I don't have time or interest in tracking down the source data compiled by Bankrate, so I don't know how much of this "average debt" is amassed by wealthy cardholders and how much is subject to carryover interest, tho they do note that "44 percent of cardholders carried a balance from month to month in January 2024." This is an insidious and malicious form of debt. I'm profoundly saddened to see the levels this high.
Image cropped from the one at Visual Capitalist.
There is a fundamental problem in the financial industry that allows banks to prey on financial illiteracy.
ReplyDeletePeople are responsible for their own finances, but it's pretty hard to be responsible when the financial industry is pretty much allowed to lie to you at every turn. Mortgage and realtors "advisors" will always tell you you can afford the higher-than-you-want to house, while quickly rushing over the HOA fees. Same for car dealers. Retirement advisors. And time-share sales people, even though the last one isn't much of a surprise.
Even as a pretty numerically literate person, it's pretty hard to me to find out during negotiations where they're swindling you out of bags of money. And while I enjoy calling them out and stopping them in their tracks, it is beyond frustrating that I then have to start doing the dance with someone else until I find a decent deal (where at least I can't find the huge swindle). And they're relentless. When you catch them, they will generally just laugh at you in your face until you do the arithmetic to prove them wrong. And even then, they'll still try to wipe it under the carpet. "Oh, that doesn't matter on the big picture". But it does.
Liars. They're all liars. They get commission on the amount of money they swindle from you and could not care less that in 5 or 10 years you're in trouble.
Do your budget. Stick to it. Realize that you will spend any maximum you mention so be conservative. Never spend more than you wanted. Interrupt and walk out of every pressure sale you encounter. Also walk out anytime someone lies to you. Point out the lie, get up and leave. Do not argue.
There is a better deal out there.
I can't argue with any of that.
DeleteCredit card debt by generation, according to data from credit reporting agency Experian. (Oct 2024)
ReplyDeleteGeneration X: $9,255
Baby Boomers: $6,648
Millennials: $6,642
Silent Generation: $3,375
Generation Z: $3,266
There was an article in the NYT yesterday about swipe fees. Never has an action been more aptly named. It touches on lack of competition in the industry and some of the feeble attempts to correct that. And of course how much it costs merchants who somehow fail to account for said fees which is baffling on two fronts - why the fee isn't assessed at the transaction or/and why the merchant (accounts) doesn't have funds automatically set aside.
ReplyDeleteThe big gripe however is still why can't/don't merchants charge 4% more for card user or 4% less for cash and why that isn't a federal regulation.
I occasionally encounter merchants who post signs saying "discount for cash" and sometimes the discount is higher than the card fee, so I wonder if they are just hiding income from the IRS.
DeleteCould well be, no doubt some are or want to. If they take debit cards (at cash prices/discount) then it's less likely that's the motive... or we collectively just don't understand the blockchain(s). ;
Deleteand why that isn't a federal regulation.
DeleteGood thing the CFPB will be deleted soon so we don't have to wonder anymore why such regulations don't exist.