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Transactors pay their credit card balances in full every month and don’t pay interest.Revolvers carry credit card debt from one month to the next, paying interest on their average daily balance. household with revolving credit card debt carried a balance of ,081 as of June 2017.Our survey found that consumers accumulate credit card debt for different reasons, including spending above their means, bouts of unemployment and paying for the essentials that their income doesn’t cover.
There are two main types of credit card users, transactors and revolvers.
By Erin El Issa Nerd Wallet’s 2017 household debt study shows that several major spending categories have outpaced income growth over the past decade; many Americans are putting medical expenses on credit cards; and the average indebted household is paying hundreds of dollars in credit card interest each year.
It’s not all bad news, though: Household income growth is no longer being outpaced by the total cost of living.
Since Nerd Wallet’s number focuses on credit card debt only, the 5 billion is a more accurate estimate of how much debt is outstanding.
It’s also important to note that this total includes the balances of cardholders who pay off their cards in full every month, as well as those who carry debt from one month to the next.