NEWS: Hawaiians Go For Broke
The most recent data on American credit card
usage has provided hours worth of interesting
factoids, as well as piles of head-shaking bad
news about our bad plastic habits – we reported
last week on some of these bizarre and amazing
factoids. Another one to add to your "credit
card news you can use" file – apparently, Hawaii
is not the place to be if you want a shining
example of prudent credit card use.
Yes, Hawaii! The Associated Press reports that
the Experian studies discovered that more Hawaii
residents max out credit cards than any other
American citizen, by about 19%. As reported by
one of the "Big Three" credit reporting agencies
(along with TransUnion and Equifax), about one
in seven Americans, or 14.3%, charge up more
than half of their available credit. The "magic
formula" for good credit use –the figure that is
most beneficial to your credit rating- is
between 25% and 50% of your available credit
(the sum of all your credit limits) being used
at any given time. Any more than that and you
become a risk for repayment to your creditors.
In Hawaii, the amount of consumers taking that
risk shoots up to 17%.
Experts attribute the high cost of living in
Hawaii –a combination of sky-high real estate
prices, and higher-than-national-average fuel
costs- as one main reason why these citizens may
borrow more than is considered prudent. Those
living in the islands share one big factor with
mainlanders, however: a seriously diminished
control over their sense of impulse
gratification, thanks to the relative ubiquity
of credit cards in day-to-day American life. The
attitude of charging now and thinking about the
costs later is a real problem for all Americans,
not just those off the continent!
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