Households racking up debt, all because incomes are failing to keep pace!

[Sig]

$16,000 isn't a lot?

Ha

Put yourself in $16000 worth of credit card debt with an interest rate at about 15% and see how long paying just the minimum payment would take to pay and how much interest you would have paid out. .

Also as your credit card debt balloons so does the minimum payment... So a minimum payment on $16000 would be approximately $500+ a month!!

If someone is putting that much debt on their credit card to me it seems they don't have a monthly income to pay for goods and services they desire.....

Or they're smart and put everything on their credit card possible to get either cash back or airline miles and pay off their balance in full every month. Notice how they conflate credit card balances with credit card debt? If you do a little math, they say the average household pays $1,292 in interest payments each year. At 15% interest, that's an actual debt of $8,600, almost exactly half the "average balance" that they purposely misled us to believe was debt. And again with the numbers getting thrown out, without context it's meaningless. Even $8,600 in debt is a big deal against a $24,000/year income. For most of us it's an average balance we pay off every month, and even if it were debt it would be minimal in the grand scheme of things.

 

[zdreg]

We all know most end up going to collection agencies where the consumer ends up paying about 15 cents on the dollar.... Rinse and repeat...

can you provide a link to show validity of statement? is that without declaring bankruptcy?

 

[Dolemite]

I don't think it is the income not keeping pace so much as it is people wanting to buy the latest and greatest of everything without thinking about the cost. $800 surface pro to be current, $299 iphone since last year's is so uncool. I think if people really added up the amount they spend on electronics alone (especially families with kids) they would be shocked. People have lost their minds.