Bankruptcy Lawyers
South Carolina

803-799-1700

Analyzing Credit Card Usage Patterns and Trends

Close-up of a lot of credit and debit plastic bank cards.

When to file for bankruptcy for credit card debt

The soaring average credit card debt in the U.S. - hitting between $6,360 and $11,000 per borrower in 2023 - indicates the financial strain affecting countless individuals. However, breaking free from the cycle of credit card debt is often a monumental task.

For many, the solution is bankruptcy, a legal process that allows individuals or businesses overwhelmed by debt to seek relief by restructuring their finances or liquidating assets to settle debts. Success typically requires legal knowledge, smart planning, discipline, and the guidance of an experienced South Carolina bankruptcy lawyer.

Relief from significant credit card debt takes action. Attempts to pay down burdensome credit card debt little by little frequently prolong the inevitable. Without proactive steps to address credit card debt, people typically face worsening financial instability, diminished quality of life, and prolonged inability to achieve long-term financial goals.

Understanding the factors contributing to the increase in credit card debt can provide insight into common mistakes. Here's how people got into or added to their credit card debt in 2023 and the steps to address debt and restore financial independence.

Credit card trends and statistics

In 2023, notable credit card trends included a surge in cash advances and balance transfers and increasing debt balances, delinquencies, and charge-offs, according to Forbes Advisor. Additionally, there was a rise in late payment fees and interest rates, signaling potential financial distress among cardholders. To provide a fuller picture of U.S. credit card debt, here are some insightful statistics from Forbes and Experian:

  • Credit card delinquency reached 3.1% by the end of 2023, the highest rate since 2011.
  • About 48% of all credit card users carried a balance at least once last year.
  • Over 20% of credit card holders say they cannot pay next month's credit card bill in full.
  • The average credit card interest rate is 27.89%
  • Merchant processing fees increased by more than 20% over 2021, adding up to more than $160 billion in fees passed on to the customer in 2022. With an amount equal to 2% to 4% of the purchase price, credit card service charges vary by merchant and type of card.

When to consider bankruptcy for credit card debt

Deciding whether to declare bankruptcy is a significant financial decision that should be approached thoughtfully. An individual or household's debt ratio is one sign that it may be time to consider bankruptcy.

A ratio of debt to income significantly above 50%, for example, is not sustainable in the long term, and individuals in this situation should contact an experienced bankruptcy attorney to learn more about options to limit financial damage and protect assets. Here are some more signs that credit card debt may have reached a point where legal action should be considered:

  • Inability to make minimum credit card payments.
  • Paying one credit card bill with another credit card.
  • Constant harassment from creditors.
  • Using credit cards to pay for necessities.
  • Foreclosure or repossession threats.
  • Little to no savings or retirement funds.
  • No realistic plan to repay debt.
  • A creditor has filed or threatened to file a lawsuit against you.

Before making any big decisions about handling debt, consult a qualified bankruptcy attorney to assess your financial situation and explore all available options. A lawyer can provide personalized guidance based on your circumstances and help you understand the potential consequences and benefits of filing for bankruptcy.

A fresh start free from credit card debt

We understand how overwhelming it can seem to file for bankruptcy, no matter what led you to this point. However, if you're struggling to manage credit card debt and have explored all options without achieving desirable results, bankruptcy might be the solution.

At Benjamin R. Matthews and Associates, LLC, our reliable legal team can evaluate your situation and, if appropriate, guide you through bankruptcy. With offices in Columbia and Rock Hill, South Carolina, we are compassionate and experienced bankruptcy lawyers and will work hard to make the process as painless as possible for you. For a full evaluation of your existing debt and to discuss ways bankruptcy may help you get out of debt, contact our law firm and schedule a free case evaluation.

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2010 Gadsden Street
Columbia, SC 29201

Phone (803) 799-1700
Fax (803) 728-6718

331 E. Main St, Suite 257
Rock Hill, SC 29730

Phone (803) 909-9377
Fax (803) 728-6718