We are seeing several indicators that the economy may be slowing, including the stock market’s bumps in December and cooling housing markets in many regions. With some experts projecting a recession, now is the time for consumers to take a hard look at their finances and eliminate credit card debt.
SAN MATEO, Calif. (PRWEB) January 10, 2019
The year’s first consumer debt report revealed that in November, leading into the holiday season, American consumers continued their surge of credit card spending – which makes this month the ideal time for those individuals to enact a New Year’s resolution to pay off that debt.
“After nine months with scarcely any increase in credit card debt, the last two months presented a huge jump in revolving credit. Consumers charged $14 billion in October and November alone,” notes Daniel Cohen, managing editor of Bills.com®, a resource providing simple tips, advice and tools to help consumers make smart financial decisions. “While some consumers may have been loosening their purse strings for the holidays after a prudent year, many others might be diving into deeper debt – and at the time that the Federal Reserve raised interest rates for the fourth time in as many quarters.”
According to figures released Jan. 8 by the Federal Reserve, total consumer credit increased at a seasonally adjusted annual rate of 6.75 percent in November. Revolving credit – primarily credit card accounts – rose to $1.042 trillion, a year-over-year increase of 5.5 percent, on top of October’s leap of 10.9 percent.
The latest figures show that nonrevolving credit increased at an annual rate of 7.1 percent, to $2.937 trillion. Nonrevolving debt includes outstanding credit for items such as vehicles, education and unsecured installment loans. The consumer debt data does not include home mortgages or home equity borrowing.
With the latest interest rate hike, the cost of debt continues to increase. The average credit card interest rate reached another new record high in early January, at 17.41 percent. Many consumers are paying even higher rates, which bring with them higher minimum payments and longer payoffs.
“We are seeing several indicators that the economy may be slowing down, including the stock market’s bumps in December and cooling housing markets in many regions,” says Cohen. “With some experts projecting a recession in the near future, now is the time for consumers to take a hard look at their finances and work to eliminate credit card debt.”
Cohen suggests several options for people who have made a New Year’s resolution to pay down their credit card debt. “Everyone’s situation is different, and options vary based on an individual’s debt-to-income ratio, credit score, assets and preferences. Many people find great relief from a debt consolidation loan, a debt management program or debt settlement program. Our website at Bills.com offers guidance people need to make these difficult decisions.”
Bills.com is part of the Freedom Financial Network®, a family of companies whose products and services provide innovative solutions that empower people to live healthier financial lives. The Bills.com resource site provides simple tips, advice and tools – including the Bills.com debt relief calculator – to help consumers make smart financial decisions.
Headquartered in San Mateo, California, Freedom Financial Network also operates an office in Tempe, Arizona, and employs more than 2,200. The company has been voted one of the best places to work in both the San Francisco Bay area and the Phoenix area for several years.