The New York Federal Reserve reports that, collectively, Americans have over $830 billion in credit card debt. This number may be staggering to some, but others may not be so surprised. After all, there are many reasons why people in New Hampshire and nationwide are relying on credit cards, even if it is to their detriment.
For example, a survey conducted by Experian revealed that more than four out of every 10 respondents reported that they use credit cards as a means of paying for unexpected, emergency expenses. This may be because many people live paycheck-to-paycheck and do not have enough in savings to pay for an emergency. In fact, 40 percent of individuals in the United States have under $400 in savings. However, a Pew poll revealed that despite that, 60 percent of those polled reported suffering a financial emergency over the past year, the median cost of which amounted to $2,000.
In addition, some people must use credit cards to meet their daily living expenses. The Experian survey revealed that 68 percent of respondents reported using credit cards to purchase necessities. Moreover, data from the Pew Research Center reveals that wages aren’t growing. In fact, the average wage in 2018 has the same purchasing power as it did 40 years ago. Wage increases are, in general, going to those who already make a high income, rather than to the average worker.
This information reveals just how serious credit card debt is in our nation. Fortunately, those who are overburdened by credit card debt do have options. One of these options is filing for Chapter 7 bankruptcy. Through Chapter 7 bankruptcy, a person’s assets are liquidated and the proceeds are then used to pay off the person’s creditors. Following that, much of a person’s remaining debts, including credit card debt, are extinguished. This allows the debtor to move forward on a fresh financial foot. Those who want to learn more about Chapter 7 bankruptcy can seek professional guidance, so they can determine if this form of debt relief is right for them.