Kerby Anderson

Earlier this month the Federal Reserve reported that credit card debt for Americans hit $870 billion as of December. That makes it the largest amount ever. Obviously, credit card debt goes up in December because of shopping for Christmas, but this number is way above the credit card debt load in the past. Nearly 480 million credit cards are in circulation, which is up 100 million from a decade ago during the recession. Using credit cards to purchase items isn’t a problem if you pay off the credit card each month. Many Americans are not doing that. About 37 million credit card accounts had a 90+ day delinquency mark added to their credit report last quarter. That’s an increase of about two million from the fourth quarter of 2017. As I have mentioned in previous commentaries, credit card debt isn’t the largest debt owed by Americans. First is mortgage debt. Second is auto loan debt. Third is student loan debt. At least with some of the other debts, there are assets (like a house or car) attached to the debt load. Notice that credit card debt is increasing while the incomes for most Americans is also increasing. Economists point out that while incomes are growing, some costs are growing faster. Some of these fast-growing costs are items like medical costs and food purchased away from home. One other item of interest is the fact that older Americans (over the age of 60) are holding a significant portion of credit card debt. They account for about 30 percent of the total. My book, Christians and Economics, is now available in English and Spanish. In the book, I remind us of the dangers of debt. Proverbs 22:7 says, “The rich rule over the poor, and the borrower is a servant to the lender.” Don’t be enslaved by debt.