Are you struggling with credit card debt? You are definitely not alone, according to recent studies. Consumer debt is moving toward its highest point since 2009. Some of our debt problems are corollary to the recent holiday season, of course. Even so, as of the end of 2015, revolving debt rose to $936 billion - up from $930 billion in November 2015. These numbers are growing dangerously close to the 2009 recession stats.
What is revolving debt?
Revolving debt is made up of undefined or unlimited accounts with variable interest rates and preset credit limits. Examples of revolving debt include home equity, credit cards and personal lines of credit.
In America, the average household debt is $5,700. Moreover, the average American carries $2,300 worth of debt on credit cards. Based on Census Bureau and Federal Reserve Board reports, these numbers include those who pay off credit card debts each month, as well as those who carry balances from month to month.
Which people are most vulnerable to missing payments? Studies suggest those with little net worth, who frequently pay interest rates of 15 percent to 17 percent on their credit card, generally owe the most. Balances are more than twice as high as the national household average, according to the report. Those households with the lowest net worth owe $10,308, on average, in credit card debt.
Drowning in debt?
If you are struggling with debt, your best bet is to pay highest-rate cards first. It also helps to develop a money reserve. This way, you can begin paying off credit card debt with each subsequent month. However, if you believe you have exhausted all avenues of debt relief on your own, the best thing you can do is talk to an attorney.
With a lawyer, you can work to through Chapter 7 or Chapter 13 to help eliminate credit card debt. Credit card debt is often considered unsecured, meaning it is completely dischargeable in bankruptcy. A legal advocate can help you assess how to proceed.