The nation's economy has recently been moving in a positive direction. This is a good sign for many Tennessee residents. However, there are many consumers throughout the country that continue to be burdened with substantial credit card debt. Reports from a lending exchange company show that over 40 percent of those with debt from credit cards were only using them to keep up with monthly expenses. Experts suggested some issues that consumers may use to break this cycle of debt and get a better handle on their finances.
Most Tennessee consumers are likely carrying more credit card debt than they were before the holiday season. In fact, across the United States, credit card debt is currently the highest that it has ever been, and some experts are worried. Although many people seem to be managing their debt well enough, soon-to-rise interest rates and lower income consumers may struggle to repay what they owe.
Numerous young adults in Tennessee and around the country are deep in debt. Some experts predict that many of these young people are not expected to pay off the huge tabs that they are creating. Part of the problem may be that many of those who are burdened with overwhelming credit card debt are also facing or will face hefty student loan debt. Despite the fact that student loans are usually not dischargeable in bankruptcy, many people cannot even consider paying student loan debt when they are burdened with overwhelming unsecured debt.
According to the Federal Reserve, American consumers collectively owe nearly $1 trillion in credit card debt. Another survey found that individuals carry an average of $7,000 on credit cards. The reasons behind these high credit card debt loads are complicated, and no two Tennessee residents share the exact same set of circumstances.
A recently published article looks at common money management errors people make at different stages of life. For many in Tennessee, credit card debt is definitely on that list. Unsurprisingly, credit card debt was also featured in the recently published article.
Tennessee residents encounter escalating debt for a number of different reasons, many of which lie beyond their control. When credit card debt mounts, the manner in which a consumer responds will shape the outcome. Knowing how to respond to ongoing credit card debt struggles is important, and can prevent a negative financial outcome.
Struggling to overcome high levels of debt can feel overwhelming for Tennessee residents. That is especially true when debt collectors begin calling. While there are regulations in place to limit the tactics that debt collectors may use, many companies operate outside of those established boundaries. Understanding how to handle interactions with credit card debt collectors can make it far easier to work through times of financial turmoil.
Faced with overwhelming levels of debt, many Tennessee residents are unsure how things got so out of control. It is not uncommon for a borrower to sit down to review the full scope of his or her credit card debt and have little understanding of how that money was spent, much less have much to show for it. A recent article takes a look at how the human brain processes financial information, and suggests that humans may simply lack the ability to fully comprehend the concept of credit.
For many Tennessee residents, going through a divorce can lead to serious financial problems. To begin, simply having to operate two households with the same income that previously covered one will put a squeeze on the finances of both parties. Then there is the matter of property division to consider. The division of marital wealth leaves both parties holding a portion of accumulated assets. Just as assets are divided, so is debt, leaving some newly divorced residents with high levels of credit card debt, and very little to show for it.
Economic turnarounds usually motivate American consumers to spend more. The end of the Great Recession of 2008 was no different from other recoveries. The good news is that buying habits are reverting to pre-recession levels. The more troubling news is that purchases are being put on plastic.