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Household credit card debt increased in 2018

Households in Virginia and throughout the country carried an average credit card balance of $8,284 in the third quarter of 2018. That was a 2 percent increase from the third quarter of 2017, according to a study from WalletHub. As debt levels increase, it may become more difficult for households to repay them. Increasing interest rates may also make it harder to repay those balances.

Current credit card debt levels are approaching those last seen during the Great Recession, and the amount could be exceeded in 2019. At that point, credit card debt balances may be at an unsustainable level. According to WalletHub, current levels are only $177 away from that point based on current income figures. In total, Americans owe $974.2 billion in credit card debt, which is up 3 percent from 2017. The increase comes in spite of the fact that $40.8 billion in debt was paid off in the first quarter of 2018.

When used properly, a credit card may be a powerful financial tool. It can help with cash flow issues or be used to pay certain household bills. However, those who are having difficulty paying down their debts may face negative consequences, such as a lower credit score. In some cases, it may be necessary to file for bankruptcy. While bankruptcy may have some drawbacks, it could also have benefits for an individual.

Filing for personal bankruptcy could lead to credit card debts being discharged. Depending on a person's income and assets, he or she may pay little or nothing to creditors. During a bankruptcy case, creditors are generally not allowed to make contact with a debtor by phone or by mail. Instead, inquiries about a credit card debt balance must generally be made to an attorney or another representative.

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