Texas ranks 2nd for increase in US credit card debt

An expected Federal Reserve rate hike could cost people even more in credit card debt

HOUSTON (CW39) – Rising prices, inflation and a looming recession have led many consumers to max out their credit cards. Now it’s starting to show up as more and more people accumulate additional debt.

According to the latest Credit Card Debt Study by WalletHub, Texas ranks #2 in the United States for the highest increase in debt in the country.

Credit Card Debt Study Key Statistics

  • Texas debt: The average Texas household has credit card debt of $8,681, after an increase of $593 in the second quarter.
  • Record the Q2 increase. Credit card debt increased by nearly $67.1 billion during the second quarter of 2022, an all-time high for the second quarter of the year.
  • Accumulation greater than normal. The increase in consumer credit card debt in the second quarter of 2022 was 3.5 times greater than the post-Great Recession average for a second quarter.
  • Record annual projection. WalletHub predicts consumers will end the year with about $110 billion more in credit card debt than they started, which would be near a yearly high.

The study shows that during the 2nd quarter of 2022, the country as a whole accumulated $67.1 billion in debt. This is an all-time high for credit card debt added in the second quarter of a year, and WalletHub now predicts consumers will add a total of $110 billion in debt in 2022.

And with the Federal Reserve set to raise its target rate by 75 basis points on September 21, WalletHub predicts it will cost people with credit card debt an additional $5.3 billion over the next 12 months.

States with the highest increase in debt States with the lowest increase in debt
California Vermont
Texas Wyoming
Florida North Dakota
New York South Dakota
Illinois Alaska

Moreover, the increase in debt is not even happening throughout the country, because some regions have greater payment problems than others.

Key Findings from the Fed Rate Hike Survey

  • More expensive debt. A Federal Reserve interest rate hike on Sept. 21 would cost people with credit card debt an additional $5.3 billion in the next year alone. This is on top of the $15.3 billion increase already caused by previous Fed rate hikes this year.
  • Inflation concerns. 85% of Americans are worried about inflation right now.
  • Fed increases affecting portfolios. 63% of respondents say their portfolio has been affected by Fed rate hikes this year.
  • Affected monthly expenses. 62% of respondents say inflation has affected their monthly grocery spending the most, followed by gas (32%) and housing (6%).
  • Government intervention at the pump. 71% of people think the government should cap gas prices.
  • Not ready for recession. 44% of people believe they are not financially prepared for a recession.
  • High inflation preferable to high unemployment. 56% of Americans say they prefer high inflation to high unemployment.

For the full ranking, check out WalletHub’s study here.

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