(The Center Square) – Illinois credit cardholders are piling up more debt than other Midwestern states.
According to a study by MoneyGeek, the average credit card debt for Illinois cardholders in the 2nd quarter of this year was $5,365. That is slightly lower than the national average, but higher than in neighboring states. Iowa had the lowest average credit card debt balance at $4,289 with Wisconsin and Indiana close behind.
Credit card balances totaled $787 billion in Q2 2021, down from $893 billion in Q1 2020, the last quarter before the COVID-19 pandemic.
Researcher Doug Milnes said it is not surprising because many cardholders are not comfortable carrying a sizable credit card balance.
“In our recent survey of managing credit card debt was the second most frequently most cited reason for stress-related finances,” Milnes said. “Over 80% of our survey respondents indicated they were experiencing stress over some aspect of their finances.”
According to Creditcards.com, if a person makes only the minimum payments while carrying an average credit card balance of $6,300, with around a 17% interest rate, it will take them nearly 18 years to get out of the debt. By then, they would have paid more than $7,600 in interest.
Data showed that people 35 or younger have the lowest average credit card debt at $3,700. Around 48% of individuals in this age group carry debt. Adults 75 or older have the highest average credit card debt at $8,100, but just 28% of people in this age group have debt.
The study showed households with higher incomes tend to carry higher credit card debts. For example, households in the highest income percentile, 90th to 100th, have an average of $12,600 of credit card debt. That is more than three times more than the income bracket with the lowest average debt.