ORLANDO, Fla — Many people start the year off with the goal of paying down their credit card debt. A new survey by Bankrate shows nearly half of all cardholders carry debt month-to-month.
During the holiday season it’s easy to swipe the card and make purchases. For many that just adds to consumer debt that was already a burden.
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“Poor financial decisions on our part when we were younger, having kids, uh, vehicle problems,” said Brian Hodge when Action 9 spoke with him in September.
Several years ago, what Hodge described as “every day American problems” landed his family in a financial nightmare. And with the results of the new survey, he’s clearly not alone.
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Ted Rossman, Senior Industry Analyst at Bankrate told Action 9 Consumer Investigator Jeff Deal, “There are a lot of people carrying a lot of debt for a long time.”
Rossman was speaking about the results of Bankrate’s survey that shows 48% of credit cardholders in the U.S. carry debt from month to month and 53% of them have been carrying that debt for more than a year. Many of them said life is just getting expensive.
“The number one answer is an emergency expense, some sort of unexpected medical bill, or home repair or car repair. Second place would be day-to-day expenses,” said Rossman.
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For Brian Hodge, things got so bad, a financial advisor recommended filing for bankruptcy.
Hodge said, “Just scrap and call it done and start over. But we don’t want to do that. Maybe it’s a bit of a pride thing. I just I didn’t want to have bankruptcy associated with me.”
Instead, he did one of the things Ted Rossman recommends. He worked with a reputable non-profit credit counseling service called Money Management International.
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Rossman also recommends signing up for a transfer credit card with a 0% rate and moving the debt to that card and start paying it down. Also, look for ways to cut expenses and increase the money coming in with something like a side-hustle or even by selling belongings you don’t need.
In Hodge’s case, he was able to pay off $26,000 in credit card debt in less than four years. It was a move that changed his life.
He had this message, “Don’t spend money you don’t have. Don’t spend money you don’t have.”
If you don’t go with a zero-interest credit card transfer, it’s best to pay off the highest interest loans first. Although, some people feel more motivated by paying off the smallest debts first to minimize the number of creditors.
To read more about the survey done by Bankrate: www.bankrate.com/credit-cards/news/credit-card-debt-survey/#payoff