- Goods and services inflation has been at 40-year highs
- Interest rates are at 30-year highs.
For a select few, they are not impacted very much by this new cost structure. Perhaps these people earn substantial sums of money and they don’t use much credit. And the extra money they pay at the grocery store is not enough to dent their budget.
For most of us, that’s simply not the case! According to government statistics, the cost of food is up over 25% since early 2019. Many people’s own experience tells them food costs are up quite more than the government stats reflect. This is far greater than incomes over the same time frame. Add soaring energy costs, rents, car prices, and other daily costs of living and many people have turned to plugging the gap by borrowing money. Credit card debt and personal loan debt (“consumer debt”) have greatly increased and are now at all-time highs.
Once the balances are accrued, the high-interest rates compound the problem. According to Forbes, the average credit card interest rate was 27.80% as of December 2023. Interest rates will continue to remain elevated. For a family that is carrying $25,000 in credit card balances, the interest alone is almost $600 per month without paying down a single penny of the credit card balance. Larger balances, which are common, really set a trap where the debt is extremely difficult to eliminate. There are only a few ways to escape this nightmare.
The attorneys at RQP Law can review your finances with you and recommend a course of action. Call the office at (610) 323-5300 to discuss your situation and see what options are there to get you back on track.
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