Young adults in Texas and elsewhere in the United States are increasingly burdened by student loan debt, which is at an all-time high according to a leading consumer credit reporting agency. But millennials are also struggling with other types of debt, including credit card debt. While borrowers within this age group generally avoid credit cards, they’re sometimes lured by appealing offers and perks.
In fact, the biggest chunk of the debt owed by millennials between the ages of 25 to 34 comes from credit cards. According to a study by a personal finance website, Americans in general repaid nearly $40 billion in credit card debt during the first quarter of 2019, one of the largest payoff periods ever. Even so, Americans owe more than $1 trillion in debt of this nature. There’s also a tendency for adults to rely on credit cards more as they get older. There’s no indication that millennials are immune to this trend.
The large paydown that occurred in early 2019 is a bit misleading since it’s still only a fraction of total debt owed. The personal finance website estimates that average credit card-related debt owed per household is just over $8,000. Possible reasons for the credit card debt trend cited include higher interest rates and devaluing of the U.S. dollar by what some financial insiders consider misguided monetary policies. Also, many consumers are accustomed to using credit cards routinely to make purchases without realizing the long-term financial implications.
It’s rare for millennials to be at a point where bankruptcy is considered. However, a young adult overwhelmed by both student loan and credit card debt might benefit from a discussion of available options with a bankruptcy attorney. Initial efforts may include attempts to restructure existing debts in a way that’s more manageable. If this isn’t possible, the right approach to filing for bankruptcy may provide welcome relief.