Consumers Cut Credit Payments_ Struggle To Pay Bills

I’m not surprised. It was only a matter of time before consumers started cutting back on payment amounts. This behavior, meanwhile, will only lead to more debt. The credit card payment rate for November fell by some 2.5 percentage points to 16.1%, according to USA Today. The decline represents one of the largest ever. From USA Today:”It’s kind of shocking,” says Robert McKinley, founder of CardTrak.com. “It indicates that there are fundamental changes in the way that consumers view and use credit.”The credit card payment rate is a widely watched indicator of consumers’ financial health. Its plunge comes as consumers have become more reluctant — and less able — to take on debt. Revolving debt, much of it on credit cards, dipped at a 3.4% annual rate in November to $973.5 billion, after flattening in October, preliminary numbers from the Federal Reserve show.Even with less debt, consumers are struggling to pay their card bills. The average household with at least one credit card owed $10,728 in 2008, nearly the same amount as in 2007, according to CardTrak.com.