Many Americans are entering 2025 in a challenging financial position, particularly regarding credit card debt. A recent report from Bankrate reveals that nearly half of credit cardholders, specifically 48%, are now carrying debt month-to-month, a notable increase from 44% at the beginning of 2024. Among those with debt, 53% have been in this situation for over a year, indicating a troubling trend. The primary reasons for carrying a balance include unexpected expenses, such as medical bills and home repairs, alongside the pressures of higher daily costs and overspending. Economic factors like high inflation and interest rates have compounded these issues, leading to a significant rise in the average credit card balance, which now stands at $6,380—an increase of 4.8% year-over-year. If individuals only make minimum payments on this average balance, it could take over 18 years to pay it off, accruing more than $9,344 in interest, highlighting the long-term implications of this debt.
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