AMAZING CREDIT CARD FACTS

YOU ARE BEING ROBBED BLIND

• In 1970, 51% of Americans had a credit card, compared with 93% today. The average cardholder has 7 cards

• Americans owe $850 billion in credit card debt. The world's 54 poorest countries owe $412 billion in foreign debt

• 60% of Americans have been in credit card debt for more than a year

• The average U.S. household owes $9,659 on its credit cards

• If you owed that much on a card with a 14% apr (the average interest rate) and made 2% monthly payments, it would take you more than 6 years to pay off—and you'd pay $4,922 in interest

• The average American household spends 14% of its disposable income paying off debts. It puts negative 0.5% into savings

• Last year, banks sent out 8 billion credit card applications, a 30% increase since 2005. Credit card companies spend an average of $58 to sign up a new customer

• Madonna reportedly gave her 9-year-old daughter a credit card with a $10,000 limit in 2005. A friend told In Touch, "She is hoping to teach Lourdes to be responsible with money." The Material Girl's publicist denies it

• In March, Hasbro announced that Visa would be the "preferred form of currency" in a new Game of Life. A Visa exec called the move "a powerful illustration of consumer preference to pay with Visa for everyday purchases and once-in-a-lifetime experiences"

• Americans charged $51 billion worth of fast food last year, a 29-fold increase since 2001

• 1/3rd of low- and middle-income households report going into credit card debt to pay for rent, utilities, and food

• Kiss of Debt; Make Love, Not Debt; Wallowing in Debt; and Broke-Ass Student are among the dozens of "debt blogs" that chronicle their authors' struggles to pay off credit cards and other bills

• Since 1996, when the Supreme Court struck down limits on credit card fees, the average late penalty has jumped 162% and the average fee for exceeding credit limits is up 138%

• Credit card companies earned $90.1 billion in interest last year. They earned $55.2 billion in fees

• According to one Mastercard vice president a person with a "taste for credit who's willing to make minimum monthly payments—forever" is a "preferred customer". Or shouldn't that be "sucker"?

• 1/3rd of Americans claim they pay off their credit card bills in full every month. Inside the credit card industry, these customers are known as "30-day wonders" or "deadbeats"

Dave Gilson September/October 2007 Issue © 2007 The Foundation for National Progress