A growing number of people in Virginia are facing escalating credit card balances. According to the New York Federal Reserve, younger Americans traditionally steered clear of credit card debt. Many millennials came of age during the financial crisis in 2008 and became more thrifty as a result. However, credit card delinquencies for 90 days or more have risen the most among younger Americans. For people age 18 to 29, these types of delinquencies reached 8% of all credit card balances in the first quarter of 2019.
These statistics reflect a changing approach to credit card debt as well as changing approaches by credit card issuers. Card companies have found that generous signup bonuses and travel credits are more effective in attracting younger consumers than ongoing cash-back or no-interest programs. In addition, consumer debt is rising at the same time that the Federal Reserve is hiking prime interest rates. While an increase in federal rates is not directly linked to consumer credit interest rates, it generally accompanies and influences the rates of a range of consumer products.
In general, people in this age group have the greatest amount of overdue payment amounts. Experts said that the overall growth of the U.S. economy may lead people to take on more debt, which then becomes difficult to repay when personal situations change. In addition, it can be particularly difficult to escape the trap of credit card debt due to high interest rates.
People who are facing a growing credit card debt burden may be unsure how they can find a way out of their situation, especially if they have also gone through job loss, illness or other challenging circumstances. Personal bankruptcy might offer new possibilities for a changed financial future, and an attorney may provide advice and guidance on options to seek debt relief.