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2mo ago

U.

Rising delinquencies and high interest rates highlight growing financial strain for American households.

Traffic moves along a freeway as vehicles travel towards Los Angeles, California, U.S., March 22, 2022. REUTERS/Mike Blake/File photo
A car dealership in Alhambra, California, on June 27, 2024.
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Overview

  • The Federal Reserve's latest report shows U.S. credit card debt hit a record $1.21 trillion in the fourth quarter of 2024, part of a broader $18.04 trillion in total household debt.
  • Serious delinquencies on credit card accounts rose to 7.2% in Q4 2024, the highest rate since 2011, though the growth in delinquencies has recently stabilized.
  • High interest rates, averaging 23%, make managing credit card debt increasingly difficult, especially as more Americans rely on credit for everyday expenses amid inflation.
  • Debt management solutions like consolidation loans, balance transfers, and credit counseling are being recommended to help consumers regain financial stability.
  • Experts warn that unresolved credit card debt could further strain household finances, emphasizing the need for proactive repayment strategies.