Last Updated: January 18, 2022
The average credit card interest rate has nearly reached an all-time high at 17.13%, Fox Business reports.
At the beginning of the year, the credit card interest rate was 15.91%, while in the Q2 of 2021, it was estimated at 16.3%. Suddenly, in Q3, the interest rate jumped to 17.13%. As the COVID-19 pandemic is slowly coming to an end, people are starting to feel the consequences, including the financial crisis. Inflation, which is another reason behind the sudden increase in interest rates, is knocking on the door and is likely to affect everyone, everywhere.
What Does This Mean for Users?
The surprisingly rapid rise of credit card rates could put those who struggle to make consistent monthly payments in a disastrous situation. They may not have enough finances to cover the new interest rate on their credit cards. With the drastic increase in rates, people may end up spending thousands of dollars just to pay off their credits.
There are several ways that can help in paying off credit card debt, starting with credit card consolidation loans. Besides consolidation loans, taking a personal loan could be another way to consider. This type of loan is probably the easiest, and most commonly used, way to consolidate your high-interest credit debt as it usually offers lower interest rates.
A balance transfer between credit cards is also very helpful for consolidating your credit debt. Finding a credit card with little to no interest rate, in this case, is the key. This way, you simply transfer the credit debt to another credit card, paying lower interest in the process.