Many Americans’ credit-card debt now towers over their savings. Here’s how to build an emergency fund while paying off debt.

Tim Whistler’s credit-card debt gradually grew to about $8,000. The cost of everyday products rose, his monthly rent jumped from $1,000 to $1,400 over four years, and then last year, his son was born, adding entirely new categories of expenses. Like a growing number of Americans, his credit-card debt now exceeds what he has in savings.  “Emotionally, my stress level from seeing my credit score go down, my bills go up, and a mountain of debt has certainly affected me,” said Whistler, 41. 

He’s far from alone: More than one-third of U.S. households (36%) say they are carrying more credit-card debt month to month than they have in emergency savings funds, according to a new survey by Bankrate. That’s the highest percentage since polling began in 2011.  That was more likely to be the case for Gen X and millennial consumers, the survey found. Meanwhile, baby boomers were more likely to say their emergency savings exceeds their credit-card debt. “The 60% of U.S. households living paycheck to paycheck are really feeling it, and necessities rather than discretionary items are increasingly being put on credit cards,” Greg McBride, chief financial analyst at Bankrate, told MarketWatch. Because credit-card interest rates have climbed to 20% or higher, the fact …

Article Attribution | Read More at Article Source