On behalf of Law Offices of Mark M. Kratter, LLC on June 26, 2012
Consumers in Connecticut and across the country responded to the economic recession by slashing their credit card debt. According to a recent survey, the number of families with a card balance fell sharply between the years of 2007 to 2010. The survey reports that, as of 2012, only 39.4 percent of families carry a credit card balance, down from 46.1 percent in 2007. While this improvement is certainly welcome, paying off credit card debt is not a realistic possibility for everyone.
The study also documented that families headed by an individual at least 75 years old had a higher likelihood of carrying credit card debt after the recession occurred. And families headed by individuals with no high school education also were more likely to rely on credit cards now. While most demographic groups showed headway in managing credit card debts, a couple of groups did not fare as well because of drops in income. Families living in the South and West regions of the United States sustained a huge drop in income, in addition to plunging home values.
Interestingly enough, families headed by college-educated individuals were more likely to carry debt on their credit cards than those who dropped out of high school -- even though use of credit cards by those with no higher education has increased overall. Not surprisingly though, is that families headed by single parents were more likely to rely on credit cards. According to the study, retirees are seeing more credit card debt after 2007 thanks to the recession as well.
Not everyone has the ability to pay off their credit card debt every month. Many Connecticut families are still struggling with job losses and significant drops in income. For those families, bankruptcy protection could be a viable option. Filing for bankruptcy could help them get a chance to start over with a clean financial slate.
Source: Fox News, "Fed Survey: Recession Shrank Card Debt, Crushed Household Wealth," Kelly Dilworth, June 13, 2012
