DEBT STATISTICS

DEBT STATISTICS
If you are not carrying any problematic debt, consider yourself fortunate – conversely if you have debt
troubles, you are not alone. The following are some eye-opening statistics that may be interesting to
you, and that illustrate the debt epidemic in our society:
• The average American household with debt carries over $9,000 worth of debt and has 9
credit cards.
• The average interest rate on these cards is over 14%.
• About 20% of all credit cards are "maxed out" by their owners.
• Unlike mortgages, there are no usury laws for credit card debt. The highest rate that a
mortgage lender can charge is around 13% (8% over the Prime Rate). When you miss a
credit card payment, however, your interest rate can go up to 30% (or more!)
• 70% of households are living paycheck to paycheck (Wall Street Journal).
• The average American spends $1.22 for every dollar they earn.
• About 80% of young Americans aged 18-20 have credit cards; Teenagers spend $150
billion each year.
• Between 1983 and 2001, credit card debt for 25-to-34 year-olds nearly tripled, according to
the Federal Reserve.
• 95% of American families argue about money related topics on a regular basis.
• Less than 30% use a written monthly budget to manage household finances.
• There were roughly five billion credit card offers mailed in 2004 to approximately 200 million
individuals in the US. This means the average individual received about one offer every
other week. The average household received more than one per week.
• There are about 40,000 different credit card products available in the USA.
• Americans shelled out more than $24 billion in credit card fees in 2004, an 18% increase
over the previous year.
• From the New York Times: “Over the years, MBNA (a large creditor) accumulated a fleet of
airplanes, helicopters, yachts and expensive cars, as well as a $65 million art collection…”
and MBNA’s CEO paid himself “among the nation's highest, topping $50 million in each of
the two previous years.”
• 1.8 million personal bankruptcies (individual and joint) were filed in fiscal 2005, equating to
over 2 million cardholders.
• If you have $20,000 in credit card debt, your minimum payment on that debt will be about
$600 to $800 per month. If you did not have this credit card debt and instead invested $800
per month into an investment earning a 10% APR, in approximately 18 years you would
have saved over half a million dollars!

source: www.bills.com