'Tis the season to be... burdened by debt?
24% of Americans still have holiday debt from 2022
Photo: Unsplash
Hello Financial Healers,
A recent WalletHub survey caught my attention. According to its report, “nearly 1 in 4 Americans still have holiday debt from last year.”
Say what?!
Christmas is supposed to be a time of peace, but the data reveals a disturbing reality. Consider these stats: 👇
Photos: WalletHub
These figures not only point to a weak economy… they uncover America’s consumer debt crisis. Ted Rossman, Bankrate's senior industry analyst, states:
“Even a more modest $1,000 balance (from last year’s holiday gifts, perhaps) would keep someone in debt for 40 months and cost them $390 in interest if they only make minimum payments at [the current average rate of] 20.72%.”
I’ve said it before that having debt is not evil, but having debt is a form of bondage. The question becomes: “How much bondage are you willing to live with?”
In Ted Rossman’s case, 40 months of repayment is over 3 years in a person’s life. Those numbers only increase as more charges get added to unpaid accounts.
Unless Americans make drastic changes coming in to 2024, this next year is going to be uncomfortable. Many middle class families, who have used credit cards to cover living expenses, are about to see their chickens come home to roost, and it won’t be pretty.
Michael Snyder, who is a bit more doom and gloom than I usually like, makes some interesting points about America’s consumer debt:
In a desperate attempt to maintain their middle class lifestyles, millions upon millions of Americans have been taking on debt like never before, and as a result we are now facing an unprecedented consumer debt bubble…
Snyder’s post goes on to say, “A credit crunch has begun, and it is only going to intensify in the months ahead.”
I know it’s tempting to use credit cards in this season, but try to avoid gaining more debt. Instead, tighten up your spending. Get disciplined with your payment plans.
Surplus and blessings will arrive, but you must master your money now, so you won’t slide back into bondage through poor decision making.
God bless your Prosperous Soul,
Stephen K. De Silva
About: Stephen K. De Silva is an author, speaker, and financial coach. From 1995 until 2017, he served as the CFO of Bethel Church, and a member of the senior leadership team. Stephen’s blend of experience, training, and gifting make him a pioneer in the subject of money. You can reach Stephen at hello@prosperoussoul.com