ATLANTA — More people are getting into credit card debt this summer.
Channel 2′s Linda Stouffer spoke with a financial expert who explained how to handle being in debt.
More Americans are now carrying over a credit card balance from month to month and those balances are going up.
“The average credit card charge is 20.73%, which is very close to a record high. I see a lot of cards though, at 25%, 30%, sometimes more. The worst offenders usually store credit cards. Most of those are over 30%,” Tedd Rossman of Bankrate said.
Rossman says to tackle that first.
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‘My favorite tip is to get a 0% balance transfer credit card. This involves taking your existing high-cost debt from one or more cards and moving it over to a new card with a generous 0% promotional rate,” Rossman said.
Rossman also says it is important to pay more than the minimum payment.
‘The minimum payment math is really brutal,” he said. “I mean, if you have that average balance of about 6300 bucks and you make minimum payments at roughly 21%, you’re in debt for 18 years and you have to pay $9,500 in interest.”
Cut expenses and see what subscriptions you can cancel for now.
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“Maybe you take on a side hustle. it doesn’t have to be forever. but if you do that, even for six months, you can make a really meaningful difference. We found that the average side hustler makes almost $900 a month, so that can be meaningful,” Rossman said.
Data shows inflation is slowing down making it more likely the Fed will start to lower interest rates.
That will eventually help with consumer debt and mortgage rates are dropping already.
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