August 18, 2009
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News: Credit Card Spending Down
Americans have taken the recession seriously by curbing credit card spending and reducing debt. A recent Equifax report demonstrated that there was an overall decrease of approximately 3.3% in the nation's total credit card debt for the second quarter. Reducing card debt is a good move for Americans; however, not so profitable for the financial industry. It wouldn't appear many Americans have all that much sympathy for the banking and credit card industry in the wake of the deceptive and unfair practices they have participated in over the past several years. While they continued to stuff their pockets with large bonuses and corporate profits, Americans were struggling to make ends meet. Americans have nothing to lose by tightening up their belts and paying down their debt; but everything to gain.
Although many Americans are doing a better job at paying down debt, some cities aren't faring as well. According to the Equifax report, Visalia, California and Reno, Nevada credit card debt has nearly doubled at end of second quarter from same time last year. Both cities have been hit hard during the recession with higher levels of unemployment which could explain the increase if those residents have become more dependent on their cards to supplement their lost wages. Two other cities also hit hard with high unemployment and experiencing an increase in card debt are Phoenix and Miami. Some major areas that have been hit particularly hard with rising credit card debt are Provo-Orem, UT; Durham-Chapel Hill, NC; and Ogden-Clearfield, UT.
According to the Equifax report, Provo, UT leads the nation in rising credit card debt. The Provo, UT area is home to Brigham Young University and a growing population of young families which could explain the growing debt in that community. Durham County, NC boasts to have the highest average wage in the state. Such confidence could lead residents to feel more comfortable racking up card debt.