U.S. Credit Card Debt Approaches $1 Trillion
According to a new study, credit card debt in America reached $917.7 billion at the end of 2015. This is a $71 billion higher than 2014.
Much of this debt can be attributed to the fourth quarter of 2015. Americans incurred $52.4 billion in credit card debt during that quarter alone – the largest fourth quarter figure since 2008. That is 42% higher than the average fourth quarter during 2009-2014. The end of the year always has the highest volume of credit card debt because of the holiday season, but the volume was particularly high last year.
2015 was the first year that online holiday sales surpassed in-store sales for Black Friday weekend. This could have played a role in the big leap at the end of the year as more Americans used their credit cards to shop online. Many stores chose to kick off Black Friday sales on their websites on Thanksgiving Day, resulting in $4.45 billion in transactions on Thursday and Friday alone.
The average household in the United States now has $7,879 in credit card debt, only $500 below what is considered to be an “unsustainable” amount of debt. Delinquency rates could begin to increase, putting Americans even further into overwhelming financial situations.
During the first quarter of 2015, Americans were able to pay back nearly $35 billion in debt.