Consumers are Trying to Get Their Way Out of Debt

( December 10, 2010

Consumers are Trying to Get Their Way Out of Debt

Consumers are Trying to Get Their Way Out of Debt

The usage of credit cards has been under critical scrutiny since the recession set in. Researchers found that 90% of the decrease in credit card debt was because of bad debt being written off the books. This write-down reached a record level in the month of February, 2009; the level reached to 8.82%, which is 300 points higher than that of the previous year.

The total decrease in debt amount is thought to be only around $10 billion. After much speculation, it has been found that there has rather been a constant rise in the national debt. According to market experts, national debt can rise to around $19.6 trillion by 2015 and public debt is estimated to rise to $14 trillion by the year 2015.

Recent updates on U.S. national debt

According to the Bureau of the Public Debt, U.S. national debt has increased by around $1.65 in the year 2010. According to them at the end of September, 2010, national debt was reported to be $13,561,623,030,891.79. Starting from 1957, there has been a constant rise in the debt amount and national debt has increased by around $250.8 billion each year. This debt amount pertains not only to public debt but also debt in regards to the federal government. It is said that the increase in the debt amount this year (2010) is the second largest increase after 2009. In 2009, the debt had increased by around $1,885,104,106,599.26 but this year it increased by around $1,651,794,027,380.04.

Financial experts also opine that 2011 U.S. budget may result in almost $10 trillion in deficits over 10 years and raise the federal debt to 90% of the economic output by the year 2020. White House released a budget in February which projects a 10-year total deficit of about $8.53 million. In addition, the Congressional Budget Office estimates that this deficit may increase to about $9.75 trillion. The federal debt in U.S. was $6.3 trillion when President Obama first entered White House and now it stands at $8.2 trillion and is supposed to be headed toward $20.3 trillion by 2020.

However, people are trying their best to pay down their debts and become debt free through various debt relief options. According to the TransUnion’s annual forecast, mortgage delinquencies have lowered throughout the nation. TransUnion also expects that mortgage loans in arrears for more than 60 days will decline by around 20% next year. Also, the numbers of delinquent credit cards are said to decline by around 10.67%. Also, Experian’s study on top 25 metropolitan areas, U.S. consumers are paying an average of $903 per month on their bills, including mortgage, credit card, auto loan and other financial obligations

People are also trying to boost their credit scores by paying off the debts through debt relief options. Federal reports show that consumers are trying to reduce their personal debt levels. At the same time credit usage is increasing too. Consumer credit rose by around by $3.38 billion in October as per Federal Reserve reports. Actually, this must be because consumers are seen to be educating themselves more on finance, post recession.

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Posted by on Dec 10 2010. Filed under Featured News, Finance. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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