Fewer than half willing to cut back in each category.
NEW YORK – Households with credit card debt are outspending debt-free households in seven of nine discretionary spending categories, according to a new CreditCards.com report.
Here are the average annual expenses for each household*:
|
Category |
Debtors |
Non-Debtors |
|
Car Loan/Lease |
$5,096 |
$5,262 |
|
Leisure Travel |
$2,211 |
$3,188 |
|
Dining/Takeout |
$2,186 |
$2,023 |
|
Clothing, Shoes and Accessories |
$1,892 |
$1,515 |
|
Cell Phone Services/Upgrades |
$1,629 |
$1,326 |
|
Out-of-Home Entertainment |
$1,538 |
$1,232 |
|
Fitness |
$1,385 |
$1,317 |
|
Subscription Services |
$1,198 |
$1,083 |
|
Personal Care/Beauty |
$1,146 |
$945 |
In all nine categories, a minority of respondents would be willing to cut their spending by 50% in order to save money. Debtors are only slightly more likely to cut back than non-debtors:
|
Category |
Debtors |
Non-Debtors |
|
Car Loan/Lease |
26% |
22% |
|
Leisure Travel |
30% |
26% |
|
Dining/Takeout |
48% |
44% |
|
Clothing, Shoes and Accessories |
35% |
31% |
|
Cell Phone Services/Upgrades |
25% |
19% |
|
Out-of-Home Entertainment |
36% |
33% |
|
Fitness |
28% |
18% |
|
Subscription Services |
39% |
32% |
|
Personal Care/Beauty |
23% |
20% |
Nearly 1 in 5 (18%) Americans with credit card debt are unwilling to cut back in any of these discretionary spending categories.
“The average U.S. household spends thousands of dollars a year on non-essentials. If you’re charging these luxuries and carrying a balance, you’re spending an average of about 18% more for the privilege,” said Ted Rossman, industry analyst at CreditCards.com. “Would you have chosen the same car, plane ticket or restaurant if the price were 18% higher?”
According to the American Bankers Association, about 60% of credit cardholders carry balances from month to month. The Federal Reserve says the average household with credit card debt owes $5,700.
“For those in debt, I recommend balance transfer credit cards and looking for ways to boost your income and cut your expenses,” Rossman adds. “It’s not necessarily about going without – it’s about being an educated consumer and spending less on things you’ll still enjoy. Cutting a monthly expense is especially valuable because it comes up again and again.”
* Each category includes all households that spend in that area at least once a month (at least once a year for leisure travel)
Tatiana is the news coordinator for TravelDailyNews Media Network (traveldailynews.gr, traveldailynews.com and traveldailynews.asia). Her role includes monitoring the hundreds of news sources of TravelDailyNews Media Network and skimming the most important according to our strategy.
She holds a Bachelor's degree in Communication & Mass Media from Panteion University of Political & Social Studies of Athens and she has been editor and editor-in-chief in various economic magazines and newspapers.
