The Blubber

Nearly 10% of credit card users in America now find themselves in persistent debt where they are charged more in interest and fees each year than they pay on the principal.

A recently published report on household indebtedness by the Federal Reserve Bank of New York reveals that credit card debt in the U.S. has surged to a historic high of $1.08 trillion. Concurrently, credit card delinquency rates are witnessing an uptick, particularly among the millennial generation burdened with student loan debt, according to the New York Fed.

Another study from the Consumer Financial Protection Bureau underscores the growing reliance of Americans on credit cards to cope with escalating living costs, especially concerning food prices and gasoline expenses. The report indicates an increase in cardholders carrying month-to-month debt, falling behind on payments, and landing in delinquency.

The Consumer Financial Protection Bureau notes that almost 10% of U.S. credit card users now experience persistent debt, where annual interest and fees surpass the amount paid towards the principal. The rising interest rates, a consequence of the U.S. Federal Reserve's 11 rate hikes in the past 18 months, have propelled the average annual interest rate on credit cards in the U.S. to an all-time high, exceeding 20%.

Read more: https://unusualwhales.com/news/credit-card-debt-has-reached-1-08-trillion-in-us-an-all-time-high