: Americans are less confident they can make the minimum payments on their credit cards, New York Fed says

by | Oct 11, 2023 | Stock Market

More Americans think they’re in danger of falling behind on their debts. People’s expectation of missing a minimum payment on a debt — anything from credit cards, to auto loans to student loans and mortgages — increased in September to the highest level since May 2020, according to the Federal Reserve Bank of New York’s Survey of Consumer Expectations, released Tuesday. Survey respondents said there was a 12.5% chance on average that they would not be able to make the minimum required payment on a debt, up 1.4 percentage points from the previous month.

Two groups reported the biggest increases in worries about debts in September: Those who are below the age of 40 and who have some college education, and those with an annual household income below $50,000, the researchers said.  The rise in consumers’ expectation of missing minimum debt payments “was an indication that inflation and higher interest rates are catching up with people, especially people with lower incomes and lower credit scores,” said Ted Rossman, senior industry analyst at Bankrate.com.   Student loan repayment started this month after pausing for three years. Those who had “some college education” might be the most vulnerable of all, Rossman said.  “They may have taken on student debt, but they didn’t get the degree to show for it. So they may not be enjoying the higher wages and the lower unemployment rate,” Rossman added.  At the …

Article Attribution | Read More at Article Source

Share This