5 dangers of carrying credit card debt in today’s high-rate environment

Credit card interest rates have been climbing steadily over the last decade. During that 10-year stretch, the average credit card interest rate nearly doubled, climbing from about 12.9% in 2023 to nearly 24% today. And between the Fed’s rate hikes and pauses, card rates have compounded significantly over the last two years in particular.

The impact of the uptick in card rates has been profound for many cardholders. The total amount of outstanding credit card debt in the United States is currently $1.12 trillion, with millions of households struggling to make even minimum payments — as evidenced by the recent uptick in delinquent credit card accounts. And as the cost of carrying a balance has increased, more Americans are finding themselves trapped in a cycle of debt.

If you find yourself in a similar situation, these credit card debt issues can have a big impact on your financial stability, especially in today’s high-rate environment. Below, we’ll detail why.

 

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