Credit Card Debt

Overspending, Consumer Culture, and Credit Card Companies

As of 2010, Americans owe a total of $852.6 billion in credit card debt. All of this debt is split between 54 million American households; the average in-debt American household owed $15,000 on their credit cards. Credit card companies make huge profits off of people who have credit card debt. With an average APR of 14.10% in addition to fees and penalties, they are swimming in money while we are drowning in debt.

Credit cards are designed to extract as much money as possible from card holders; this means that they want to keep us in debt, so long as we can eventually pay it off. If you are having difficulty paying your credit card bills and you are considering debt elimination options, a South Texas bankruptcy attorney can advise you on the best course of action. At Malaise Law Firm, our attorneys provide free initial consultations.

One way in which credit card companies manipulate consumers into spending more is by taking advantage of a psychological "discount" on future pain. Most people associate payments with negative feelings; however, the further in to the future the payments are, the less negative they become. This is consistent with most tasks with which we have negative feelings and is the basic explanation for procrastination. Whenever we buy things, we weigh the positive feelings of the item against the negative feelings of the payment; with credit cards, the negative feelings are smaller, and we end up spending more. Some studies report that we spend as much as 47% more when we use a credit card as opposed to cash. This future discount is also used when credit cards offer special intro rates; although we know that our rates will change, we do not consider future high APRs or fees to be as bad as present ones.

The ways in which we spend are also affected by our emotions, our conceptions of what our neighbors are spending, advertisements, and celebrity culture.

To learn more about our consumption habits, credit card companies, and debt relief, contact a South Texas Credit Card Debt Attorney today.