some people, that’s just the average. There are lots of households whose debt is several times that much. These people might be able to benefit from filing from bankruptcy. For many New Yorkers, it’s an action that could lead to a greater degree of financial freedom than they’ve had in a long time.
Source: The Plain Dealer, “Credit card debt in U.S. increases in 2013 as consumer confidence grows, rates drop,” Teresa Dixon Murray, March 18, 2014