Since the third quarter of 2021, credit card balances have risen by $121 billion. That’s a 15% increase, the largest year-over-year jump in more than 20 years.
With the increase, Americans’ credit card debt stands just $2 billion below the record set in the fourth quarter of 2019, when balances stood at $927 billion. Thanks to rising interest rates, stubborn inflation and myriad other economic factors, it’s likely just a matter of time before credit card balances surpass the 2019 record.
Though balances aren’t quite at record levels yet, they’re still light years above the $480 billion seen more than 20 years ago in the first quarter of 1999.
The average Arizona family has more than $7,000 in credit card debt. This ranks Arizona in the top ½ of states when looking at total credit card debt.
Most families in Arizona should try and pay off their credit cards each month instead of carrying a balance over. Unfortunately, most people with an active credit card account don’t always pay their bills in full. More than half (53%) of all active accounts carried a balance in the second quarter of 2022, the most recent quarter for which we have data. That’s down 1 percentage point from the first quarter of 2022 and marks the first quarterly decline since the second quarter of 2021. Even with the recent increases, however, that percentage is still well below pre-pandemic levels. For example, 60% of active accounts carried a balance in the first quarter of 2019 before falling throughout 2020 to as low as 51% in the second quarter of 2021.
Interest rates in Arizona are high. For all credit cards, the average APR in the fourth quarter of 2022 was 19.07%. For cards accruing interest, the average in the fourth quarter of 2022 was 20.40%. For new credit card offers, the average today is 23.39% — the highest average rate in more than a decade.
If you are having a hard time paying your bills each month and fear you are running out of options please contact the law offices of Adam Rieth. Their team has helped thousands of Arizona families work through the financial issues and find relief with bankruptcy options. The team at www.adamriethlaw.com wants to help you today!