There are a lot of factors at play when it comes down to these glaring problems with credit card debt. Many economists point to interest rates, inflation, and an increased cause of living. We also know that many consumers are relying on credit cards to supplement their income, and a large portion of the population is simply overspending.
we can assume that most credit holders are not going to see relief anytime soon from their lenders. Rate cuts are likely not coming until later this year… and credit card rates are always much higher than the Fed’s benchmark rates anyway…
But aside from those major contributing factors, there’s something that’s widely overlooked. A lot of the problems we’re seeing in this country surrounding debt are caused in part by a widespread lack of financial education. Most Americans don’t understand how a credit card’s APR works. They don’t understand how minimum payments and interest rates work in tandem to keep you in the debt trap. A 2023 survey by Clever found that 28% of card users don’t even know what their credit card’s interest rate is…
And financial education is the only cure. We have no control over interest rates, inflation, and the price of goods. The only thing borrowers can do is empower themselves and become armed with the information that will allow them to get out of this vicious cycle of mounting credit card debt.
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DISCLAIMER: I am not a financial adviser. I only express my opinion based on my experience. Your experience may be different. These videos are for educational and inspirational purposes only. Investing of any kind involves risk. While it is possible to minimize risk, your investments are solely your responsibility. It is imperative that you conduct your own research. There is no guarantee of gains or losses on investments.
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