Credit Card Debt Spikes As Inflation Rises


NBC NEWS SENIOR BUSINESS ANALYST STEPHANIE RUHLE NOW ON THE RISE OF CREDIT CARD DEBT. >> Reporter: ACROSS THE COUNTRY, PEOPLE ARE PAYING MORE FOR EVERYDAY EXPENSES. >> FRUIT, PAPER GOODS, ENGLISH MUFFINS, EVERYTHING. EVERYTHING. I'M BLOWN AWAY. >> I USED TO HAVE SAVINGS. I DON'T HAVE IT ANYMORE. >> Reporter: MARIE DiMASCIO SEAS IT EVERY TIME SHE SHOYRNGS WAIT, THAT WASN'T LIKE A YEAR AGO. >> Reporter: A PODCASTER LIVING IN NEW YORK CITY, OVER THE LAST YEAR, SHE HAS BEEN USING HER CREDIT CARD MORE OFTEN, AND IT'S ADDING UP. ARE YOU PAYING DOWN ANY OF THIS CREDIT CARD DEBT? >> I WAS PAYING THEM DOWN, BUT I'M CURRENTLY JUST DEALING WITH IT AS WE GO.


>> Reporter: MARIA IS LIKE MANY AMERICANS, TURNING TO CREDIT TO GET BY. IN FEBRUARY, CONSUMER DEBT ROSE MORE THAN $40 BILLION, A JUMP OF MORE THAN 11%. THE HIGHEST IN MORE THAN TWO DECADES. CREDIT CARD DEBT IS UP NEARLY 21%. >> THESE BALANCES HAVE BEEN RISING FOR A FEW REASONS. INFLATION IS A BIG ONE. BUT I WOULD ALSO NOTE HIGHER CONSUMER SPENDING IN GENERAL AND THE DIGITIZATION OF PAYMENT. PEOPLE ARE USING LESS CASH. >> Reporter: DURING THE PANDEMIC, GOVERNMENT AID POURED INTO AMERICANS' BANK ACCOUNTS. MONEY THEY'RE NOW USING TO PAY THEIR CREDIT CARD. >> PERSONAL SAVINGS INCREASED BY ABOUT $2 TRILLION. WE STAYED HOME AND LOADED UP ON HOME RENOVATIONS AND NEW TVs. NOW PEOPLE ARE STARTING TO SHIFT, AND IT'S MORE ABOUT PLANE TICKET, MEALS, EVENT TICKETS, THINGS LIKE THAT.



>> Reporter: BUT FOR SOME, CREDIT CARD BILLS ARE GETTING HARDER TO KEEP UP WITH. AND EXPERTS SAY IT'S IMPORTANT TO ACT NOW SO YOUR DEBT DOESN'T GET OUT OF HAND. THEIR ADVICE, APPLY FOR A ZERO PERCENT TRANSFER BALANCE CREDIT CARD. NEGOTIATE WITH YOUR CREDIT CARD COMPANY, OR CONSOLIDATE YOUR DEBT WITH A LOAN THAT HAS A LOWER INTEREST RATE. WHILE MANY ARE STILL ABLE TO PAY THEIR CREDIT CARD BILLS ON TIME, EXPERTS WARN THAT COULD EASILY SHIFT. >> WE CAN'T GO THROUGH THAT MANY MORE MONTHS AND CORRIDORS OF THIS VERY, VERY HIGH INFLATION WITHOUT SOMETHING BREAKING. EITHER A RECESSION AT SOME POINT OR MORE.



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