Credit Card Debt on the Rise in America

Credit Card Debt on the Rise in America

Core Facts

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Even though America’s economy is in somewhat better condition now, studies show that credit card debt is at the highest level since 2008. Based on data from the Federal Reserve, outstanding credit card debt is set to hit $1 trillion in 2016. This indicates that consumers are reverting to pre-recession spending patterns.  

A rise in credit card debt usually signals an improving economy. It shows that Americans think the economy is doing better, more people are working and earning a salary, and have more money to spend.  However, this mind-set also affects how they save. Americans’ personal savings rate was 4.4% back in 2008, it went as high as 11% in December 2012, and is now back down at 5.4%.  

There are other indicators that this rise in debt might not be all good news. There are indicators that growth is flattening. New York Federal Reserve President William Dudley said recently that the balance of risks to his growth and inflation outlooks may be starting to tilt slightly to the downside.

How to Manage your Credit Card Debt

Good credit card management boils down to:

  • Making payments on time
  • Paying more than the minimum payment due
  • Keeping balances low
  • Having a portfolio of cards with good rates

While it may seem to be the wisest course of action to make every effort to pay down your credit cards at the expense of other financial goals, experts advise that you focus on increasing emergency savings, taking advantage of the employer match in a 401(k) plan, and investing while paying down debt.


Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities. 

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable-- we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances. Member FINRA & SIPC


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Founded in 1976, David Lerner Associates is a privately-held broker/dealer with headquarters in Syosset, New York and branch offices in Westport, CT; Boca Raton, FL; Teaneck and Princeton, NJ; and White Plains, NY. For more information contact David Lerner Associates Call 516-921-4200 Visit our website:

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Jake Mendlinger
Account Manager
516.829.8374 X 232

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