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Studies differ on average amount of debt

New Jersey residents may be interested in hearing the results of several new studies on the amount of credit card debt people carry. According to a survey conducted by one financial services website, the average American household carries around $7,000 in credit card debt. However, for people who consistently have a balance on their credit card, the average amount is $15,000. This study analyzed statistics compiled by the government.

A study carried out by another company found slightly different results, concluding that the average credit card debt is closer to $11,000. Meanwhile, a third study found that American households have an average of around $7,000 of indebtedness. The statistics differ because not all people who have credit carries carry a balance. Others may pay the balance off every month.

Most credit cards carry high interest rates. Those who want to eliminate balances on multiple cards may try to work on paying off the card with the highest interest rate first while still paying the minimum amount on the others. Another approach is to try to pay off the card with the lowest balance first and leave the card with the highest balance for last.

Consumers who have more credit card debt than they are capable of paying may consider filing for bankruptcy. Filing for Chapter 7 bankruptcy can help a person eliminate credit card debt through a discharge of most unsecured indebtedness. This form of bankruptcy is ideal for people who own little property and do not make much more than they spend on living expenses. For people who own a significant amount of property, Chapter 13 bankruptcy may be a better option. It provides for a consolidation of obligations into a manageable payment program over a period of three to five years.

Source: Daily Finance, “Is Your Credit Card Debt Average? And What’s Average?“, Michele Lerner, June 11, 2014

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