Average credit card debt per U.S. adult, excluding zero-balance cards and store cards: $5,232.43
Average debt per credit card that usually carries a balance: $7,494.44
Average number of cards held by cardholders - bankcards: 2.24
Average debt per credit card that doesn't usually carry a balance: $1,128.44
http://www.creditcards.com/credit-card-news/credit-card-indu...
To settle the question you'd really need to know how many people carry a balance.
Regardless, I think US citizens are carrying way too much debt and...one day, this musical chairs dance will come to a stop. :/
The right, most informative conclusion about one $10k balance and 9 $0 balances is that "almost everyone in this group carries no balances, but one carries unmanageable debt", not "the average credit card debt is a manageable but significant $1000".
Statistics guarantees they are guaranteed to be high, not low. Medians and top/bottom percentiles would be more informative.
Source: have moved a _lot_ of credit cards through SEM.
One thing I think we can all agree on is that American's are deep into debt and it's not looking good. :/
That is amazing and terrifying.
And honestly both averages should be presented together, paints a terrifying picture
Take [0,2,100]: average is 34, but median is 2.
The average of a list of numbers is the value that minimizes the sum of squared difference to each value, sum([squared(mean - x) for x in list])
They're both summary statistics in that they're single numbers used to describe a dataset, but a median is not a "kind of average." The mean is the mean and nothing else.
"Average: a number expressing the central or typical value in a set of data, in particular the mode, median, or (most commonly) the mean, which is calculated by dividing the sum of the values in the set by their number." -- Google
There's a bunch of means (arithmetic, geometric, and harmonic, for instance), and they are all (as well as median and mode) averages.
Though, usually when people say "mean" without further specifics they mean the "arithmetic mean", and usually when they say "average" without further specifics they also mean "arithmetic mean" (though "median" is also fairly common, and "mode" isn't that uncommon.)
They say the average US household has $15,762 of Credit Card debt.[0] (that's disputed it could be from 5K to 15K depending on what numbers you believe) [1]
With an average rate of 15.07%[2]
Which works out to something like a minimum payment of $600 a month with $188 of it going to interest.
The Average US consumer is not just tapped out but actively being strangled by debt.
"47: The percentage of Americans who can’t pay for an unexpected $400 expense through savings or credit cards"[3]
What this really means is a near majority of the country is on the very brink of bankruptcy one trip to the ER (with insurance) or a tire blowout and down they go.
The terrifying part is that any hint of recession and the ripple effect could take a lot of us down with it.
[0] https://www.nerdwallet.com/blog/credit-card-data/average-cre... [1] http://www.creditcards.com/credit-card-news/images/infograph... [2] http://www.creditcards.com/credit-card-news/interest-rate-re... [3] http://www.federalreserve.gov/econresdata/2014-report-econom...
For example, I can get a $20k limit card. It's pretty unlikely that you can get a secured card with a $20k limit.
As for "pay-in-full" folks like you and me, credit card companies could care less. Whenever we pay with plastic, they get processing fees.
When you see that beside a $2000 or $3000 balance, it paints a pretty clear picture of what paying the minimum is doing for you. I think the only way it could be improved is by adding in how much interest you'll pay over that time period.
Only paying the minimum will certainly result in paying a large amount of interest.
Then come the vultures. Consolidation loans, payday loans, etc.
The way banks make money on those payments is the way any other interest loan payment works - you'll eventually pay what you owe but by the time you're done you paid the original debt + interest.
Yea 'CC Companies' is not the most accurate term, but when someone uses that term in a casual conversation I typically know what they mean :)
It usually says something like: On your $1000 balance, paying only the minimum will take 7.5 years to pay off the balance and you will pay a total of $3500. Pay $35/mo and will pay off your balance in 3 years and pay a total of $1500.
The issue isn't predatory lending by credit cards (necessarily anymore), it is our obsession with having material goods and "keeping up with the Joneses"... who are also in debt up to their eyeballs.
So, in my mind, it is just a race to the bottom (of your lifetime bank account).
Some people pay off their full balance every month without fail and would never consider carrying a balance.
Others have never paid their full balance. They see the "minimum payment" and think it's a great deal.
I find this to be extremely worrying... especially considering the average college graduate starts working with $25,000 in student loans.
Outstanding balances reached nearly $952 billion in the first quarter, ..."
This seems to imply that, by "keep a balance," they mean not paying your bill off every month.
Still, putting only rent on a CC = 1k+/mo where I live.
This is doubtful. The average U.S. household carries about $15k in credit card debt.
FWIW in months when I buy expensive plane tickets or make reimbursed purchases I skip paying rent with the CC.
Bank transfers really ought to be easier to do than they are.
They eat the couple percent in transaction fees. In return, almost all of their tenants now pay online and instead of the property manager chasing people down for money, everyone generally pays on time (or, in a number of cases, early).
Depending on your priorities, "not having to chase people down for money every month" might be worth paying the $500/mo.
I do not miss mailing checks in, and I do not wish to ever do it again.
My last apartment had the same option, so I think it's pretty common.
What I meant to ask was, "How do you pay rent with credit (without paying $30-40 each month for the privilege)?"
Love it, as it's how I get a ton of miles / points for money I'm already spending anyway.
Like Amex SPG costs $157 for 5000 points. If I pay my $1500 rent via my Amex but with an additional $50 premium, after 3 months, I have 4500 points for $150, versus being able to purchase 5k points for $157. If I spend $525, I can get 20k points. So it's better for this particular card to put aside the extra fees paid in rent then purchase the points in bulk at discount than earning the points directly.
Ideally, there's a landlord that doesn't assess an extra 2-3%, then it would totally be worth charging rent on a card.
In fact, I just used 75k of them for a first class ticket to Asia. At a "purchase cost" of $600—so I'd call that a sweet deal.
I have been thinking a lot lately on how the credit card rewards/payback and fee split works - I dislike it.
I typically have an outstanding balance in the 3-4 figures on my credit card because I pay for rent, gas, and airline tickets with credit. However, it gets paid off every month. I guess that's technically debt, but it's not problematic or anything...
I feel like the majority of credit card debt is the type of "debt" that I incur every month.