Credit card debt rose to its highest level in over 20 years at the end of 2021! People are using their credit cards more than ever, and are racking up some serious debt.
What does this mean, and what can be done?
The historic increase could be attributed to holiday spending, the increased prices of housing and other goods, the lingering effects of the pandemic, and/or continuing struggles like unemployment.
No matter the cause for the rise in debt, it's getting harder and harder to pay it off.
Due to inflation, the Federal Reserve is increasing interest rates. This will make it more difficult to manage credit cards if people don’t pay off their balances in full each month.
The average credit card charges about 16% in interest, and that’s expected to go UP.
Debt is becoming so hard to pay off, many people are either resulting to taking out personal loans or defaulting on debts – which can RUIN one’s credit.
The only way to avoid this is to pay off debt immediately – a tough task for most of us.
Our economic system takes advantage of low and medium-income people by trapping them in a cycle of debt. It’s crucial that we get our finances under control and get rid of debt if we’re ever going to achieve financial liberation!