TULSA, Oklahoma – Studies show that it is becoming increasingly difficult to pay off credit cards each month.
“Six out of 10 people have had credit card debt for at least a year,” said Bankrate analyst Ted Rossman.
He added: “Credit card delinquencies are at their highest level since 2011.”
Jennifer Ramseyer didn’t like seeing her debt continue to grow due to the 24% interest on her credit card balance.
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“It was renewed every month,” she said. “And you always pay that 24%.”
This prompted her to make paying off her card a top priority.
“I paid it off in about a year,” she said. “I’ve never had a credit card since.”
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Most people cannot survive without at least one credit card.
- Half of credit card holders carry debt from month to month
- Increase of 6% since January
- This is the highest percentage since March 2020
The calculation of the minimum payment is quite astonishing.
According to TransUnion, the average credit card balance is about $6,300 and the average credit card fee is $20.73.
So, in this average debt rate scenario, if you make the minimum payments, you’ll be in debt for 18 years and end up paying about $9,500 just in interest, which is really holding you back.
A much better approach would be to apply for a 0% balance transfer credit card. This lets you transfer your existing, expensive debt to a new card that charges no interest for up to 21 months.
You could pay $300 per month for 21 months and completely pay off this average debt with no interest.
I mean, that’s huge when you compare that to the almost two decades of the minimum payment scenario.
Ted Rossman, Bankrate analyst
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