Study shows young Americans may always have credit card debt
Even while the economy is improving, a recent study has revealed that many Americans are likely to have credit card debt for the rest of their lives. According to the study, conducted by Ohio State University, younger Americans are the demographic most likely to have continuing credit card debt.
The study revealed that younger credit card holders – those in their 20s and 30s – have more credit card debt, on average, than older generations. According to the report, Americans born between 1980 and 1984 owe around $5,700 more in credit card debt than those born between 1950 and 1954 – their parent’s generation. In addition, the younger demographic owes, on average, $8,200 more than people born between 1920 and 1924 – considered their grandparent’s generation.
On top of these already large credit card debts, researchers predict that the younger generation will keep amassing credit card debt as they age, continuing even into their 70s.
Credit card debt rose across US in 2012
Not only are younger Americans experiencing an increase in their credit card debt, recent statistics from the Federal Reserve Bank of New York showed the amount of credit card debt across the country is on the rise. According to the report, credit card debt in the U.S. increased by $2 billion during the third quarter of 2012.
TransUnion reported that the average credit card holder owed $4,996 in credit card bills in the third quarter of last year. The credit bureau predicted that the average debt will continue to rise throughout 2013, possibly reaching as high as $5,446 for the average consumer.
In addition, TransUnion determined that a rising number of people will likely be more than 90 days overdue on their credit card bills throughout the year. According to the credit bureau, banks are providing credit cards to risky clients again, increasing the likelihood of more people defaulting on their bills.
Discharge credit card debt through bankruptcy proceedings
For those with unmanageable credit card debt, there are options available to improve your financial standing. Filing for bankruptcy can lead to credit card debt being discharged.
In some cases, filing for Chapter 13 bankruptcy may be the best alternative. Under Chapter 13, individuals establish a repayment plan that allows them to repay certain debts over a certain period of time – often three to five years. Thereafter, remaining debts may be discharged.
For others, filing for Chapter 7 bankruptcy may provide the best route to financial security. Consulting with a skilled bankruptcy attorney will ensure you choose the best path to regaining financial stability.