According to a new study from CreditCards.com, the Lone Star State claims three of the five cities with the highest credit card debt burdens.
The study compared the average credit card debt and the median income in the 25 largest metro areas in the U.S. The highest debt burdens happen where credit card balances are relatively high and earnings are only average or lower. For example, San Antonio’s average credit card debt per bank cardholder ranks 5th highest among the 25 cities, but its median income earned 22nd place.
Houston has the third highest credit card debt burden in the country. Debt is growing. Interest rates continue to rise. CreditCards.com's Matt Schulz says 2018 needs to be the year people focus on paying off credit card debt.
“San Antonio actually had the highest credit card debt burden in the whole country. Houston is third and Dallas Forth Worth is fifth. They say everything is bigger in Texas, and I guess that also applies to credit card debt burden,” said Schulz.
Houston's high credit card balances, but average income puts us third in the nation for highest credit card debt burden.
“Houston’s issues were that it had the fourth highest average credit card debt of the 25 cities we looked at, but was just in the middle of the pack when it comes to income,” said Schulz.
He said factor in unexpected expenses, like we had following Hurricane Harvey, and debt can really snowball.
“Getting out of debt isn’t easy, but it can be done with willpower and determination,” said Schulz. “Consider a 0% balance transfer credit card with a long interest-free period. It may seem strange to combat credit card debt with a new credit card, but the truth is that used wisely, the right balance transfer card can save you a fortune in interest and shave months off the time needed to pay off that debt.”
Consumers can determine how long it will take to pay off their current balance by using CreditCards.com’s payoff calculator.
Making only minimum payments, it would take the typical San Antonio cardholder nearly 20 years to expunge the city’s average credit card debt of $7,070. And he/she would pay over $6,862 in interest. CreditCards.com recommends dedicating at least 15% of gross monthly income towards credit card debt. In that scenario, the typical San Antonio resident’s payoff time drops to just 22 months and costs $911 in interest.
Highest Credit Card Debt Burdens
San Antonio (22 months, $911 interest)
Miami/Ft. Lauderdale/West Palm Beach (21 months, $814 interest)
Houston (20 months, $799 interest)
Los Angeles (20 months, $745 interest)
Dallas (19 months, $801 interest)
Lowest Credit Card Debt Burdens
21. Seattle (15 months, $577 interest)
22. Washington, D.C. (14 months, $613 interest)
23. Boston (14 months, $524 interest)
24. Minneapolis (14 months, $493 interest)
25. San Francisco (13 months, $495 interest)