New Study Explores American Credit Card Debt

 Posted on May 19, 2014 in San Antonio Bankruptcy Lawyer

When you hear someone say that they have tens of thousands of dollars of credit card debt, the first thought is often that the person is a  frivolous spender. You may envision luxury cars and closets full of Louboutin shoes.

However, based on a report recently released by Demos, that is not the case. The conducted national survey was focused on low and middle-income American households. These two groups were divided based on key pieces of statistical milestones, and main difference between the two was that one group carried credit card debt while the other did not.

It was found that there were three main factors that contributed to the credit card debt.

•         Households that did not have health insurance used their credit cards for their medical needs. They were 20 percent more likely to have credit card debt;
•         Households that have children under the age of 18 were 14 percent more likely to carry credit card debt than those that did not have any children;
•         Households that had an unemployed person for more than two months were also 14 percent more likely to carry credit card debt as opposed to those where joblessness was not an issue.

The report basically states that credit cards are being used as a “plastic safety net” for things that were necessary to sustain the household. So contrary to popular belief, Americans carrying large credit card debt are not actually being irresponsible. In fact, they are merely using the resources that are available to them, even if those resources come with high interest rates.

In cases like this, it becomes harder and harder to recover once the debt starts to get out of control. If you find yourself in a spiral of debt that you have no way of paying, bankruptcy can definitely be an option. Contact a Texas bankruptcy attorney today to discuss your options to getting a fresh start.