The total amount of credit card debt across the US is enough to make your head spin. Total credit card debt was $854.9 billion as of August 2012, according to the Federal Reserve. The amount of credit card debt shot up just over 6 percent from July of 2011, but was down from the month earlier.
Median Debt By Household
The median credit card balance per household has dropped since 2007, according to the Federal Reserve. In 2007, the median card balance was $3,100. By 2010, which is the latest year that information is available, the median balance dropped to $2,600. As of 2010, 39.4 percent of households carried a balance on their credit cards. 10.8 percent of households had a balance that was past due by more than 60 days.
High Debt States
The amount of credit card debt varies from state to state. 24/7 Wall St. points out that states that have higher average incomes typically have higher average credit card debts. Alaska is the state with the highest credit card debt, an average of $7,937 per household as of 2011. The median income in Alaska is $64,576 as of 2011, which is the third highest of all the states. Plus, the cost of living in Alaska is the second highest in the country. Other states with high average credit card debts include New Jersey, Connecticut and New Hampshire -- all states with higher than average median incomes and high costs of living.
Low Debt States
The states that have lower costs of living and lower median incomes also have lower credit card debt across the board. Take Louisiana for example. In 2011, its average credit card debt was $5,856. It's the state with the 10th lowest median income, at $42,505 as of 2011. Plus, its cost of living is the 20th lowest in the country. Good credit can also play a role in a state's average credit card debt, as seen in the case of Wisconsin, which has the lowest credit card debt nationwide as of 2011. It was also the state with the 14th highest average credit score.
The recession that began in 2008 played a big role in the amount of average debt for a few reasons. For one thing, banks were less likely to give credit cards to people who did not have stellar credit. For another thing, a number of banks and lenders stopped trying to collect on bad debts starting in to 2012, according to the "Christian Science Monitor." An Associated Press article published by CNBC suggests that credit card debt averages increased from 2011 to 2012 because banks have started to give cards to people usually considered sub-prime borrowers, or people with not-so-great credit scores, based on data from TransUnion.
- NPR: Credit Card Debt Cut - the Reason May Surprise You
- 24/7 Wall St: States With the Highest (and Lowest) Credit Card Debt
- CNN Money: Credit Card Debt Drops 11 Percent
- Christian Science Monitor: Credit Card Debt is Down, But Don't Cheer
- TransUnion: Credit Card Originations up While Delinquency Rates, Balances Remain Near Record Lows
- Federal Reserve: Consumer Credit August 2012
Based in Pennsylvania, Emily Weller has been writing professionally since 2007, when she began writing theater reviews Off-Off Broadway productions. Since then, she has written for TheNest, ModernMom and Rhode Island Home and Design magazine, among others. Weller attended CUNY/Brooklyn college and Temple University.