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Consumer Debt Rising With Neile Simon

MoneyWise | Jun 18, 2022

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Show Notes

Americans are starting to break out the plastic again, and that means consumer debt is once again on the rise. Today on MoneyWise, Neile Simon with Credit Counselor with Christian Credit Counselors joins us to discuss how you can get help with getting out of credit card debt.

Neile Simon is is a Certified Credit Counselor with Christian Credit Counselors.

  • Simon shares the latest figures on U.S. personal debt.
  • SURGING PERSONAL DEBT
  • In one month alone debt levels jumped by over $40 billion to a total of nearly $4.5 trillion. That's an annual increase of 11.3%, far higher than was predicted and setting a new high.
  • There are two types of consumer debt:
  • Non-revolving debt, which includes things like car and student loans. That debt grew by about 8.5% to nearly $3.5 trillion in February alone!
  • But revolving debt shot up far higher. Credit cards and other types of revolving loans jumped by over 20% to more than $1 trillion in a single month! This is a fast-rising trend. The January increase was only about 4%
  • WHAT’S CAUSING THIS?
  • Analysts believe inflation, now at a 40-year high, is a major culprit. Prices for almost everything have shot up, putting a strain on budgets. Prices at the pump are especially painful right now.
  • WHAT’S THE SOLUTION?
  • Most people will have to tweak their budgets to adapt to the new reality of rising prices.
  • Some categories will need to be cut to account for higher costs in other categories. The important thing is to stay on a spending plan and find a way to spend less than you earn.
  • PLEASE do not think of credit cards as a solution to an income shortfall. That will only make the problem worse.
  • But what if you’re already buried under substantial credit card debt. What’s the solution?
  • IS DEBT SETTLEMENT THE ANSWER?
  • We’re getting more calls these days about debt settlement. But Simon says debt settlement (which is different from credit counseling) is not the solution either.
  • Debt settlement may lower your monthly payment, but it often leads to paying more interest overall. It also puts you at risk of continuing to use consumer debt to make ends meet, ultimately digging an even deeper hole.
  • CHRISTIAN CREDIT COUNSELING
  • Christian Credit Counselors doesn’t do debt settlement.
  • When people sign up with Christian Credit Counselors, they will work with their creditors to dramatically lower interest rates and arrive at one affordable monthly payment. CCC has existing arrangements with all major credit card issuers to lower your interest rates.
  • Clients ultimately pay less interest and are typically able to pay off card debt up to 80% faster than by doing it themselves.
  • For more information, visit their website at ChristianCreditCounselors.org or call 800-557-1985.

On this program, Rob also answers listener questions:

  • How much actual cash should you keep on hand?
  • Does it make sense to take money out of retirement investments to pay for moving costs when going into full-time ministry?
  • Can you move 401k funds into an I-bond?

Remember, you can call in to ask your questions most days at (800) 525-7000 or email them to Questions@MoneyWise.org. Also, visit our website at MoneyWise.org where you can connect with a MoneyWise Coach, join the MoneyWise Community, and even download the free MoneyWise app.

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