The most recent fiscal quarter has officially seen credit card debt in the United States hit $1 trillion.
This milestone isn’t terribly surprising, according to Bankrate Analyst Ted Rossman.
Rossman said, “We would expect credit card balances to grow over time. Increased consumer spending, which powers a lot of economic growth, more card usage because cash is less and less of a thing with each passing year, population growth … A lot of people are close to the edge. I mean even a lot of upper-income households are living paycheck to paycheck”
One positive finding, however, is that 53% of people regularly pay off their credit card balances.
However, Bank of America found there’s been an increase in people making withdrawals from 401k retirement accounts.
LendingTree analyst Matt Schulz said of this increase, “The opportunity cost for that is so great because that’s money that’s not going to be able to compound interest for 25-30 years.”
Are you carrying a significant amount of credit card debt? Have you made withdrawals from your 401k?