Amid sharp interest rate hikes, credit card balances can be costly for consumers

 

Amid sharp interest rate hikes, credit card balances can be costly¹ for consumers

Transcript²

Americans have blasted through their pandemic savings³ and are increasingly turning to credit cards to sustain their spending. But keeping a balance on a credit card is getting more expensive.

LEILA FADEL, HOST:

Life has become pretty expensive lately. The price of groceries, utilities, even public transportation all shot up last year. You can, of course, charge all these expenses to a credit card, but the balance you keep could cost you a lot these days. NPR's Arezou Rezvani reports.

AREZOU REZVANI, BYLINE⁴: Thirty-one-year-old Evan Laudenslager is many things. He's a New Yorker. He's a studio manager for a fine art photography lab. And he's also been carrying around an uncomfortable but familiar secret.

EVAN LAUDENSLAGER: I do feel that I suffer in silence with my debt.

REZVANI: Laudenslager says he's sharing his story to highlight the financial burdens young people are facing. He's about $75,000 in the hole. It's a combination of student loans, medical and credit card debt, and it's changed his life.

LAUDENSLAGER: There are things that I've had to give up, and there are things that I've had to write off. I can't see myself being able to buy a house. If my partner and I decided⁵ that we wanted to start a family, it's really impossible for me to imagine being able to afford that.

REZVANI: At the height of the pandemic, he was able to pay down some of his debts with government stimulus⁶ checks. But those payments stopped, inflation started and he was forced to lean a lot more on credit to get by.

LAUDENSLAGER: Most of my credit card use has been everyday expenses, things like groceries. And those little expenses add up quite a bit as prices across the board have increased.

REZVANI: And it doesn't stop there. Sharp interest rate hikes over the last year compounded his financial troubles, making his credit card debt more expensive.

LAUDENSLAGER: And it just feels like an impossible hole to climb out of.

REZVANI: It's a hole many people are stuck in at a time when the economy appears to be teetering. Nearly half of Americans say their savings have dwindled⁷ over the last year. To keep up with expenses, some are dipping into savings or retirement⁸ accounts, while others have been leaning on credit, says Charlie Wise of the consumer credit agency TransUnion.

CHARLIE WISE: We've seen over the past year, looking at credit cards, the average balance per consumer has increased fairly materially - about a $700 increase.

REZVANI: As credit cards continue to grow more expensive, Wise says more Americans are turning to a market that had fallen fairly quiet in recent years.

WISE: We saw record demand for personal loans during 2022, the highest that we've seen, certainly over the past decade and perhaps longer.

REZVANI: They're offered by the major banks, smaller credit unions and newer online lenders that experts say aren't always carefully regulated. The rates for those loans have gone up in the last year, as well, but they're often better than credit cards that are charging, in extreme cases, up to 36% in interest. It's a route Evan Laudenslager recently decided to take after nearly maxing out both his credit cards and watching his credit score slide.

LAUDENSLAGER: I did eventually find a loan that had a lower interest rate than my highest interest rate card, which helped justify⁹ it to me, helped make me feel like that might be worth it.

REZVANI: But he knows the road ahead is still uncertain.

LAUDENSLAGER: And now I have these big monthly payments, which I'm budgeting for. But it doesn't leave me any room for an emergency. All it would take is something unexpected for me to have to put that on my credit card again, and then I'm right where I started.

REZVANI: Back in the hole.

Arezou Rezvani, NPR News, Los Angeles.

1 costly   

adj.昂贵的，价值高的，豪华的

参考例句：

• It must be very costly to keep up a house like this.维修这么一幢房子一定很昂贵。
• This dictionary is very useful,only it is a bit costly.这本词典很有用，左不过贵了些。

2 transcript   

n.抄本，誊本，副本，肄业证书

参考例句：

• A transcript of the tapes was presented as evidence in court.一份录音带的文字本作为证据被呈交法庭。
• They wouldn't let me have a transcript of the interview.他们拒绝给我一份采访的文字整理稿。

3 savings   

n.存款，储蓄

参考例句：

• I can't afford the vacation,for it would eat up my savings.我度不起假，那样会把我的积蓄用光的。
• By this time he had used up all his savings.到这时，他的存款已全部用完。

4 byline   

n.署名；v.署名

参考例句：

• His byline was absent as well.他的署名也不见了。
• We wish to thank the author of this article which carries no byline.我们要感谢这篇文章的那位没有署名的作者。

5 decided   

adj.决定了的，坚决的；明显的，明确的

参考例句：

• This gave them a decided advantage over their opponents.这使他们比对手具有明显的优势。
• There is a decided difference between British and Chinese way of greeting.英国人和中国人打招呼的方式有很明显的区别。

6 stimulus   

n.刺激，刺激物，促进因素，引起兴奋的事物

参考例句：

• Regard each failure as a stimulus to further efforts.把每次失利看成对进一步努力的激励。
• Light is a stimulus to growth in plants.光是促进植物生长的一个因素。

7 dwindled   

v.逐渐变少或变小( dwindle的过去式和过去分词 )

参考例句：

• Support for the party has dwindled away to nothing. 支持这个党派的人渐渐化为乌有。
• His wealth dwindled to nothingness. 他的钱财化为乌有。 来自《简明英汉词典》

8 retirement   

n.退休，退职

参考例句：

• She wanted to enjoy her retirement without being beset by financial worries.她想享受退休生活而不必为金钱担忧。
• I have to put everything away for my retirement.我必须把一切都积蓄起来以便退休后用。

9 justify   

vt.证明…正当(或有理)，为…辩护

参考例句：

• He tried to justify his absence with lame excuses.他想用站不住脚的借口为自己的缺席辩解。
• Can you justify your rude behavior to me?你能向我证明你的粗野行为是有道理的吗？