Consumer debt surpassed $14 trillion in the beginning of 2019, and it’s a trend that’s showing little signs of slowing down. Home mortgages, student loans, credit cards, payday loans, home equity loans, personal loans, car loans — it seems there’s no shortage of ways to dig yourself into a financial hole.
credit card debt
Credit card debt left unchecked can significantly hamper your efforts toward securing a comfortable retirement. Instead of contributing to your 401(k), you end up forking out precious dollars toward interest payments on revolving credit lines each month. Having an actionable debt pay-down plan can make the difference between a relaxing retirement and feeling the pinch.
A report by Federal Reserve economist Joanna Stavins combined Equifax data with the 2015-2016 Federal Reserve Bank of Boston’s Survey of Consumer Payment Choice (SCPC) on how consumers pay for purchases. Comparing self-reported measures with objective data, she found that people tend to have fewer credit cards with higher limits than they report.