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Consumer credit card debt shrinks while student loans increase

Many Americans can run into problems with credit cards. Revolving debt with high-interest rates can get anyone into trouble, no matter how financially responsible they may be. Fortunately, it was recently reported that balances on credit cards in the United States have declined for the fourth consecutive month, A fact that our Tennessee readers with credit card debt may not be aware of.

The Federal Reserve reported that revolving credit or credit card debt fell by $2.06 billion in September. This is a 2.91 percent drop in debt. In fact, revolving debt has dropped every month for the last four months, according to the Federal Reserve. The Reserve reported that the total decrease in consumer credit card debt over the last four months was $8.48 billion.

While the decrease in consumer revolving debt is certainly a positive sign, non-revolving debt, such as car loans and education loans, actually increased by nearly $16 billion. According to experts, non-revolving debt has been growing since 2010, reflecting an increase in both government-backed student loans as well as the purchase of new automobiles. According to economists, total consumer credit, not including home loans, is up by nearly $14 billion.

With Americans taking on so much debt it is clear that debt relief continues to be a major issue. For most consumers, however, there is an answer. No one has to struggle with financial challenges alone. When a Tennessee resident is dealing with credit card bills, medical expenses or a mortgage that is underwater, it is possible to get a fresh financial start, and bankruptcy may be an option

Source: Wall Street Journal, "Credit-Card Debt Declines for Fourth Straight Month," Jeffrey Sparshott, Nov. 7, 2013

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