How to Manage Credit Card Debt
In 2016, American Credit Card Debt Statistics show that the average American household debt is over $5,500. The average for balance-carrying households is over $16,000, with a total outstanding U.S. consumer debt of $3.4 trillion.
Even though America’s economy may be in better condition now, studies show that credit card debt took a dip after the recession, but has risen again since then. 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.
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.
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