Credit card debt is at a record high – here's what you can do if you feel buried

Holiday bills are starting to roll in and you may find yourself buried under big credit card balances.  

You’re not alone.  The country’s credit card debt is higher than it’s ever been. According to the Federal Reserve Bank of New York, credit card balances now total $1.08 trillion. And a lot of people are struggling with it.  

“And with the interest -- yeah, it just never goes down,” said Bobby Casaletto of Brookline. “It seems to always go up. I’m trying to with [the] two jobs, change that.” 

Matt Schulz, chief credit analyst at Lending Tree, believes it’s probably going to get worse before it gets better. 

“Inflation is hanging around. Interest rates are at all-time highs and just really everything in life seems like it's still getting a little more expensive,” Schulz said. “And that adds up to a really tough time for folks who are on a budget and living paycheck to paycheck.”  

In a new WalletHub credit card debt survey, 59% of Americans with credit card debt say they have more debt now than they did 12 months ago. Average household credit card debt stands at $10,263 – up from last year. 

Christie Matherne is an editor at WalletHub. “We project credit card debt to rise by approximately $101 billion by the end of this year. And that's driven by factors like high inflation and record interest rates," she explained.

The numbers are staggering.  But 84% of people with credit card debt tell WalletHub that getting out of debt is one of their goals for 2024.  If paying down debt is one of your goals, here’s where to start. 

“One of the best tools that you can have in the battle against credit card debt is a 0% balance transfer credit card. You generally need pretty good credit to be able to get one, but if you can get one, it can save you a lot of money in interest and can dramatically shorten the amount of time it takes to pay off that balance,” Schulz said. 

“The first thing you should do is prioritize paying off the balance with the highest interest rate -- you can repeat the process for all your other debts so your highest interest rate first and then go down the line,” Matherne said.  

Stick to a budget and stop making charges. You should also call your credit card issuers and ask them to reduce your interest rate.  Many people have had success doing this. And make sure you never miss a payment.  You can also get professional help paying off your debt.  

“Ultimately, it's still very, very important to pay on time every time for your credit card because of how much damage it can do to your credit score,” Schulz said.