Americans have been successful at getting some of their debts off their backs, but many still have a long way to go.
Low- and middle-income people are finding an escape difficult as they pay interest on top of interest.
Forty percent have turned to their credit cards to cover basic living expenses such as rent, mortgage bills, groceries and utilities, according to a national survey by think tank Demos.
Credit cards have been a safety net as people have lost jobs since 2008 and faced the pressure of high gas prices, said Amy Traub, senior policy analyst for Demos.
Now, the average debt on cards held by low- and middle-income people is $7,145, compared with $9,887 in 2008, according to the survey.
Fifty-one percent said cost-of-living expenses contributed most to their current card debt.
Some bought dubious debt-protection products, which suspend payments on obligations during times of hardship.
The greatest debt burdens are being carried by older Americans, with people 65 and older averaging $9,283 in credit card debt, according to the survey.
Demos attributes problems to the financial crisis, which slashed household savings in 2008 and 2009 and left individuals insecure at retirement.
Other analyses have suggested that seniors, who tend to rely on bonds, CDs and savings accounts, have struggled to cover living expenses as Federal Reserve policies have left interest rates near zero since the financial crisis.
Medical bills have also contributed to problems, Demos said.
About 35 percent of those carrying debt on their cards said a member of their household had been trying unsuccessfully to get a full-time job.
Other research shows young Americans were the most likely to be unemployed during the recession, while older workers experienced the most difficulty getting rehired.
Those on solid footing now except for oppressive debt payments can do something about it. There’s no need to pay for help, and firms that promise to do so can get you deeper in trouble. Try these tools: www.tinyurl.com/debtplannertool and debtcoach.bills.com/start.
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