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Subject: I pay my credit card balance in full every month | |
Author: Oropan |
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Date Posted: 05:21:37 11/08/07 Thu In reply to: L. 's message, "Re: Creditcard debt" on 00:21:57 11/08/07 Thu I have never paid one cent of interest to a credit card company. In fact, I get cash back from them. > New Report Details How American Families Rely on >Credit Card Debt To Make Ends Meet Americans' credit >card debt grew by 315 percent--TO $876 Billion--Since >1989; Depleting Home Equity To Cope NEW YORK, NEW YORK >- November 7 - American families are using credit >cards to bridge the gaps created by stagnant wages and >higher costs of living and balances have grown >dramatically since 1989, according to a new report >published today by Demos. Borrowing to Make Ends Meet: >the Rapid Growth of Credit Card Debt in America >documents the disturbing trends in sky-rocketing >credit card debt, and also provides detailed data >based on age, race and income demographics. The report >discusses how these trends relate to the housing >market crisis and the increase in predatory and >sub-prime lending in the financial services sector. >Since "income volatility", or the rate of fluctuation >in family incomes, has almost doubled in the last two >decades while wages have remained flat, families have >turned to credit cards as a safety net in tough >financial times. As of 2004, when the most recent >Survey of Consumer Finances was conducted by the >Federal Reserve, three out of every four American >households had a credit card. The average debt among >households with balances is $5,219. In total, American >cardholders owe a staggering $876 billion on their >credit cards. "There's a common misperception that >families with credit card debt live beyond their >means," said report author and Demos senior policy >analyst Jose Garcia, "but the findings presented here >show that credit card debt is a serious and quickly >growing problem for millions of families who don't >have enough income to cover the basic costs of >living." Borrowing to Make Ends Meet shows how credit >cards aggravate the financial distress many households >now feel--as healthcare, education and fuel costs rise >and mortgage payments reset upward--by trapping >cardholders in a cycle of debt with unnecessarily >punitive fees and interest rates. Exorbitant charges >were not always the industry standard; deregulation in >the 80's and 90's enabled companies to raise rates far >in excess of the risk factor of unsecured debt. >Between 2004 and 2005, credit card issuers took in $8 >billion in fees alone. To cope with the rising >pressure of credit card debt, and after exhausting >other income and assets to meet unexpected costs, >America's families have turned to the equity of their >homes. Over the last six years homeowners have cashed >out a $1.2 trillion (2006 dollars) in equity, further >endangering their financial well-being. Faced with >limited or non-existent assets, rising costs, sluggish >wages, and increasing credit card debt, many Americans >live on the brink of financial ruin. Borrowing to Make >Ends Meet documents this reality by providing data on >credit card indebtedness by household income, >race/ethnicity, and age. KEY FINDINGS (all figures in >2004 dollars, unless otherwise noted):* Between 1989 >and 2006, Americans' overall credit card debt grew by >315 percent from $211 billion to $876 billion (2006 >dollars). * From 2001 to 2006, homeowners cashed out >$1.2 trillion (2006 dollars) in home equity, often in >an effort to cope with mounting credit card debt and >to cover basic living expenses. * Nearly six out of 10 >households with credit cards revolved their balances >in 2004. The average amount of credit card debt among >those households reached an all-time high of $5,219, >an increase of 89 percent from $2,768 in 1989. * From >1989 to 2004, the percentage of cardholders incurring >fees due to late payments of 60 days or more increased >from 4.8 percent to 8.0 percent. * In 2004, the >average credit card-indebted family allocated 21 >percent of its income to servicing monthly debt >compared to the 13 percent dedicated to debt payments >among all households. * In 2004, 46 percent of very >low-income (under $9,999) credit card-indebted >households spent more than 40 percent of their income >to pay off debt. * From 1989 to 2004, credit card debt >among very low-income households quadrupled from an >average of $622 in 1989 to $2,750 in 2004. * While >white households carry more credit card debt, African >Americans and Latinos have a higher percentage of >credit card-indebted households. In 2004, of those >with credit cards, 84 percent of African-American >households and 79 percent of Latino households carried >credit card debt compared with 54 percent of white >households. * Over 90 percent of African-American >families earning between $10,000 and $24,999 had >credit card debt. * Since 1989, Americans over 65 have >experienced the greatest increase in the amount of >credit card debt carried. The average balance for this >age group increased 194 percent from $1,669 in 1989 to >$4,906 in 2004. Borrowing to Make Ends Meet: the Rapid >Growth of Credit Card Debt in America argues for a >legislative overhaul to restore fairness in lending >practices with a proposed Borrowers Security Act. It >also urges Congressional leaders to address the >economic factors behind rising debt by promoting >increased savings, improving wages for working >families, strengthening the unemployment insurance >safety net, and tackling the problem of health care >costs and insurance. "Addressing the debt crisis is >long overdue," said Tamara Draut, Director of Demos' >Economic Opportunity Program. "Using credit cards as a >way to make ends meet should not be a part of everyday >American life. Neither should borrowing against your >house to cover credit card debt or to deal with rising >costs. It's time that policymakers recognize the full >context of the economic forces hitting the average >household today, and take innovative steps to provide >stability and opportunity to all families before this >credit crisis worsens." To view the full report, >Borrowing to Make Ends Meet: the Rapid Growth of >Credit Card Debt in America, visit www.demos.org. ### [ Next Thread | Previous Thread | Next Message | Previous Message ] |
Subject | Author | Date |
Hmm you did not have good enough credit to get a card before they started giving cash back . | Bev | 14:08:54 11/09/07 Fri |
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Re: I pay my credit card balance in full every month | L. | 18:17:22 11/11/07 Sun |
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