In February of this year the United States government and census data determined that that the average adult in the US has $3,752 in revolving credit card debt. This is really a decline from July of 2009, when the average credit card debt per person was estimated at $4,013. The total credit card debt of the average entire household in the United States is $7,394 down from $7,861. Seemingly the US consumers have actually wised up to their credit debt spending ways.
There was clearly some other interesting facts released by the Federal reserve board as well. According to the study, 75% of all Americans have one or more credit cards. The surprising number to me is that 25% of household actually do not have any credit cards of any kind at all.
This review is actually very encouraging for my overall perception of the spending habit of Americans. What this data suggests is that there’s a nice percentage of the population that is fully aware of how costly having credit cards can be. I might be curious to discover how this 25% without any credit cards at all breaks down demographic wise. Basically I hope that the 25% does not just account for people who are under the age of 18 and simply can’t get a credit card yet.
I would really like to consider though that the recent credit crunch is in fact teaching important lessons to those who spent in great amounts during the economic boom but are now strapped for cash and are looking for solutions on how to eliminate credit card debt. The raging economy prior to the start of the recession was simply too easy to get money with. I had so many friends who were mortgage brokers who could get someone approved for a loan that was a “no doc” loan. What this means in simple English is that one didn’t need any type of documentation to obtain the loan. One of my close buddies told me that he was able to approve a guy with his ID from working as a bus driver.
People spent and spent, but now there is no more money to spend and jobs are much tighter then they have ever been. Companies are cutting back which has led to less people having jobs or even if they have jobs they most likely are not getting the hours that they once had. In fact, those people who were already loaded with credit card debt prior to recession were seen looking for credit card debt settlement such as Indiana debt relief or Virginia debt relief.
The final outcome that I draw from the evident decrease in the total amount of revolving debt is this. There was an increase in credit card debt at the time the economy took a quick turn south. This was simply because people didn’t have jobs and had to use them. The improvement can be based on both the economy slowly improving in conjunction with the reduction of consumer spending on their credit cards.