Household Debt Passes $16 Trillion in Second Quarter 2022

(KNSI) — Second quarter household debt passed $16 trillion as inflation stays at a 40-year high.

Credit card debt surged from April through June. The report from the Federal Reserve Bank of New York says Americans are borrowing more, and a big part of the increased borrowing is attributable to higher prices. Jason Meza with the Better Business Bureau says putting household bills on credit cards can also be dangerous. “You may plan to pay off your balance every month to avoid some of those charges, but the reality is the majority of credit card holders do not do that. If you’re trying to play catch up with a card already, debt can quickly spiral out of control.”

He says, if you plan to open a new line of credit, it’s more important than ever to read the fine print. That includes the interest rates. “You have to get better at reading the contract. Read the terms carefully. There may be big penalties if a payment is missed.

Americans opened 233 million new credit card accounts during the second quarter. That’s the most since 2008.

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