Credit card use causes spike in consumer debt
American consumers are turning to their credit cards once again to pay for daily expenses, according to Federal Reserve data.
Consumer credit is on the rise -- up $5.1 billion in May -- and much of that is pinned on credit cards.
ConsumerAffairs.com says people are using credit cards not only to help manage increased gas prices but also to buy groceries and other necessities.
Although total consumer debt has increased in recent months, this is the first time revolving debt has jumped in 2011.
May's increase in credit card debt is the largest since June 2008, according to the Federal Reserve.
And an increase in revolving credit use could be a sign that consumers are still struggling with their personal finances.
With the economy on shaky ground and some economists predicting another recession in 2012, reducing debt should be a top priority.
If you can, pay off your credit card balance each month. Failure to do so could result in high interest charges as well as penalties and fees if you're late.
If you need help, read our 7 smart moves to curb your spending.
Our credit card payoff calculator can help you determine how long it will take to pay off current card balances.
See how different payment amounts affect the length of time needed to pay off debt and the savings that can be realized by increasing your monthly payments. Reducing or eliminating credit card debt is one of the quickest ways to reach financial security while saving money for other financial goals.
Follow Interest.com on Twitter.