Pennsylvania consumers can use credit cards without building debt. But many of them do carry balances over from month to month and accumulate high balances. Many people may suspect that younger, inexperienced credit card users are more likely to carry credit card debt. However, according to a recent survey from CreditCards.com, this is not true. If this poll is accurate, Generation Xers and younger Baby Boomers are much more likely to let their credit card balances slide for two years or more. Also, Pennsylvania credit card users who make more than $50,000 a year are more likely to build and carry credit card debt. These revelations are disturbing. Why? Most credit pros agree that the longer a balance lingers and accrues interest, the harder it is to pay off. Also, when credit cards are mismanaged long enough, even a higher income won’t necessarily save a credit score.
Signs Indicating that Many Pennsylvania Consumers Use Credit Cards to Live Beyond Their Means
The CreditCards.com study reveals that 28% of consumers in Pennsylvania and throughout the country do not pay their credit card bills in full every month. Then, out of these credit card users, 43% admit to carrying balances for two or more years. Breaking down the poll results by consumer age, these are the percentages of card holders who routinely carry balances.
Millennials – 26%
Generation Xers – 36%
Baby Boomers – 33%
Members of the Silent Generation – 19%
It also appears that college-educated people in Pennsylvania are more likely to build credit card debt than those with less education. In addition, affluent consumers who make $50,000 to $75,000 or more typically carry credit card balances more often and longer than those who make $30,000 a year or less. Why?
In response to this question, qualifying survey participants named vacations and home improvement expenses as the main reasons for racking up credit card debt. Unfortunately, these poll results may serve as signs that a lot of Pennsylvania credit card debt is unnecessary. Instead of using credit cards as credit building tools, even consumers with substantial incomes use their available credit to fund things that these incomes can’t support.
How Pennsylvania Consumers Can Pay Down Credit Card Debt and Save their Credit Scores
Building and carrying high credit card balances is dangerous to credit scores in two ways. First, if your credit utilization rate is consistently at 30% or more, your credit score can drop. This is because potential lenders see heavy credit card use as a sign of financial instability.
Next, heavy credit card debt often comes with substantial interest charges. At a certain point, balances just keep growing. Of course, most Pennsylvania consumers can handle their credit card bills as long as everything runs smoothly. Yet, if they lose their job or suddenly incur a large medical bill, they run the risk of missing payments or even defaulting. If the worst happens, and credit card accounts go to debt collections, credit scores plummet and debt collectors start calling.
In order to protect their finances and credit scores, Pennsylvania credit card users with high balances should do the following.
- Rework existing budgets to set aside more money to put toward credit card payments. Then, set up an emergency fund to cover bills in case of a financial emergency.
- Pay down high credit card balances until only 30% or less of spending limits are used. Then, limit credit card spending to keep balances within the target range.
- Consider transferring balances to a 0% interest credit card if credit score is good enough to qualify. Then, work to pay off card as quickly as possible.
In addition, all Pennsylvania credit card users should regularly check their credit reports. This allows them to check for signs of identity theft, which, after the Equifax data breach, is a bigger threat than ever. Monitoring your credit reports also gives you the opportunity to look for errors caused by creditors and the credit bureaus that can hurt your credit score.
The Free and Legal way to Get Better Credit
If you find suspicious or inaccurate items on any of your credit reports, contact Credit Repair Lawyers of America in Pennsylvania. We will provide you with an experienced credit attorney who will handle the disputing process for you and get you clean credit reports for FREE.
Don’t let fraudulent accounts or errors on your credit reports bring your credit score down. At Credit Repair Lawyers of America, we’ve been cleaning up credit reports for consumers since 2008 for free. How do we do it? The law allows us to collect our fees and costs from the defendants in any successful action. This is why our clients pay nothing for the work we do.
Let’s start the conversation about what we can do for your credit. Set up your free consultation today by calling Attorney Gary Nitzkin at (856) 912-3511 or sending him a message through our contact page.
For more information about Free Credit Repair, please visit https://creditrepairlawyersam.com/pennsylvania/credit-repair/. Or, to learn more about Free Credit Repair After Identity Theft, check out https://creditrepairlawyersam.com/pennsylvania/fix-identity-theft/.