Credit card use declines as consumers face financial challenges

Mississippi residents should realize that they are not alone in their fears about credit card debt and other financial challenges. In fact, the Federal Reserve just released a report indicating that United States consumers cut back on their credit card use this summer. However, consumers' attention to credit card debt is not distracting them from their crucial needs. Recent statistics also show that consumers continue to borrow money for automobile and education loans. The current financial situation is a bit of a roller coaster ride as consumers grapple with managing their expenses and other financial challenges.

In Federal Reserve's recent report about consumer borrowing, statistics reveal that consumers remain skeptical in the present financial climate. Overall, consumers are more frugal and relying less on credit cards - a trend that began with the 2008 financial crisis. Although the times are marked by high unemployment rates and a stagnant economy, consumers nevertheless continue to borrow money in particular areas. Specifically, the report notes an increase in consumer borrowing in the areas of car and education loans. Experts maintain that these spending and borrowing habits show that consumers want to tackle their financial challenges while gearing themselves up to be more competitive in the labor market.

The federal report speaks to the financial situation in Mississippi. Like consumers throughout the nation, Mississippi residents experience a host of financial challenges like credit card debt. It is easy to become overwhelmed by such issues and attempt to avoid them. However, it is more important to identify debt relief solutions. Congress has already identified one potential solution by passing the Credit Card Accountability Responsibility and Disclosure Act of 2009, also known as the Credit CARD Act, which offers several protections for consumers. Consumers should also do their part to minimize debt. Relying less on credit cards and limiting expenses to actual needs instead of desires are a few strategies. The bankruptcy laws also offer consumers with tools to combat credit card debt and other financial problems.

The current national economy and fiscal situation present financial challenges for many. Like consumers across the county, Mississippi residents must not become discouraged. It is important to identify financial issues, like credit card debt, and develop strategies to alleviate them.

Source: Washington Post, "US consumers cut back on credit card use in June, borrowed more to buy cars and attend school," Aug. 7, 2012

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