Ways to tackle debt as credit card interest rates increase

Rising interest rates keeping some in debt longer
Published: Jun. 29, 2023 at 3:10 PM CDT
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(InvestigateTV) — Nearly 1 in 5 Americans say it will take them longer than planned to pay off their existing overall debt because of higher interest rates, according to NerdWallet’s 2023 Consumer Credit Card report.

NerdWallet’s credit cards expert Melissa Lambarena said more people are using “buy now, pay later” services to help them make purchase, as credit card rates increase.

The report found others are keeping their debt a secret, with almost a third of Americans saying they themselves don’t even know how big their debt is.

“In some cases, it’s that maybe they have regrets about financial decisions they made. So, there might be some shame attached to that,” Lambarena said. “Or in other cases it might be that maybe they just weren’t brought up to talk about money, so having those discussions feels unnatural.”

The average credit card APR is currently 24.53%, according to Forbes. This is one of the reasons Lambrena said it’s more expensive to pay off debt right now, leading people to stay in debt longer.

Lambrena urged consumers with credit card debt to make a plan to pay it off, offering several suggestions:

  • Consider consulting a professional credit counselor or a financial planner
  • Look for zero or low percentage balance transfer offers to help pay down balances more quickly
  • Think about a personal loan to consolidate debt

NerdWallet has many articles with further advice on how to pay down credit card debt such as:

How to Get Out of Credit Card Debt in 4 Steps

Dealing With Credit Card Debt: How to Get Debt-Free

Pay Off Debt: Tools and Tips