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Federal Reserve figures show a jump

The average American consumer now has $ 6,194 in credit card debt, according to Experian. This rose from $ 6,040 in 2018.

In November 2019, the average credit card APR was 14.87%, according to Federal Reserve data, but this includes interest-free accounts, such as the introductory rates of the APR 0%. If you’re only looking at accounts that are rated for interest, the average APR is significantly higher than 16.88%.

So the average American has $ 6,194 in credit card debt at an average interest rate of 16.88%. A rapid multiplication tells us that the average consumer pays $ 1,045.55 a year just for the privilege of owing money to his creditors. It’s over $ 1,000 that could be used to save on retirement, added to a emergency fund, or used for practically any purpose that is more productive for your financial health.

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Do you have excessive credit card debt?

There is no fixed number that qualifies as “too much” credit card debt. What one person would call an overwhelming debt burden could be a completely manageable amount for another. Having said that, most financial planners (myself included) are of the mindset that whatever the amount of debt you are paying a double-digit interest rate on is too much.

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