For so many families here in Arizona, the holidays don’t really end when the decorations come down. They end when the bills arrive.
As people head back to work, this is often the first moment consumers see what Christmas actually costs, and for a lot of households, that spending is sitting on credit cards.
After taking a closer look, ABC15's Kaley O'Kelley found the average American spent about $1,300 this holiday season on gifts, travel, and other holiday-related expenses. That's according to the National Retail Federation, and a large share of that spending ends up on credit cards.
Right now, credit card interest rates are high. Data from the Federal Reserve shows the average rate is around 20%. When balances carry over month to month, that interest can really add up.
If someone spends $1,300 on a credit card and only makes the minimum payment, that can cost hundreds of dollars more over time. Not because they spent more, but because interest keeps compounding.
Nonprofit credit counselors say the biggest issue they see after the holidays isn’t how much money was spent. The problems come when consumers wait to deal with it.
There is also something many people don’t realize is even an option.
If you’re in good financial standing, you can often call your credit card company and ask for a temporary interest rate reduction.
Counselors with Take Charge America, a nonprofit financial counseling agency, say that one step alone can save up to $500 over the course of a year, depending on your balance and current rate.
This is not debt consolidation. It doesn’t involve taking out a new loan or transferring balances. It’s simply about lowering the interest rate, temporarily, on what you already owe, so more of your payment goes toward the credit card balance instead of interest.
If making that call feels intimidating, you don’t have to do it alone.
Take Charge America does offer nonprofit credit counseling to help people understand available options and, in some cases, they work directly with creditors for those who really need help.
Take Charge America
- First Time Clients: (866) 750-9618
- Existing Clients: (866) 528-0588
- Website: takechargeamerica.org
