you are such an ass. I have 2 cards and pay off the balance every month. does that amke me un-american? Why pay interest?
i wonder how reliable these credit card debt stats are. nobody under the age of 60 uses checks any more. as such, there are a lot of people, like you an i, who have much larger credit card balances intra-month than we would have years ago; yet, in reality, we have no credit card debt, as we pay them off monthly. because of billing cycles, my credit report will often show me having thousands of dollars of credit card 'debt', which is an inaccurate snapshot of my exposure. granted, i tend to think CC delinquencies will become a problem as many have lost access to their home equity atm lotto ticket. i just think that stats showing % of 30 or 60 day late are more useful than a raw #, given the reasoning i laid out above.
My impression is that the credit card story is not at all unlike the mortgage story. The "prime" borrower, which you guys clearly are, is a sure bet to repay. The "sub-prime" borrower, which is a growing percent of the population will probably default within the next few years. My guess is that the media has its hands full with the sub-prime story since it has knocked Wall St. sideways. The credit card story has been going on for decades, it's just that inflation was a tamer animal in years past. With skyrocketing inflation in essentials, the shrinking middle class has or will hit the brink soon enough and those credit card portfolios will be a bloodbath within the next 1-3 years. You can bet on it.
Good Point. Many people build up their credit card balance to get rewards/cash back (theses programs have exploded in recent years), and then pay them off in full each month. Its an interest free loan, plus you can get extra money back from them. Of course this is partially offset by idiots who charge more than they can afford, but I wouldn't think thats anything new.
Why would someone have credit card debt if the had the money to pay it off monthly? I highly doubt raises in income are moving the same rate as credit card debt either. You write things as if you just nailed a great point but can you explain how you come about your statement. Also charging and paying it off at the end of month is not credit card debt to you correct?
how did you convince your boss to give you a raise, you gave him some of your good stock tips, didn't you?!
The scuttlebutt is that many people have run up their CC debt as a last resort to avoid foreclosure. Obviously the piper must be paid eventually.
actually, there was a rather large survey done (sorry, no link) which said the opposite. people were asked if, given a choice between paying their credit cards or mortgage, which would they pay- it was like 3:1 for credit cards! think about it- if you're under water on your mortgage, house declining in value, and you can't pay the reset from 2.9% to 7 or 8%.... you'll walk away and rent if you must. if you fuck up your credit card relationships, then you're double screwed. that siad, again, i feel that many people live beyond their means. watching the delinquency rates will be telling. prolly not a massive problem unless we have 6 months + of job losses- we're not at that stage.
I think if youâre underwater and not paying your mortgage itâs a mood point credit is shot. I get your logic though just not sure if it matters.