With so many Americans scraping by, we’re looking at the debt traps and who’s most vulnerable.
Comforting headlines last year about how Americans were paying down household debt. Repairing their balance sheets. Maybe getting ready to rock. To bounce back. We sure hope so.
But look again at those numbers and there’s another story there, too. A lot of that “pay-down” in debt has actually been write off. People walking away from old mortgages, credit card debt. And adding new debt to get by.
Borrowing for the basics. It’s an easy trap when you’re up against it. And a lot of Americans know it.
This hour, On Point: tough times and America in debt.
Michelle Jones, senior vice president of counseling at the nonprofit financial counseling service CredAbility.
From Tom’s Reading List
The New York Times “The belt-tightening was the easy part. Cancel the cable. Skip the air conditioners. Ration the cellphone, unplug the wireless Internet, cook rice and beans — done, and done.”
The Washington Post “A large and growing share of American workers are tapping their retirement savings accounts for non-retirement needs, raising broad questions about the effectiveness of one of the most important savings vehicles for old age.”
Associated Press ”U.S. consumers took on more debt in November to buy cars and attend school, but stayed cautious with their credit cards. The Federal Reserve said Tuesday that consumers increased their borrowing in November by $16 billion from October to a seasonally adjusted record of $2.77 trillion.”