How’s that credit card balance looking lately? If you have followed the national trend, it’s looking better than it did in 2008 and 2009 — but it’s slowly inching upward again, according to CardHub.
The 2013 Credit Card Debt Study shows that U.S. consumers went a bit crazy in the fourth quarter of 2013, which resulted in a $38.2 billion net increase in credit card debt nationally.
Context is extremely important when it comes to evaluating credit card debt trends, CardHub CEO Odysseas Papadimitriou said of the report’s findings. One could easily come to the conclusion that 2013 was a healthy year for consumer spending given the fact that outstanding credit card debt increased only $10.4 billion while defaults fell 16.7%. But that would fail to take into account the $27.7 billion that we defaulted on, yet still owe. As has been the case in recent years, the first quarter of 2013 was the only one in which we paid down debt.
Here’s a closer look at the numbers:
Over the last five years, consumers have defaulted on $267 billion in credit card debt. That’s good news for collection agencies, bad news for credit card companies. Overall though, fewer people have been defaulting and had their accounts “charged-off,” which usually happens after six months of non-payment.
