A survey by Bankrate Credit Cards claims that U.S. adults with net worth of $100,000 or more are the most likely to carry credit card debt. It may be a good debt or a bad debt. Bad debt is usually more than what you can actually afford to pay back. Like buying a car out of your budget.
Kayse Kress, financial planner at Physician Wealth Services, says that there are both good debt and bad debt in this world. But the difference is one brings us closer to our goals and the other takes us farther away from it.
Talking about debts, 42 percent of U.S. adults currently have credit card debt and many of those actively look out for ‘best credit card for me‘, 27 percent have a car loan. Moreover, 26 percent own a mortgage, 16 percent have a student loan, 12 percent have a personal loan. But the people who have the most credit card debt, among U.S. adults, are the ones with $100K worth or more. They constitute 57% of the credit card debt holders.
The generation likely to carry the most debt is the Generation X, those aged between 39 to 54 (51%). Followed by them comes silent generation (42%), then the millennials (37%) and Gen Z (15%). In the survey, the most common reason for the credit card debt found was retail shopping (28%). This was followed by retail purchases like clothing or electronics (16 %), car repairs or maintenance (11%), and medical bills (11%).
A report by CNBC in 2019 had the same results, which found that 23% of the Americans are going into debt paying for basic needs like food and housing. Many are also facing difficulties with insurance. There are sites which are helping people with the Car Insurance quote comparison as well as different other kinds of insurance. These comparison charts are still a relief for the Americans.
Ted Rossman, credit card industry analyst for Bankrate ,said that going into debt for living a fancy lifestyle can cost you financial stability.