A record number of consumers are making minimum credit cards payments as delinquencies also rise

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With credit card interest rates 50% higher than just 3 years ago, the strength of the consumer is getting doubtful.

Survey indicated 48% using CC for essentials

And balances over $10K on average

New York Fed survey for December found that the average perceived probability for missing a minimum debt payment over the next three months stood at 14.2%, tied with September for the highest since April 2020

When ivory towers fail to realize the ‘spending’ is due to inflation, not the perceived strength of the consumer.

Wow! pedojoe really handed President Trump the “best economy in the world”.™

Maybe it’s a good time to be looking at foreclosures in the real estate market again.

I know I’ve changed some habits due to inflation, and I have high income and no debts. I totally believe plenty of folks are going month to month on CCs and are one missed paycheck away from bankrupt

Only now do the legacy media outlets notice the problems in the economy.

Must be Trump’s fault, right? /s

Survey indicated 48% using CC for essentials

I can see that. In our financial small group I often hear about people using CC's for normal spending and paying it off every month. I tell them that's fine, as long as they don't spend more because it's on a CC than they would if it was cash. (It's not enough to just pay off the CC every month. Make a budget and make sure you don't spend past your budget if you have other long term financial goals that extra money should go to.)

And balances over $10K on average

What in tarnation? That makes less sense than a Muslim marrying a grown woman.

Ditto with me. I avoid debts like the plague.

So with many (most?) cards now heading towards 30% interest rates, why has no one at the CFPB actually started protecting consumers?

While we should have no debt, in real life bumping interest rates from 14% to 30% is just a killer for most families.

And checking account interest rates hover at 0.25% ...

Again, let me take $100k out of my IRA tax-free so I can pay off my mortgage.

If Biden can forgive college loans two can play this game.

Outside of medical bill emergencies I’ve never understood how people can get themselves jammed up with credit card debt.

We have one card and use it very sparingly......if it gets around $500 we start panicking. Lol!

Forgiving student loans freed up so much income that they can pay down their credit card balances.....no, wait.....

Forgiving student loans was just the trial run to forgiving credit card debt.

22% are using their credit cards for essentials and making only minimum payments at average 21% interest. Figure that interest rate into the cost of living and the inflation number looks way worse. This has been building steadily since 2021. The media obdurately refuses to acknowledge how much trouble we are in, preferring to spew whatever narrative the government feeds them.

There are a wide variety of different situations—but folks who have high “fixed costs” and then get laid off can get in financial trouble in a hurry.

In most cases they did not save enough for a rainy day and then the rainy day happened.

Zero. Zip. Nadda. Nilch. I gave up on the society’s demand that I need to borrow money for things.

“Outside of medical bill emergencies I’ve never understood how people can get themselves jammed up with credit card debt.”

auto repair shops know how

“a good time to be looking at foreclosures in the real estate market again”

I’ve been watching a lot of YouTube about what’s going on in the auto industry right now.....apparently 1 of ever 5 auto loans are defaulted on and the vehicle repossessed.

The average monthly payment on a new car is $700+.....that’s insane.

” now heading towards 30% interest rates, why has no one at the CFPB actually started protecting consumers?”

One of the major reasons I distrust Democrat protestations of love for ordinary people is high interest rates on consumer debt.

What the Congress could do is to cap interest rates on debt:
1. first $2,000, 18%,
[this would allow low-income people to finance car repairs on a credit card]
2. second $2,000, Treasury rate+5%, rounded up to an integer percentage, as last officially reported by the Treasury as of the start of calculation period,
[this would keep the credit card industry attractive]
3. any additional amount, Treasury rate+4%, rounded up to an integer percentage, as last officially reported by the Treasury as of the start of calculation period.

Any attempt to dodge any cap by additional instrument or by dividing the debt held shall be considered nefarious.

Any attempt to dodge any cap by nefarious means shall be void and all related interest shall be disallowed and refunded.

“In most cases they did not save enough for a rainy day and then the rainy day happened”

Among all the invaluable life lessons my parents taught me was that of you can’t afford to buy it with your own money......DO WITHOUT.

Most people don’t have that kind of discipline nowadays.