U.S. credit card debt hits all-time high at $1.13T
OAN’s James Meyers
9:10 AM – Thursday, February 8, 2024
Credit card debt across the United States hits another record high, according to the latest report.
New data released by the Federal Reserve Bank of New York on Tuesday showed that Americans’ credit card balances have reached a staggering amount of $1.13 trillion.
The data also showed that credit card debt increased by $50 billion in the fourth quarter of 2023, which is a 4.6% jump from the previous quarter.
Additionally, with the alarming rise in credit card debt, total household debt rose by $212 billion to reach $17.5 trillion in the fourth quarter of 2023, according to the New York Fed’s latest ”Quarterly Report on Household Debt and Credit.”
According to Bankrate’s senior industry analyst Ted Rossman, inflation and higher interest rates are the leading causes of the credit card debt problem across the country.
With the rise in credit card debt it’s also reflecting on missed payments for credit card bills by the average American, causing delinquency rates to skyrocket.
“We’re seeing more people carrying more debt for longer periods of time,” Rossman said in an emailed statement. “For example, 49% of credit cardholders carry debt from month to month, up from 39% in 2021.”
Furthermore, across the U.S. people are taking on more debt when they purchase vehicles. Auto loan balances rose an eye-popping $12 billion in the fourth quarter to $1.61 trillion, causing delinquencies to rise as well.
Student debt loan balances also increased by $2 billion and currently stands at $1.6 trillion.
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What is the current amount of credit card debt in the United States according to the Federal Reserve Bank of New York’s latest report?
Credit card debt across the United States has reached another record high, according to the latest report released by the Federal Reserve Bank of New York. The data shows that Americans’ credit card balances have reached a staggering amount of $1.13 trillion, with an increase of $50 billion in the fourth quarter of 2023, marking a 4.6% jump from the previous quarter.
This alarming rise in credit card debt has also contributed to an overall increase in total household debt, which rose by $212 billion to reach $17.5 trillion in the fourth quarter of 2023. These figures emphasize the growing burden of debt that many Americans are facing.
Experts have identified inflation and higher interest rates as the leading causes of the credit card debt problem. Ted Rossman, Bankrate’s senior industry analyst, explains that these factors make it increasingly difficult for people to timely repay their credit card bills.
Furthermore, this surge in credit card debt has also resulted in a significant increase in delinquency rates. Many average Americans are struggling to make timely payments, causing delinquency rates to skyrocket.
The implications of this trend are concerning as it affects both individual consumers and the overall economy. Rising debt levels can hinder economic growth and stability, and can also lead to financial distress for individuals and families.
It is crucial for individuals to effectively manage their finances and take steps to reduce their credit card debt. This may involve creating a budget, cutting unnecessary expenses, and seeking professional financial advice when needed.
Financial institutions and policymakers also have a role to play in addressing this issue. They should work towards implementing measures that promote responsible lending practices, enhance financial literacy, and provide support and resources for individuals in debt.
In conclusion, the recent report on the record-high credit card debt in the United States is a cause for concern. It is essential for individuals, financial institutions, and policymakers to collaborate and take proactive steps towards reducing debt burdens, promoting financial education, and creating a healthier financial landscape for all.
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