Gephardt Busts Inflation: Credit card predictions for 2024 and what they mean for your wallet
Jan 17, 2024, 12:21 AM | Updated: Mar 5, 2024, 4:10 pm
SALT LAKE CITY — When it comes to your credit cards, some things have changed while some other things could probably change.
KSL Consumer Investigator Matt Gephardt pulled out the crystal ball to try and predict with expert help, what it all means for your family’s finances as 2024 moves forward.
Prediction number one: Credit card late fees will decrease this year.
The Consumer Financial Protection Bureau wants to dramatically reduce what banks can charge you if you make a late payment on a credit card. Their proposed rule hasn’t been made official yet, but LendingTree’s chief credit analyst, Matt Schulz, believes it will.
“That rule is likely to be finalized early in 2024,” Schulz said. “So, that’s a really good thing.”
Federal regulators finalized a rule on March 5 to cap most credit card late fees at $8 as part of a broader push by the Biden administration to eliminate junk fees.
The Consumer Financial Protection Bureau estimates the new regulation, first proposed in February 2023, will save families more than $10 billion a year by cutting fees from an average of $32.
Prediction number two: More people will pay their credit card bills late in 2024.
Though inflation is cooling, it is still higher than the 2-or-so-percent where the Federal Reserve Bank would like to see it. That means the rising cost of everything from groceries to health care costs is outpacing people’s annual salary bumps.
“So, I do think that it really is incumbent upon people to do what they can to pay those debts down,” Schulz said.
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And prediction number three is a happy one: Credit card interest rates are probably going down this year.
The Federal Reserve has already cut interest rates and probably will cut them even further, which means credit cards – competing for your business – will begin to roll back their high APRs. But an important note, Schulz said, don’t expect your credit card company to drop your rate automatically. You’re likely going to need to prod them.
“You’re probably not going to get that help if you don’t call and ask for it,” he said.
More welcome news for folks with credit card debt: prodding tends to work.
According to a LendingTree survey from last year, three out of every four people who asked for a lower interest rate on their credit card got one. Not only that, the average reduction was about six percentage points and that can be significant.
