Credit Card Debt Increases Are Cause for Concern
2023-11-12 – BE&O ATC
After three years of cautious spending and increased household savings during the pandemic, some economists are starting to worry about an alarming increase in credit card debt across America.
Jane King, a Market Analyst with NASDAQ, says credit card debt is approaching a record high of over $1 trillion last quarter. It’s the largest increase in credit card debt in history. King says after saving cash during the Covid years, consumers are now spending more and using their savings and credit cards to feed their spending.
One of the biggest issues right now is inflation. With wages failing to keep pace, families use credit cards for groceries or rent payments. Across the country, including Indiana, the average cost of rent is increasing faster than most Americans’ salaries.
On a lighter note, King says Indiana is doing better than most states when it comes to credit card debt. Indiana ranks 44th lowest, with the average Hoosier carrying about $2,300 in credit card debt. Nationally, that number is closer to $6,000. This lower figure in Indiana is mostly attributed to the overall lower cost of living in the state. While Hoosiers are still feeling the pain of rising inflation, the overall rise in the cost of groceries and rent in Indiana is lower than in the rest of the nation.
King also says the Indianapolis housing market is another good news source. Indy is considered a “hot” market; she says this is a good time to sell your home. Half of the homes that are put up for sale in Indianapolis go off the market in only two weeks. That makes Indy one of the nation’s fastest home sales markets.
With an average home price of only $255,000, King says that makes the home buying market in Indiana incredibly attractive to out-of-state buyers, which could result in increased prices as cash-heavy out-of-state buyers make more attractive offers to sellers.