Americans take on more credit card debt

Floridians often turn to credit cards to help them make ends meet. Although credit cards offer short-term solutions, they can also cause financial devastation when they’re not used responsibly. However, sometimes credit card debt is difficult to avoid. Fortunately, people who need debt relief may be rebuild their financial lives through personal bankruptcy.

As the economy is slowly recovering, Americans have continued to rack up credit card debt. Although overwhelming credit card debt can be detrimental to people’s financial health, according to some economists, rising credit card usage is a sign of a strong economy. Consumer spending accounts for a large percentage of the national economy. However, Americans’ credit card debt remains significantly below pre-recession levels and is not expected to rise in the next few years. Instead, Americans are taking on more student loan debt. The report did not include data on Americans’ mortgage and home equity loans. 

Even though Americans have begun to spend more, that doesn’t mean that they’re earning more. In fact, the savings rate has recently dropped. Due to the recent Social Security tax hike, employees are bringing home less pay. Some households may have thousands of dollars less to spend on goods and services each year. As a result, the savings rate has declined.

 Thankfully, the national employment rate is expected to rise, which will refuel more consumer spending and a more robust economy. Nevertheless, some people will continue to suffer from overwhelming debt. Fortunately, bankruptcy may provide debt elimination. People who are struggling with debt may find it helpful to work with an experienced bankruptcy lawyer.

Source: Miami Herald, “WASHINGTON: US consumer borrowing up as credit card use rises,” Martin Crutsinger, July 8, 2013