ARE SET TO MAKE IT WORSE. BUT THERE ARE WAYS TO GET OUT OF THAT HOLE. BRIAN CHUNG REPORTS. >> Reporter: WITH THREE WEEKS TO GO, THE HOLIDAY RUSH IS WELL UNDERWAY. WITH EVERYTHING NEARLY 8% MORE EXPENSIVE THAN LAST YEAR, SHOPPERS ARE PAYING WITH PLASTIC TO BUY GIFTS THIS HOLIDAY SEASON. >> YEAH, I GOT SOME THINGS OFF OF AMAZON. I GOT A KARAOKE MACHINE FOR ONE OF MY DAUGHTERS. AND I GOT MY SON A BIKE. >> Reporter: WITH THOUSANDS OF DOLLARS IN DEBT, THE MOTHER OF THREE NOW FACES A SERIOUS CHALLENGE. >> I THINK IT'S KIND OF AN OUT OF SIGHT, OUT OF MIND KIND OF THING. >> SHE'S NOT THE ONLY ONE. JAMIE FELDMANN WAS ONCE $20,000 IN DEBT. >> EVERY TIME YOU DO A MINIMUM PAYMENT, THE NEXT MONTH, IT'S LIKE YOU DIDN'T PAY ANYTHING WITH THE INTEREST AND THE FEES. I'M JAMIE. >> Reporter: FELDMANN POSTED STORIES ON TIKTOK, ENGAGING OTHERS IN SIMILAR SITUATIONS. >> THERE WAS SOME MISMANAGEMENT OF MONEY.
>> Reporter: AMERICANS ARE HEADING INTO THE PEAK HOLIDAY SHOPPING SEASON WITH RECORD DEBT AS THEY BUY THINGS LIKE DEBT OR EVEN CHRISTMAS TREES, BUT THEY ALSO FACE RECORD HIGH INTEREST RATES IF THEY MISS A PAYMENT. >> CREDIT CARD DEBT HAS SOARED TO RECORD $866 BILLION AND THE AVERAGE INTEREST RATE NOW NEARING 20%. AT THAT RATE, MAKING MINIMUM PAYMENTS ON A $1,000 BILL WOULD TAKE OVER NINE YEARS TO PAY OFF, WRACKING UP ABOUT $990 IN INTEREST. >> I GOT A LOT OF EMAILERS FROM THE CARD ISSUERS JUST STATING THAT THE TERMS HAVE CHANGED, AND NINE TIMES OUT OF TEN, IT'S THE INTEREST RATE THAT'S INCREASING.
>> IT HASN'T STOPPED YOU FROM SPENDING THE WAY THAT YOU'RE SPENDING? >> NO. ONLY BECAUSE I FEEL, LIKE, PRESSURE TO, YOU KNOW, HAVE A GOOD CHRISTMAS FOR MY CHILDREN. >> Reporter: EXPERTS RECOMMEND PRIORITIZING 0% BALANCE TRANSFER CARDS AND CONSOLIDATING YOUR DEBT. >> IF THIS DESCRIBES YOU, NO SHAME. YOU HAVE PLENTY OF COMPANY. BUT LET'S FOCUS ON BRINGING THAT INTEREST RATE DOWN. >> Reporter: THERE'S OTHER STRATEGIES TOO. THIS HANUKKAH, JAMIE IS JUST FOCUSED ON SPENDING QUALITY TIME WITH LOVED ONES. >> THIS YEAR IT'S .
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.
HERE'S TOM COSTELLO. >> Reporter: IN COLORADO, THIS WOMAN AND HER HUSBAND ARE ON A MISSION — TO KEEP SPENDING DOWN AND PAY OFF THE LAST OF THE $15,000 IN CREDIT CARD DEBT THEY RAN UP AFTER GETTING MARRIED. >> WE WANT TO BE ABLE TO BUY A HOUSE. WE DON'T HAVE A HOUSE YET. AND WE'RE IN OUR 30s. THAT'S HARD. BUT IT'S BECAUSE WE HAVE CREDIT CARD DEBT THINKING WE WOULD BE ABLE TO PAY IT OFF. >> Reporter: NEW DATA SHOWS MANY AMERICANS ARE CHARGING IT. CREDIT CARD DEBT JUMPED 13% IN ONE YEAR. THE BIGGEST INCREASE IN 20 YEARS. AND AMERICANS OPEN 233 MILLION NEW ACCOUNTS, THE MOST SINCE 2008. BALANCES STILL REMAIN BELOW PREPANDEMIC LEVELS, INTEREST RATES NOW AVERAGING 17.4% COULD SOON SOAR TO RECORD HIGHS. AS THE FED CONTINUES HIKING RATES TO FIGHT INFLATION. IF YOU'RE CARRYING HEAVY CREDIT CARD DEBT, FINANCIAL EXPERTS RECOMMEND CUTTING IT DOWN AS FAST AS POSSIBLE. >> THAT RATE IS PROBABLY THREE, FOUR, FIVE TIMES WHAT YOU'RE PAYING ON YOUR MORTGAGE OR CAR LOAN. THE SO DEFINITELY YOU WANT TO BE PAYING DOWN THE CREDIT CARD DEBT. >> Reporter: TRANSFER BALANCES TO CARDS OFFERING 0% RATES.
WILL TURN TO NONPROFIT FINANCIAL COUNSELLORS FOR HELP. THE WHITE HOUSE TODAY NOTING SOME INFLATION RELIEF WITH GAS PRICES NOW AVERAGING $4.16 A GALLON, DOWN 85 CENTS FROM THE RECORD HIGH SET IN JUNE. EXPERTS SAY GAS COULD FALL BELOW $4 A GALLON SOON THOUGH THE .
