KSL INVESTIGATES

Gephardt: Credit Card Debt Drops As Americans Rein In Spending During Pandemic

Aug 17, 2020, 7:14 PM | Updated: 8:28 pm

SALT LAKE CITY, Utah – When the job market tanked with the rise of stay-at-home orders and COVID-19 quarantines, many analysts expected a sharp rise in credit card use as cardholders and their families would do what they could to make ends meet. Here’s some surprising statistical analysis: Credit card debt is down for most people this time around. Why? 

“The fact that (credit card debt) is down in this climate is shocking,” said Ted Rossman, industry analyst for Bankrate.com. 

The total revolving debt of Americans is down by 10%, according to numbers from the Federal Reserve, and earlier this spring, it was down as much as 40%. 

Rossman said the government stimulus helped prop up people’s personal finances. At the same time, all the uncertainty about whether it will continue has many folks tightening their belts. 

“A lot of people are really worried right now about their jobs and the state of the economy,” he explained. 

Another factor: Thanks to COVID-19 restrictions, folks have not been able to spend on things like show tickets or big expensive vacations, which had brought spending down.

While charging less is certainly good news for people who struggle with credit card debt, it’s maybe not so good news for businesses that are struggling to reopen during the pandemic.

As we have reported, charging less can have an unintended consequence: If you don’t use your credit card, you run the risk of the bank canceling the card on you — which can have a major negative impact on your credit score.

Rossman’s advice for folks not wanting to rack up more debt without drawing the ire of their credit card company: 

“I think bottom line – the best way to use a credit card is like a debit card. Use it for the rewards, use it for the better consumer protections but pay it off right away before interest accrues,” he said. 

While people are using their credit cards during this pandemic, they are using their debit cards just as much as they were before. Statistically, debit card usage is flat.

KSL 5 TV Live

KSL Investigates

This weekend's Academy Awards show has boosted demand for many of its nominated films. (KSL TV)...

Matt Gephardt and Sloan Schrage

The added cybersecurity risks of watching free streams of Oscar-nominated movies

This weekend's Academy Awards show has boosted demand for many of its nominated films. The continually increasing prices of streaming services – Apple, Amazon Prime, Disney+, Netflix and others raised their costs last October – is pushing many folks to look for ways to watch these films for free. But cybersecurity experts warn searching for free streams can get way more costly.

5 hours ago

Leah Moses...

Annie Knox

Utah lawmakers pass ‘Om’s Law,’ focused on child safety in custody decisions

Utah lawmakers gave final passage to bill requiring judges to consider evidence of domestic violence raised in child custody cases.

3 days ago

Matt Gephardt being shown the double payments that Terry Hutchings has been getting....

Matt Gephardt and Sloan Schrage, KSL TV

Get Gephardt helps homeowner being charged two bills for one security system

Billing for a previous home initially stopped when she sold it, but when she got a new security system from the same provider for her new place a year later it started billing for both.

4 days ago

fences and buildings with an inmate walking on a snowy sidewalk...

Daniella Rivera

New Prison, New Problems: Inside the effort to staff Utah’s new $1 billion prison facility

Utah's new prison cost taxpayers more than a $ 1 billion, yet a scathing audit shows the new facility has been unsafe and still isn't being used as intended. After being granted unprecedented access, the KSL Investigators go inside the new prison for a look at what's being done to fix its new problems.

5 days ago

Neilson-Berg explaining the hassles and trouble she has been going through to get into contact with...

Matt Gephardt

Get Gephardt helps Google Fiber customer get her internet fixed after customer service calls go nowhere

When a Salt Lake City woman's internet connection went down, and she couldn't get a straight answer as to when it would be back up, she decided to Get Gephardt.

5 days ago

dome and side of the Utah Capitol...

Daniella Rivera and Annie Knox, KSL TV

Truth Test: Fact-checking claims from lawmakers who voted to make their calendars secret

The KSL Investigators put lawmakers’ statements about a measure that would conceal their calendars through the KSL Truth Test.

5 days ago

Sponsored Articles

Modern chandelier hanging from a white slanted ceiling with windows in the backgruond...

Lighting Design

Light Up Your Home With These Top Lighting Trends for 2024

Check out the latest lighting design trends for 2024 and tips on how you can incorporate them into your home.

Technician woman fixing hardware of desktop computer. Close up....

PC Laptops

Tips for Hassle-Free Computer Repairs

Experiencing a glitch in your computer can be frustrating, but with these tips you can have your computer repaired without the stress.

Close up of finger on keyboard button with number 11 logo...

PC Laptops

7 Reasons Why You Should Upgrade Your Laptop to Windows 11

Explore the benefits of upgrading to Windows 11 for a smoother, more secure, and feature-packed computing experience.

Stylish room interior with beautiful Christmas tree and decorative fireplace...

Lighting Design

Create a Festive Home with Our Easy-to-Follow Holiday Prep Guide

Get ready for festive celebrations! Discover expert tips to prepare your home for the holidays, creating a warm and welcoming atmosphere for unforgettable moments.

Battery low message on mobile device screen. Internet and technology concept...

PC Laptops

9 Tips to Get More Power Out of Your Laptop Battery

Get more power out of your laptop battery and help it last longer by implementing some of these tips from our guide.

Users display warnings about the use of artificial intelligence (AI), access to malicious software ...

Les Olson

How to Stay Safe from Cybersecurity Threats

Read our tips for reading for how to respond to rising cybersecurity threats in 2023 and beyond to keep yourself and your company safe.

Gephardt: Credit Card Debt Drops As Americans Rein In Spending During Pandemic