Published in: Credit Cards | Nov. 20, 2018
By: The Ascent Staff
According to The Ascent latest credit card debt statistics, Americans held an average of four bank-issued credit cards and those with card debt averaged $6,028. That's a lot of money, especially if you're paying interest of 15% to 20%.
Here's a snapshot of Americans' credit card debt, along with some tips on how to get your own debt under control.
While the average American cardholder with credit card debt decreased 0.2% from Q1 2018 to Q1 2019, this doesn't tell the whole story -- there is a big range of gross indebtedness across age ranges. Americans in the 50-59 age range have amassed $208 billion of credit card debt, compared to $53 billion for younger Americans in the 18-29 age range.
In addition, credit card debt varies widely by geographic location. According to The Ascent's analysis, average credit card indebtedness ranges from a low of $4,622 in Iowa to a maximum of $7,726 in Alaska.
There's no one-size-fits-all method of determining how much credit card debt is too much. Using a credit card can be worthwhile if the purchase will more than make up for the interest you pay -- for example, if it helps you pay off an even higher-interest debt. The definition of too much credit card debt depends on you, your income, and your comfort level with debt.
That said, in most cases, any high-interest credit card debt is too much.
If you only make the minimum payments, it can take many years to get rid of credit card debt. So the obvious solution is to pay down your principle as quickly as possible. A lower balances mean less interest will be accumulating, and more of your future payments will be applied to principal, not interest.
If you're having trouble finding extra money to put toward your credit card debt, look into balance transfer credit cards. By transferring your balances at 0% interest, every penny you pay will go toward reducing your principle -- not toward lining your credit card company's pockets.
The average American consumer owes $5,551 on their credit cards, and if you ask me, that's $5,551 too much. One of the smartest personal-finance decisions you can make in 2017 is to aggressively pay down your credit card debt, so make a plan and stick with it.
As long as you pay them off each month, credit cards are a no-brainer for savvy Americans. They protect against fraud far better than debit cards, help raise your credit score, and can put hundreds (or thousands!) of dollars in rewards back in your pocket each year.
But with so many cards out there, you need to choose wisely. This top-rated card offers the ability to pay 0% interest on purchases until late 2021, has some of the most generous cash back rewards we’ve ever seen (up to 5%!), and somehow still sports a $0 annual fee.
That’s why our expert – who has reviewed hundreds of cards – signed up for this one personally. Click here to get free access to our expert’s top pick.
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