People Really Love Using Their Credit Cards & It’s Become a Big Problem–This Is Why
Society has successfully moved on from using cash to swiping their credit cards for a good part of all their paying needs. In fact, there are around 374 million open credit card accounts in the United States alone. This is certainly a convenience that people today are lucky to have. However, Americans’ love for using their credit cards has also resulted in a serious financial problem.
What Keeps People Hooked
According to a survey done by the banking and investing app Stash, numerous people across multiple generations don’t even know the interest rate that their credit card provider makes them pay.
The exact figures stand at around 30% of millennials, about 40% of Gen Xers, and over 40% of Gen Z, who don’t know their cards’ interest rate. This has become a problem today as Americans reportedly ended up paying a whopping $113 billion just for credit card interest. Even more concerning is that this same statistic stood at a much lesser $76.3 billion just five years prior.
Considering all thsese, the question now is why people still continue to use their credit cards as they lose money? Apparently, they’re hooked on the various rewards and points programs that their credit card providers entice them with. About one-third of people who are in debt report that they continue to pay using credits because of the perks.
But it looks like the rewards they get aren’t worth it in the end at all. Proof of this is the many young people in debt from using their credit cards as their main means for spending. As of latest, revolving credit card balances in the United States have already exceeded $1 trillion. And this debt has also become a hindrance for people to save up for their retirement.
Fortunately, it’s not too late for people to take a hold on their swiping habits. Eagle Strategies certified financial planner Michael Kremer recommends looking for a debit card with a points program in lieu of a credit card.
Meanwhile, those who are still determined to keep spending on credit are advised to pay closer attention to their swiping habits. Kremer suggests people look for a chance to transfer to a card or provider with a 0% interest rate offer while paying off their balances.
Doing this can save them a lot of money and actually make a dent on their principal instead of just paying off interest. One more alternative those in debt should consider is using a cash-secured credit card that has a low limit. This route will come in handy when one is making a big purchase while avoiding the temptation of spending more.
How often do you pay with your credit card? Read on and find out if you have the same problem many other people have.
More in Pocket Change
This is What People are Doing with their Savings and Why You Should Do It Too
People are not spending their money on shopping and going on extended tours, but are putting the dough into the saving...March 13, 2020
Here’s How You Can Stay Productive While Working Remotely
If you are a freelancer or a self-employed worker, you get to enjoy the many perks and convenience of working wherever...March 13, 2020
Here’s what UK’s Recruitment Agency “Hays” Boss Has to Say about Immigration Plans
UK’s government controversial decision about immigration has been supported and endorsed by the Boss of recruitment giant Hays. He has shared...March 12, 2020
Should Retirees Invest in the Stock Market?
As it is reported that stocks of North America keep on sliding, numerous retirees who figured they could get a profit...March 12, 2020
Jazz Singer-Songwriter Norah Jones Just Sold Her Cobble Hill Home Equipped with a Heated Pool
Grammy-winning jazz singer-songwriter and pianist Norah Jones has parted ways with her historic home where she reportedly wrote her famous songs. It seems...March 12, 2020
How Working Women Can Secure Their Retirement Savings Now
It turns out, several working women fail to secure their retirement savings. According to a recent study titled CNBC/SurveyMonkey Women at...March 11, 2020
Here Are All the Luxurious Things Mike Bloomberg Could Have Bought With His $500 Million Net Worth Before Spending All of Them
There wasn’t a lot of uplifting news on Super Tuesday for the more dynamic wing of the Democratic party as Bloomberg...March 11, 2020
Most Expensive 2021 Porsche 911 Turbo S Costs Over $273,000
The Porsche 911 is already a costly vehicle, even in base Carrera structure but the new 992-Series 911 Turbo S is...March 9, 2020
Save Not Splurge: How People Are Using Their Tax Refunds Nowadays
Taxpayers are now opting to save their tax refunds, a significant change from the previous year wherein a lot of Americans...March 9, 2020