It’s undeniable that America has a credit card debt problem. As a Memphis bankruptcy lawyer, I meet many hard-working people who are unable to live their lives to the fullest because of debt. They are stuck in a cycle they cannot break.

Revolving credit card debt — balances carried from month to month — are reaching highs never before seen. In a survey from earlier this year, NerdWallet found that America’s total credit card debt had reached $423.8 billion, an increase of 5% from 2018.

  • The average credit card debt per U.S. household is $6,741.
  • 1 in 11 Americans who have credit card debt, roughly 9%, don’t think they’ll ever be free of it.
  • 1 in 5 Americans expects to die with credit card debt.

Perhaps worst of all, getting out of it is no easy feat, no matter who you are or where you come from. To hold significant credit card debt is to find yourself sinking deep into quicksand.

High Interest Rates Make Debt Inescapable

When used wisely, credit cards are not inherently dangerous. They can be helpful, in fact. Unfortunately, many people use them to live above their means. Often, credit card use does not reflect a lack of responsibility. When expenses outweigh income, people find themselves with few options.

Credit card debt can rapidly snowball, however, because of interest rates. When you consider the combination of unfavorable interest rates and the problem of expenses versus income, it’s no surprise that many households cannot rid themselves of debt.

Most people average $5,000–7,000 in credit card debt in their lifetimes, but interest rates can complicate the equation. If you have an average balance of $2171.70 and an interest rate of 15%, you will end up paying over $13,000 over 40 years. I regularly see debt much worse than that.

Bankruptcy is not a punishment for reckless finances — it’s designed to help you.

When you look at the numbers above, it seems impossible for the average American to rid himself of debilitating debt. Many people who come to me for help filing bankruptcy do not fit the profile you might expect. They have high-paying jobs and own homes. But they do not want to spend the next decades of their lives in debt.

I recently helped a young couple who came to me for help with a Chapter 7 bankruptcy, which completely wipes away credit card debt. They carried a balance of $18,232, with a minimum monthly payment of $510. If they paid only that each month, it would take 76 years to pay off their debt, with a total cost of $221,563. That’s about 12.5 times the actual amount of debt.

How can average Americans possibly find a way out? The answer is that they can’t. Bankruptcy was specifically designed to make sure there’s an escape from serious debt. Unfortunately, it’s clouded in many misconceptions. Many people do not realize that bankruptcy is the solution, not the problem.

Throughout the past 30 years, as a Memphis bankruptcy lawyer, I’ve helped thousands of people get out of debt and turn their lives around. I can do the same for you.

If you have questions or concerns, we are happy to sit down and discuss your options at no cost. Contact us here or call (901) 327-2100 to get started today.