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Home arrow Marketing Research News arrow Latest Market Research Findings arrow 1 In 3 Americans Have Dangerous Levels Of Credit Card Debt
1 In 3 Americans Have Dangerous Levels Of Credit Card Debt PDF Print E-mail
Written by Kumar Venkatesiah   
06 Mar 2015

If you thought the recession of 2008 would have taught people the risks associated with over-dependence on credit card debt, you are mistaken. According to a new report published by, close to 24% of Americans owe more credit card debt than they have in emergency savings. This means that these people are just one illness, accident or any other event requiring a major expense away from being pushed into financial doom.

Even without such major expenses, the study points out that this section of people could find it next to impossible to climb out of their debt. This is because the interest people owe on credit card debt is higher than the income they earn in interest from bank savings – as a result, even at status quo, the amount they owe as debt is always on the rise.

The study further found that Americans as a whole have not improved on the personal finance front over the past few years. 58% of the surveyed individuals were found to have more money in savings than the credit card debt they owed. However, this figure has stayed stagnant since 2011. According to Greg McBride, the chief financial analyst at, even in the absence of credit card debt, the majority of households do not have enough emergency savings to cover three months of expenses.

Here are a few other important inferences made from the survey:

Millennials Less Prudent : The people with the highest financial risk due to credit card debt were senior citizens (aged 65 and above) and millennials. These two groups of people were more likely to have credit card higher than savings.

Savings Increase With Income : One saw it coming – people with higher incomes were more likely to save. 73% of the respondents who earned more than $75,000 per annum reported to have emergency savings higher than credit card debt. The corresponding figure among people who earned $30,000 or less was just 48%.

College Graduates Have Least Savings : Do student loans have a part to play in this crisis? According to the survey, just 3% of college graduates had emergency savings higher than credit card debt. In comparison, 11% of Americans with some college or 21% of respondents with high school education had better savings to credit card debt ratio.

The BankRate study is a grim reminder of the financial risks facing Americans today. A study conducted by Lexington Law last year showed that close to 23% of Americans have lost sleep over a money issue with medical bills leading the list of reasons keeping Americans awake at night. Interestingly, in a contrast with the BankRate study, the study last year showed that the middle aged group between 35-44 years of age were more likely to be worried about financial security compared to the millennials or the senior age group.

What both studies however have in common is the fact that nearly a quarter of Americans are at possible financial risk that can put them in deep financial crisis. The need of the hour is thus general awareness about these impending risks and how people can build a savings net for their families.
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