Americans Have More Credit Card Debt Than Ever
6/5/202621 min
The collective credit card debt of Americans has reached an all-time high of $1.25 trillion. Soaring interest rates and stubborn inflation have also led more people to be late making their credit card payments or not paying at all. WSJ’s Dan Frosch reports on why that debt is growing and where people can turn for help. Jessica Mendoza hosts. Further Listening: Swipe, Spend, Repeat: The Perks Arms Race in Your Wallet Student-Loan Debt Is Strangling Gen XSign up for WSJ’s free What’s News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices
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First 90 secondsJessica Mendoza· Host0:00
[upbeat music] Melissa Megason lives in South Portland, Maine, where she's worked as a medical assistant for most of her career.
Melissa Megason· Guest0:11
We lived paycheck to paycheck as many middle-class people do here in Maine, but we were able to manage it.
Jessica Mendoza· Host0:18
[upbeat music] For a long time, Melissa and her then husband felt like they had a pretty good handle on their finances.
Melissa Megason· Guest0:25
We would use credit cards if we needed to for emergencies, especially with four dogs. Come time to go for their annual physicals and shots and all that stuff, that would be the type of stuff we would put on there. We never took vacations. Actually, we shared a vehicle for the longest time.
Jessica Mendoza· Host0:42
But then Melissa's life took a turn, and she found herself pulling out her credit cards more and more often. The debt started piling up. At its peak, what was the number that you were looking at in terms of what you owed to credit card companies?
Melissa Megason· Guest0:58
The peak would've been just a little over 20,000 for me.
Jessica Mendoza· Host1:01
Melissa makes about $65,000 a year, so her credit card debt was almost a third of her income. A- and how did you feel, or what were you thinking when you saw that amount, when it really sort of dawned on you?
Melissa Megason· Guest1:15
I was shocked, 'cause you don't realize it. But then you start thinking about it. A lot of it is late fees, over-limit fees, late fees, over-limit fees every month that you don't pay.
Jessica Mendoza· Host1:26
Mm.
Melissa Megason· Guest1:26
And so those keep adding up. It's like quicksand.