Pennsylvania residents may be concerned about the recently announced interest rate increases for American Express cardholders. While it is legal for the company to raise their rates, there are certain guidelines that credit card issuers must follow. The CARD Act, which was signed in 2009, changed the way credit card companies can do business and gave consumers several protections.
Buying on credit has become the norm for Pennsylvanians. Nationally, the average person holds over $2700 in credit card debt. Unfortunately, with interest rates ranging from 13 percent to 20 percent annually, items purchased on credit can end up costing up to three times their value.
Using credit cards can create financial challenges especially if consumers do not watch their spending and do not understand how interest is calculated. Credit card users with consumer debt who experience unemployment, reduced income and increased expenses may face creditor harassment because of delinquent payments. Consumers in Pennsylvania and across the country who are making only minimum payments on a credit card to their credit card company could benefit from understanding how credit card interest is calculated.
Pennsylvania residents may be surprised to learn that the Internal Revenue Service considers forgiven or cancelled debt to be income. Consumers who reach agreements with creditors to lower the amount they owe are often surprised when they subsequently receive a cancellation of debt notice from the IRS. The agency learns about the arrangement because creditors are required to notify them when an outstanding balance is reduced by $600 or more due to debt forgiveness or cancellation.
Pennsylvania readers might be interested to learn that, according to ProPublica and National Public Radio, 10 percent of working people in the U.S. aged 35 to 44 are subject to wage garnishment. Many of the garnishments are because of student loans, medical or credit card debt.
Many Americans struggle with debt, especially credit card debt. For some, unchecked spending combined with the high interest and fees associated with credit cards can lead to financial pressure and anxiety. Pennsylvania residents are not immune to this situation, and anyone struggling with credit cards may benefit from strategically pay down credit card debt as soon as possible.
Credit cards have a way of being people’s closest comrades and simultaneously being their worst enemies. This is because the more that credit cards are used, the more people can buy and pay for. However, it also means that people incur more debt. Credit card debt may be particularly troubling if a person begins to have his or her wages garnished in order to pay back his or her financial obligations.
People in Pennsylvania are generally aware that debt on a credit card is undesirable. A majority of credit cards charge high interest rates, which makes it expensive to maintain a balance on a card from one month to the next. Credit card debt may also negatively impact one’s credit score, especially if the person’s cards are maxed out. It’s best to use credit cards in only a few select situations.
Being in debt in Pennsylvania can feel like being in an inescapable deep hole. The more a person may try to climb out of the financial hole, the more he or she may feel behind due to high credit card interest rates and inadequate income. There are a few signs that a person may benefit from filing for bankruptcy in order to finally remove his or her debt.
Using credit cards is one of the easiest way to rack up thousands of dollars in debt. This is especially true if a person in Pennsylvania encounters a financial emergency that requires use of a credit card. However, credit card debt is one of the hardest types of debt to eradicate because of the high-interest rates often tacked onto these cards. Research shows that an increasing number of people in America realize this and are becoming more conservative in their credit card usage.